Summary of Key Points
Aodong New Energy is a battery swapping company founded by Cai Dongqing, the creator of "Pleasant Goat," with a valuation that once reached 11.9 billion yuan, aiming to become the first stock in the Hong Kong market focused on battery swapping technology. The company adopts an open third-party approach for battery swapping, but its financial situation is concerning: its own battery swapping stations have been continuously losing money (costing 121 yuan for every 100 yuan earned), and its profit-making equipment sales business has declined, resulting in a cumulative loss of 1.47 billion yuan over three and a half years. Additionally, Aodong faces competition from both NIO (a car manufacturer that builds its own battery swapping infrastructure) and CATL (a leading battery technology company). It also has to contend with the challenge of faster charging technologies and is now seeking a breakthrough through an IPO.
I. Behind the Cross-Business Venture: Why Did the Creator of "Pleasant Goat" Enter Battery Swapping? Why Did NIO Capital Invest in a Competitor?
Cai Dongqing's transition from creating animated toys for "Pleasant Goat" to developing battery swapping technology is quite surprising. There is actually a connection between his previous business and his new venture: as a child, he enjoyed building four-wheel drive cars and replacing the batteries with Type 5 batteries, which involves similar steps of removing and installing components. His partner, Zhang Jianping, who has been in the battery swapping industry since 2000, provided the technical expertise, while Cai Dongqing provided the financial support.
What's more intriguing is NIO Capital's investment in Aodong. Despite NIO being a strong supporter of battery swapping and having its own infrastructure, why would it invest in a company that could potentially compete with it? The reason is simple: there are two main approaches to battery swapping—car manufacturers building their own systems (as NIO does) or using third-party public services (as Aodong does). In 2018, when the battery swapping model was still unproven, NIO Capital's investment in Aodong was like having a backup plan, betting on both approaches to diversify risks.
II. Comparison of Battery Swapping Models: Aodong and NIO Are Not Competitors
Although Aodong and NIO both swap entire batteries from under the car, their systems are different: the battery sizes, locking mechanisms, and communication protocols vary, making it impossible for NIO cars to use Aodong's stations and vice versa.
- NIO Model: NIO manufactures its own cars and builds its own battery swapping stations. This approach ensures a consistent user experience (e.g., stable charging speeds), but it is costly (each station costs millions of yuan) and can only serve NIO's customers.
- Aodong Model: Aodong focuses on providing open third-party services, aiming to make its stations compatible with cars from different manufacturers. In theory, more stations mean higher profits, but car companies may prefer to use their own standards, as they want control over the battery swapping process.
III. Financial Challenges: Declining Profitable Business, Growing Losses
Aodong's business is divided into two parts:
1. Equipment Sales and Service Operations: This segment is profitable, with gross margins as high as 62%. However, revenue from this area has dropped significantly, from 627 million yuan in 2023 to 242 million yuan in 2025, a decrease of 60%, indicating fewer customers purchasing equipment.
2. Self-Operated Battery Swapping Stations: This segment is unprofitable, with a gross margin of -21.4% in 2025. For every 100 yuan earned from charging services, Aodong incurs 121 yuan in costs (electricity, labor, and equipment depreciation). The proportion of revenue from this segment has increased from 45.8% to 64.3%, turning it into the main source of losses and contributing to a 40% decline in total revenue over three years, resulting in a cumulative loss of 1.47 billion yuan.
To address these issues, Aodong had to reduce its number of self-operated stations and rely more on partnerships, focusing solely on equipment sales and services. It finally achieved a positive gross margin for the first time in the first four months of 2026, but its financial situation remains challenging.
IV. Pressure from Giants: NIO and CATL Compete Directly, and Faster Charging Technologies Threaten Business
Aodong is caught between two powerful competitors:
- NIO and CATL: NIO is a leader in battery swapping, with annual revenue six times that of Aodong in 2025, and the two companies have announced plans to standardize battery swapping technology. It would be difficult for Aodong to establish its own standards.
- Faster Charging Technologies: While battery swapping offers faster charging, newer technologies like比亚迪's 5-minute 400-kilometer charge and CATL's 3 minutes and 44 seconds charge are becoming increasingly popular. Private car owners can easily charge their cars while having a coffee, reducing the need to use battery swapping stations.
Aodong is forced to target other markets with high demand for battery swapping, such as taxis, ride-hailing services, and heavy trucks. However, these sectors are also targeted by giants like CATL and NIO. Aodong lacks its own battery production and car manufacturing capabilities and relies on technology and partnerships. With limited funding (no new investments in four years), an IPO has become its last hope for survival.
Conclusion
Aodong's story is one of entrepreneurial courage, but the reality is harsh. The company faces not only financial losses but also significant competitive pressures from market leaders and emerging technologies. Whether it can survive through an IPO depends on whether investors see the potential of third-party battery swapping services. After all, the future of battery swapping may already be in the hands of NIO and CATL.