Summary of Key Points
Both Avita and Seres are core partners in Huawei's smart car ecosystem, but due to the different cooperation models they have chosen (Avita's HI/HI PLUS model retains brand autonomy, while Seres' Smart Selection model relinquishes product definition and channel control), there are significant differences in their financial performance, sales volumes, and capitalization: Seres achieved revenue of 165 billion yuan and a profit of 5.9 billion yuan in 2025, and has already completed its A+H stock listing; Avita, on the other hand, lost 11.2 billion yuan over three years and still faces uncertainty regarding its second attempt to list on the Hong Kong Stock Exchange. Essentially, the degree of control relinquished to Huawei in the cooperation model determines the allocation of resources and profitability.
I. Cooperation Models: "Making Our Own Decisions" vs. "Huawei Helping to Manage" – The Root of the Differences
There are three types of collaborations between Huawei and car companies: selling components, the HI model (where the car company takes the lead), and the Smart Selection model (where Huawei is more deeply involved). Avita chose the HI model, while Seres opted for the Smart Selection model, which marks the beginning of their divergence:
- Avita's HI Model: Huawei provides only intelligent driving and cockpit technology; Avita determines the products, builds the brand, and establishes its own channels. With the upgrade to HI PLUS, Huawei becomes more involved in marketing, but the brand remains under Avita's control. The downside is that Avita must fund the establishment of its own channels (it had 313 dealerships in 2025, all funded by itself), and it cannot utilize Huawei's retail network.
- Seres' Smart Selection Model: Huawei manages almost every aspect – from product design (such as the configuration of the Askar M9) to technology development and sales (through Huawei stores). When consumers buy an Askar, their first thought is "this is a Huawei car," with Seres mainly responsible for production. The advantage is accessing Huawei's extensive network of thousands of stores, leading to rapid sales growth; the downside is having to pay a high technology fee to Huawei (22.3 billion yuan in 2025, which is 3.7 times its profit).
In simple terms, Avita is an "independent brand using Huawei's technology," while Seres is more of a "Huawei-led contract manufacturer and partner."
II. Finance and Sales: One Makes a Profit, While the Other Loses – Scale and Price Are Key Factors
A comparison of the two groups' data highlights these differences:
- Revenue and Profit: Seres had revenue of 165 billion yuan in 2025 (6.4 times that of Avita's 25.6 billion yuan), with a net profit of 5.9 billion yuan; Avita lost 11.2 billion yuan over three years and is still expected to lose 3.4 billion yuan in 2025.
- Sales Volumes: Seres sold 470,000 units (with Askar accounting for 420,000), while Avita sold 120,000 units.
- Unit Prices: The average price of Seres' Askar is 390,000 yuan (e.g., the M9 costs 500,000 yuan), whereas Avita's prices have dropped from 270,000 yuan in 2023 to 200,000 yuan in 2025.
Why such a difference?
- Seres relies on Huawei's channels to sell high-end cars, achieving a gross margin of 28.8% (leading in the industry); Avita, with higher costs due to self-built channels, has a gross margin of only 9.4%, which does not even cover its sales and administrative expenses.
- Seres has increased its scale, reducing costs (e.g., through cheaper parts procurement), entering a positive cycle of "selling more → making more → reinvesting"; Avita has not yet reached the break-even point (typically requiring 200,000–300,000 units).
III. Capitalization: Seres Has Successfully Listed, While Avita Is Still Struggling
Seres completed its Hong Kong stock listing in November 2025, raising 14 billion Hong Kong dollars with 133 times more subscriptions than expected, attracting investment from the capital market. It now has 87.2 billion yuan in cash and has reduced its debt-to-asset ratio, allowing it to expand production and invest in research and development.
Avita submitted its application to the Hong Kong Stock Exchange for the first time in November 2025, but it expired six months later and resubmitted it in June 2026. It faces three major challenges:
1. Continuous Losses: It has lost 11.2 billion yuan over three years and is expected to lose again in 2026.
2. Fluctuating Sales: Sales in the first five months of 2026 were lower than the same period last year.
3. Integration Uncertainty: Integration with Changan's Deep Blue brand could reduce costs by 20–30%, but the specifics are unclear, and whether this will affect brand independence is uncertain.
The capital market is becoming more cautious about loss-making car companies. For Avita to succeed in its listing and raise funds, it must show investors that there is potential for profitability.
IV. Profit Distribution: Does Huawei Get the Biggest Share, While Car Companies Get a Small Portion? The Model Is Changing
Huawei's profit comes from technology, especially high-margin technologies. For example, its subsidiary Yiwang (responsible for car-related technology) had a gross margin of 55% in 2024, higher than any car company.
- Seres paid Yiwang 22.3 billion yuan in 2025, accounting for 13.5% of its revenue, which is 3.7 times its net profit – essentially, most of the profits went to Huawei as technology fees.
- Avita also holds a 10% stake in Yiwang (for 11.5 billion yuan), but with lower procurement volumes and fewer related transactions, it only received 180 million yuan in revenue from Yiwang, which is negligible compared to its losses of 3.4 billion yuan.
However, the model is changing: Seres has acquired the Askar trademark, and Huawei is reducing direct control; both Avita and Seres are now shareholders in Yiwang, potentially sharing its profits in the future. However, Yiwang's profit base still relies on selling technology to car companies, so it remains uncertain whether car companies can obtain cheaper technology.
V. Future Prospects: Can Avita Break Through? Will Seres Hit a Bottleneck?
- Avita's Challenges: Can it become profitable after listing? This depends on reducing costs through integration with Deep Blue (e.g., sharing production lines and parts) and whether the HI PLUS model can be successful (without being just a contract manufacturer). If prices continue to drop, gross margins may further decrease; if not, sales volumes will struggle.
- Seres' Challenges: Huawei is beginning to distribute its technology more broadly (e.g., the Hujing brand uses the same technology for 200,000–250,000 yuan, half the price of Askar), which could affect Askar's premium image. Seres' net profit only increased by 0.18% in 2025, and non-recurring items decreased by 7.8%, indicating that its growth is slowing. It needs to find new sources of revenue (e.g., overseas markets).
In summary, in Huawei's cooperation model, relinquishing control for resources can lead to quick profits but may result in the loss of independence for car companies; retaining control allows for brand development but comes with higher costs and risks. Avita's second attempt at listing is a test of whether car companies can maintain their brands while also achieving profitability within Huawei's ecosystem. This is not only a concern for Avita but also for all other companies that wish to collaborate with Huawei without becoming mere contract manufacturers.
(The entire analysis is presented in plain language to make the core differences between the two companies understandable to a general audience.)