Summary of Key Points
In order to fill the product gap in the 100,000 to 150,000 yuan "golden price range" for new energy vehicles, FAW Group has separated the Yuyi new energy series, which was previously part of the Besturn brand, into a standalone brand. The group hopes to overcome the systemic flaws from the Besturn era (such as slow decision-making, strategic indecision, and a damaged brand image) through market-oriented operations, technological upgrades, and channel reforms, thereby breaking through in the highly competitive new energy market and advancing its own new energy transformation. This represents a bold self-reform effort by FAW to address its weaknesses in the new energy sector.
I. The 100,000 to 150,000 Yuan Price Range: The Crucial New Energy Market FAW Has Long Been Absent From
This price segment is where the majority of Chinese consumers purchase cars. In 2025, 7.87 million vehicles were sold in this range, accounting for 33% of the total annual sales (almost one out of every three vehicles). New energy vehicles accounted for 37% of this segment, but while sales of other car types declined by 24% year-on-year in the first quarter of this year, new energy vehicle sales increased by 6.1%, making it a stronghold for essential consumer needs.
However, FAW has had a weak presence in this market. Why? The Besturn brand, which was responsible for this price range, failed to meet expectations: it lacked market influence, its new energy strategy was inconsistent, and its products were unsold, causing FAW to miss out on this critical market segment and lagging far behind competitors like Changan and Dongfeng in its transformation.
II. Besturn's Dilemmas: From a "Substitute for Mazda" to a "Low-Price Bubble"
Besturn's decline was gradual:
1. Dependent on Others, Lacking Own Technology: During the gasoline vehicle era, Besturn became successful by imitating Mazda (selling 185,600 units in 2014). However, when Mazda faced difficulties, FAW-Mazda's partnership collapsed, leaving Besturn without a technological backbone. As a result, its sales declined year after year, and it relied on car-sharing services to maintain its presence.
2. Strategic Indecision and Waste of Resources: When transitioning to new energy, Besturn experimented with both pure electric and hybrid models but gave up easily when faced with challenges. This led to the waste of research and development funds, manufacturing costs, and channel investments. The brand's logo was changed several times, making it difficult for consumers to recognize.
3. Low-Price Tactics: In 2024, Besturn launched the Besturn Xiaoma at a price of less than 30,000 yuan (even less than 10,000 yuan after subsidies). Although sales reached a record high of 200,000 units, each unit resulted in a loss, firmly establishing the brand as a "cheap" option. When subsidies were reduced, sales plummeted, and the bubble burst.
4. Systemic Issues: As a state-owned enterprise, FAW's decision-making process was slow, and with frequent changes in leadership, there was no consistent focus on building core technologies or product development capabilities. In contrast, competitors like Changan and Dongfeng have independent new energy brands (such as Deep Blue and Lantu) that operate more flexibly and can share technology.
III. The Separation of Yuyi: FAW's Bold Self-Reform
The creation of the Yuyi brand aims to break away from past shortcomings:
1. Market-Oriented Operations: As an independent brand, Yuyi avoids the slow approval processes typical of state-owned enterprises, allowing for faster decision-making. Performance evaluations focus on research and development outcomes and long-term customer value, rather than short-term sales targets.
2. Technological Upgrades: Yuyi uses FAW's own "Yueying" pure electric platform for forward-looking R&D, featuring 800V high-speed charging and over-the-air (OTA) updates. It also collaborates with industry leaders like CATL and Huawei to improve battery performance and intelligent infotainment systems.
3. Channel Transformation: Yuyi sells its products through direct stores in first- and second-tier cities, choosing exclusive dealers to shed the "low-end" label. It also has its own brand app for targeted customer management.
4. Aggressive Product Planning: In addition to the initial Yuyi 08 model, plans include an A-class SUV (Yuyi 06) and a B+ class flagship (Yuyi 09), covering all types of new energy vehicles in the 100,000 to 150,000 yuan range.
IV. Yuyi's Opportunities and Challenges: Can It Break Through the Fierce Competition?
Opportunities:
- State-Owned Enterprise Reputation: FAW's credibility and quality attract certain consumers.
- Fresh Brand Image: By shedding the Besturn's low-end image, Yuyi targets younger and family-oriented customers with more practical product features (e.g., in terms of hardware components).
Challenges:
- Brand Awareness: Brands like比亚迪 Song and Deep Blue S05 sell over 10,000 units per month, so establishing Yuyi's identity and value will take time.
- Fierce Competition: Joint-venture brands (such as Toyota and Nissan) are also competing in this price range, so Yuyi needs to offer unique selling points.
- Time and Patience: FAW cannot rely on immediate sales growth; it must be prepared for initial losses and focus on building customer loyalty over the long term.
V. The Key to FAW's Transformation: The Success of Yuyi
For FAW, Yuyi is not an optional brand but a necessary step to address its weaknesses. Only by establishing a solid foothold in the 100,000 to 150,000 yuan segment and combining efforts with its high-end brand Hongqi (Tiangong series) to share technology and resources can FAW's new energy transformation be successful. Otherwise, it will continue to fall behind competitors in the new energy market.
In summary, the launch of Yuyi represents a radical shift for FAW. While there are many past issues that need to be addressed, its success depends on its ability to adopt market-oriented approaches and deliver reliable, affordable products. After all, the market values functional and cost-effective vehicles, not just the status of a state-owned enterprise.