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1、2023 ANNUAL REPORTOfficial websiteWeChat official accountContents2Corporate Information4Chairmans Statement6Summary of Operations7Company Profile and Business Overview24Management Discussion and Analysis27Report of the Board of Directors49Report of the Board of Supervisors51Corporate Governance Repo
2、rt67Directors,Supervisors and Senior Management78Environmental,Social and Governance Report132Independent Auditors Report138Consolidated Balance Sheet140Consolidated Statement of Comprehensive Income142Consolidated Statement of Changes in Equity144Consolidated Statement of Cash Flows145Notes to the
3、Consolidated Financial Statements221DefinitionsBAIC Motor Corporation Limited ANNUAL REPORT 20232Section I Corporate Information LEGAL NAME OF THE COMPANYBAIC Motor Corporation Limited ENGLISH NAME OF THE COMPANYBAIC Motor Corporation Limited1 REGISTERED OFFICEA5-061,Unit 101,5/F,Building No.1,Court
4、yard No.99,Shuanghe Street,Shunyi District,Beijing 101300,China HEADQUARTERSNo.99 Shuanghe Street,Shunyi District,Beijing 101300,China PRINCIPAL PLACE OF BUSINESS IN HONG KONG31/F,Tower Two,Times Square,1 Matheson Street,Causeway Bay,Hong Kong AUTHORIZED REPRESENTATIVESMr.Song Wei5/F,No.99 Shuanghe
5、Street,Shunyi District,Beijing,ChinaMr.Wang Jianhui5/F,No.99 Shuanghe Street,Shunyi District,Beijing,China1 For identification purpose only COMPANY SECRETARYMr.Wang Jianhui5/F,No.99 Shuanghe Street,Shunyi District,Beijing,China HONG KONG LEGAL ADVISORLinklaters11th Floor,Alexandra House,18 Chater Ro
6、ad,Hong Kong CHINA LEGAL ADVISORJunHe LLP20/F,China Resources Building,8 Jianguomenbei Avenue,Dongcheng District,Beijing,China AUDITORS(EXTERNAL AUDIT FIRM)PricewaterhouseCoopersCertified Public Accountants and Registered PIE Auditor22/F,Princes Building,Central,Hong KongPricewaterhouseCoopers Zhong
7、 Tian LLP(Special General Partnership)11/F,PricewaterhouseCoopers Center,202 Hubin Road,Shanghai,ChinaANNUAL REPORT 2023 BAIC Motor Corporation Limited 3Section I Corporate Information PRINCIPAL BANKSBank of Beijing,Jinyun BranchBlock A,Jinyun Building,A43 Xizhimen North Street,Haidian District,Beij
8、ing,ChinaChina CITIC Bank,Olympic Village Branch1/F,Tower D,Tian Chuang Shi Yuan Building,No.309 Huizhong Beili,Chaoyang District,Beijing,China H SHARE REGISTRARComputershare Hong Kong Investor Services LimitedShops 1712-1716,17/F,Hopewell Center,183 Queens Road East,Wanchai,Hong Kong H SHARE STOCK
9、CODE1958 INVESTOR ENQUIRIESInvestor hotline:(86)10 5676 1958;(852)3188 8333Website:E-mail:BAIC Motor Corporation Limited ANNUAL REPORT 20234Section II Chairmans StatementDEAR SHAREHOLDERS,On behalf of the Board of Directors(the“Board”),I am delighted to present the 2023 annual report of BAIC Motor C
10、orporation Limited(the“Company”,together with its subsidiaries,the“Group”or“we”).In 2023,Chinas overall economy rebounded and improved,with domestic high-quality development steadily progressing.The annual gross domestic product(“GDP”)exceeded RMB126 trillion,marking a 5.2%increase2.This growth rate
11、 positioned China among the top-ranked economies in the world.The overall automobile market in China has been recovering with positive sign.In 2023,the market recorded an automobile production and sales volume of over 30 million units for the first time,maintaining its position as the worlds largest
12、 market for 15 consecutive years.The new energy vehicle(“NEV”)market continued to undergo rapid development driven by innovation.According to the data of China Association of Automobile Manufacturers(“CAAM”),in 2023,Chinas automobile sales amounted to 30.094 million units,representing a year-on-year
13、 increase of 12%,of which sales of passenger vehicles amounted to 26.063 million units,representing a year-on-year increase of 10.6%,sales of NEVs amounted to 9.495 million units,representing a year-on-year increase of 37.9%,and exports of passenger vehicles amounted to 4.140 million units,represent
14、ing a year-on-year increase of 63.7%.Embarking on the new year,we strive to make breakthroughs.In 2023,the Group continued to consolidate its development base by adhering to the operational philosophy of Survival,Reform,and Development.We optimized the product structure of each brand,promoted produc
15、t renewal,and wholeheartedly embraced the core mission of Sales Increase.Additionally,we improved operational efficiency through lean operations in accordance with market conditions.The Group remained committed to promoting the synergistic development of the entire value chain and achieving core bus
16、iness objectives.During the Reporting Period,sales of vehicles amounted to 1.042 million units,a year-on-year increase of 7.3%.The Group recorded the consolidated revenue of RMB197.95 billion and the net profit of RMB13.63 billion for the year.197.95BillionRMBIn 2023,the Group recorded the consolida
17、ted revenue of RMB197.95 billion and the net profit of RMB13.63 billion for the yearChen WeiChairman1.042Million UnitsIn 2023,Beijing Brand,Beijing Benz,Beijing Hyundai and Fujian Benz sold a total of 1.042 million units of vehicles2 It is published by the National Bureau of StatisticsANNUAL REPORT
18、2023 BAIC Motor Corporation Limited 5Section II Chairmans Statement2024 is a critical year for China to implement the 14th Five-Year Plan.Adhering to the general principle of pursuing economic progress while maintaining stability,China aims to achieve stability through progress and establish new pra
19、ctices by phasing out outdated ones.China will strengthen counter-cyclical and cross-cyclical adjustments of macroeconomic policies,so as to consolidate and enhance the uptrend of the economy.In 2024,with the implementation of macroeconomic controls and favorable policies,Chinas automotive market is
20、 expected to maintain a stable and improving trend.As intelligent and electric transformations progress,NEVs gain more market share and rapid growth in exports sustains,the automobile market could hopefully reach new highs.A critical year comes with a crucial mission.In the upcoming year,the Group a
21、dheres to the philosophies of high-quality and sustainable development.We will focus on stabilizing our development foundation and adhering to the business objectives of Survival,Reform,and Development.Our primary focus will be on increasing sales volume and scale,promoting the renewal of flagship m
22、odels and implementing a“fuel+electric”and hybrid product strategy.We aim to expand sales in both domestic and international markets based on stable production and enhanced profit.By accelerating breakthroughs in international markets and boosting research and development investments,we strive to st
23、rengthen and advance our Comprehensive New Energy Transformation product line and continuously enhance overall market competitiveness.These efforts are aimed at fully achieving our business objectives in 2024 and creating a new era of competitive growth.Lastly,I would like to express my gratitude to
24、 all our staff and partners for their hard work,and to our Shareholders for their long-lasting support.Chen WeiChairmanMarch 22,2024In 2023,the Group adhered to Comprehensive New Energy Transformation and significantly expanded its presence in the new energy sector.We accelerated the progress of pla
25、tform projects and actively converted product dynamism,aiming to seize the market opportunities in the new energy market.The Group achieved sales of 102,000 NEVs for the year,a year-on-year increase of 46.6%,with a growth rate exceeding the industry average level.Furthermore,the Group increased its
26、equity interest in BAIC BluePark New Energy Technology Co.,Ltd.(“BAIC BluePark”),accelerating its strategic presence in the realm of new energy.With focus on domestic and international dual strategic markets,we vigorously expanded our business overseas,making a significant progress in the internatio
27、nal market.The Group achieved 59,000 vehicle exports,representing a year-on-year growth of over 200%,a growth rate that significantly exceeds the industry standard and has become a stable growth point for the Group.We were dedicated to product refinement,system upgrades,and continuous promotion of p
28、roduct matrix innovation,resulting in the launch of more than 10 new models under the Groups brands.Furthermore,the Group strategically entered the crossover off-road market as a new business venture,allowing it to participate in the entire value chain of off-road vehicles.These initiatives have fos
29、tered a new synergistic development among various brands.With continuous support from the independent business,we optimized the product creation system,upgraded the marketing platform,and implemented other significant reforms.The perfect conclusion of the brand reshaping trilogy resulted in a new co
30、rporate image and structure,enabling us to challenge the market.This effort led to annual sales of over 160,000 units and positioned us for competitive growth.Adhering to the innovation-driven approach,we invested more in the research and development,to pursue the control of core technologies and le
31、ad the development of the Company.The Company has further conducted extensive strategic cooperations with Mercedes-Benz Group AG(“Mercedes-Benz Group”)and Hyundai Motor Company(“Hyundai Motor”)in the realm of electric vehicles for future development.In addition,we have always practiced green develop
32、ment and responded to the national“Dual-Carbon”guideline by building green factories,implementing energy saving and emission reduction,and continuing to explore the path of high-quality and sustainable development.Based on 2023 results of operations,the Board of Directors recommended the payment of
33、a final dividend of RMB0.13 per share(tax inclusive)to Shareholders,so as to practically provide a return to Shareholders.BAIC Motor Corporation Limited ANNUAL REPORT 20236Section III Summary of Operations(Unit:RMB million)For the year ended December 31,Item20232022202120202019 Sales volume(units)1,
34、042,005947,0611,031,2031,168,6101,425,070Revenue197,949190,463175,916176,973175,410Cost of sales157,879(148,128)(138,273)(134,833)(137,776)Gross profit40,07042,33437,64342,14037,634Selling and distribution expenses(11,840)(11,177)(10,312)(11,309)(10,414)General and administrative expenses(5,113)(5,3
35、38)(5,799)(7,984)(7,195)Net impairment losses on financial assets(565)(475)(87)(401)(256)Other gains/(losses),net176642,515(101)2,862Finance gains/(costs),net31161100(162)Share of loss of investments accounted for using equity method(1,600)(1,281)(1,101)(2,015)(314)Profit before income tax21,00024,7
36、2922,92020,43022,155Income tax expense(7,374)(8,394)(7,769)(7,475)(6,998)Profit for the year13,62616,33515,15112,95515,157 Attributable toEquity holders of the Company3,0304,1973,8582,0294,996Non-controlling interests10,59612,13811,29310,92610,161 As at December 31,Total assets,total liabilities and
37、 interests attributable to equity holders of the Company20232022202120202019 Total assets168,723173,375180,844193,703196,393 Total liabilities89,34094,438105,957120,109124,018 Interests attributable to equity holders of the Company57,00954,49752,58351,08850,007 Note:Information on sales volume inclu
38、des total wholesale sales of Beijing Brand,Beijing Benz,Beijing Hyundai and Fujian Benz.Information for 2019 to 2022 is extracted from the Companys 2022 annual report.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 7Section IV Company Profile and Business OverviewI.OVERVIEWWe are a leading passeng
39、er vehicle enterprise in China,and are one of the passenger vehicle manufacturers with the relatively optimized brand layout and business system in the industry.Our brands cover joint venture premium passenger vehicles,joint venture premium multi-purpose passenger vehicles,joint venture mid-to-high-
40、end passenger vehicles and proprietary brand passenger vehicles,among others,which can maximally satisfy various consumers demands.The Company completed its H shares initial public offering and was listed on the Main Board of The Stock Exchange of Hong Kong Limited(the“Stock Exchange”)on December 19
41、,2014(H shares stock abbreviation:BAIC Motor;H shares stock code:1958).II.MAJOR BUSINESS OPERATIONSThe Group is principally engaged in the research and development,manufacturing,sales and after-sales services of passenger vehicles,production of core parts and components of passenger vehicles,car fin
42、ancing,international businesses and other related businesses.It keeps optimizing its industry chain and strengthening its brands.Passenger VehiclesThe Group is accelerating its transformation and upgrade towards electrification and intelligence.Its passenger vehicle product lineup covers internal co
43、mbustion engine and new energy models.The business of the Group is carried out through four business divisions,namely,Beijing Brand,Beijing Benz,Beijing Hyundai and Fujian Benz.1.Beijing BrandBeijing Brand,our proprietary brand,covers sedans,SUVs and off-road vehicles in both internal combustion eng
44、ine and new energy models,providing users with a full range of travel experiences.By totally renewing and adhering to its brand positioning of becoming a trusted partner for families seeking outdoor adventures,Beijing Brand has created three major product series,namely the Excellent Off-road Perform
45、ance,the Joyful Adventure and the Pleasure Experience.The Excellent Off-road Performance series is positioned as an off-road vehicle product characterized by hardcore,reliable,all-around,military-quality performance.The Joyful Outdoor Adventure series is positioned as a stylish,multi-functional SUV
46、product.The Pleasure Travel Experience series is positioned as a multi-purpose product featuring an integrated intelligence,real family-shared enjoyment and technological style.Internal combustion engine vehicles on sale include the new BJ40,BJ60 and other off-road models,as well as the new X7,the n
47、ew Magic Cube and other SUV models.The new energy models include EU5,EU7 and the new EU5 PLUS and others.2.Beijing BenzBeijing Benz Automotive Co.,Ltd.(“Beijing Benz”)is a subsidiary of the Company.The Company holds 51.0%equity interest of Beijing Benz,while Mercedes-Benz Group and its wholly-owned
48、subsidiary,Mercedes-Benz Group China Ltd.(梅賽德斯奔馳（中國）投資有限公司),together hold another 49.0%equity interest in Beijing Benz.Beijing Benz commenced the manufacturing and sales of passenger vehicles of Mercedes-Benz brand in 2006.BAIC Motor Corporation Limited ANNUAL REPORT 20238Section IV Company Profile
49、and Business OverviewAt present,Beijing Benz has become a joint venture integrating research and development,vehicle and engine production,sales and after-sales service.It has commenced production of internal combustion engine vehicles such as the E-Class long-wheelbase sedan and the long-wheelbase
50、GLC SUV.Additionally,Beijing Benz has introduced various all-electric SUV models,including the EQA SUV,the EQB SUV,and the EQE,which are based on the further development of the EVA all-electric platform,as well as the brand-new EQE all-electric SUV.In addition,Beijing Benz also exports core parts an
51、d components of engines and vehicles,which makes itself an important part of the global network of Mercedes-Benz.3.Beijing HyundaiBeijing Hyundai Motor Co.,Ltd.(“Beijing Hyundai”)is a joint venture of the Company.The Company holds 50.0%equity interest of Beijing Hyundai through its subsidiary BAIC I
52、nvestment Co.,Ltd.(“BAIC Investment”),while Hyundai Motor holds another 50.0%equity interest of Beijing Hyundai.Beijing Hyundai has been manufacturing and selling Hyundai passenger vehicles since 2002.Beijing Hyundai has established an industry-leading quality operation system and has a nationwide l
53、eading production and manufacturing plant.It produces and sells a wide range of compact and mid-size sedans and SUVs,including the Elantra CN7,the LA FESTA N-line,the tenth-generation Sonata,the fifth-generation Tucson L,the all-new updated ix35 the MUFASA,the fourth-generation Santa Fe,and the Cust
54、o,etc.With these models,Beijing Hyundai fully caters to various consumer needs.4.Fujian BenzFujian Benz Automotive Co.,Ltd.(“Fujian Benz”)is a joint venture of the Company.The Company holds 35.0%equity interest of Fujian Benz,and establishes an acting-in-concert agreement with Fujian Motor Industry
55、Group Co.,which holds another 15.0%equity interest of Fujian Benz.The consensus will be reached while making decisions regarding the operation,management and other matters of Fujian Benz,as well as the exercising of power by the directors appointed by Fujian Motor Industry Group Co.Mercedes-Benz Van
56、s Hong Kong Limited holds the remaining 50.0%equity interest of Fujian Benz.Fujian Benz commenced the manufacturing and sales of multi-purpose passenger vehicles of Mercedes-Benz brand in 2010.At present,Fujian Benz stays on the leading edge in the field of joint venture premium business purpose veh
57、icles,with production and sales of Mercedes-Benz V-Class vehicles and New Vito products.Core Parts and Components for Passenger VehiclesIn addition to manufacturing of vehicles,we also produce engines,powertrain,power batteries and other core parts and components for passenger vehicles through the m
58、anufacturing bases of Beijing Brand,Beijing Benz and Beijing Hyundai.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 9Section IV Company Profile and Business OverviewWe manufacture engines,transmissions,new energy reducer and other core automobile parts and components through entities including BA
59、IC Motor Powertrain Co.,Ltd.(“Powertrain”)mainly for use in our self-produced vehicles as well as for sale to other automobile manufacturers.Through the combination of cooperative and independent development,we have broken through many technological difficulties,successively completed the developmen
60、t of many types of internal combustion and hybrid engines and transmission products,and put them into mass production.Such products have been widely used for Beijing Brand passenger vehicles.Beijing Benz currently has two engine factories and the first power battery factory outside of Germany,produc
61、ing a variety of engines such as M282,M274,M260A,M254 and other EB42X power batteries with ternary lithium batteries with higher energy density.Beijing Hyundai has been manufacturing engines since 2004.Its specific product offerings cover four major series namely BETA,Kappa,Gamma and GammaII.The eng
62、ines produced are industry-leading in terms of technology and power,etc.The products are mainly used in Hyundai passenger vehicles manufactured by Beijing Hyundai.Car FinancingWe conduct car financing and automobile after-sales business of Beijing Brand,Mercedes-Benz brand and Hyundai brand through
63、associates and joint ventures including BAIC Group Finance Co.,Ltd.(“BAIC Finance”),Mercedes-Benz Leasing Co.,Ltd.(“MBLC”),Beijing Hyundai Auto Finance Company Limited(“BHAF”)and BH Leasing Co.,Ltd.(“BH Leasing”)and continuously promote the rapid development of car financing businesses by methods in
64、cluding capital investment and business cooperation.In respect of car financing business,we have conducted group strategic cooperation with various automobile financial companies,commercial banks and finance lease companies,offering clients a great variety of financial products covering all car mode
65、ls for sale and meeting different customer demands.BAIC Motor Corporation Limited ANNUAL REPORT 202310Section IV Company Profile and Business OverviewInternational BusinessWe conduct the international marketing business through a wholly-owned subsidiary BAIC International,to promote the rapid develo
66、pment of international business through overseas sales companies,KD technology3 cooperation,vehicle distribution,etc.In addition,BAIC Automobile SA Proprietary Limited(“BAIC Automobile SA”),a non-wholly-owned subsidiary of the Company,is responsible for the production and operation businesses of the
67、 South African production base and the marketing business in South African and Southern African Development Community(SADC)markets.III.CORE COMPETITIVENESSThe Group adheres to sales as the key driver of reform,products as the cornerstone of development,and quality as the core value.It steadily promo
68、tes high-quality development despite fierce market competition and continuously enhances its core competitiveness.3 means Knocked-down1.Enhancing innovative product forms to meet increasingly diverse needsThe Companys passenger vehicle brand portfolio is profoundly competitive and highly complementa
69、ry and can satisfy the purchase demands of different groups for vehicles at different stages by leveraging our comprehensive product-defined development strategy.In terms of brand portfolio,Beijing Brand adheres to transition to new energy and intelligence.By identifying market opportunities and int
70、egrating the entire value chain of research,production,supply,and sales,it has developed key local advantages and effectively enhanced product competitiveness.Beijing Benz has established a comprehensive intelligent factory characterized by digitalization,flexibility,efficiency,and sustainable produ
71、ction.With the steady progress of new product introductions,it aims to further solidify its leading position in the high-end premium vehicle market.With a focus on research and development as well as innovation,Beijing Hyundai adheres to comprehensively upgrading its product lines,by accelerating th
72、e introduction and application of new technologies including the transition to new energy vehicles,intelligence and networking.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 11Section IV Company Profile and Business OverviewIn terms of product definition,the Company continuously updates and impro
73、ves product theory and user insight system.It focuses on multi-level market trend prediction and multi-dimensional insight into core user demands,aiming to optimize highly sensory functional experience.A dual evaluation mechanism involving experts and users is adopted to evaluate the implementation
74、of product strategy in a comprehensive manner,with a goal of continuously providing excellent products for the market and users.2.Diversified equity structure and good strategic partnershipBAIC Group,a Controlling Shareholder of the Company as well as one of the main automobile groups in China,has e
75、stablished a relatively complete automobile industry chain covering businesses including research,development and manufacturing of vehicles,components and parts,automobile service trade,comprehensive commuting service,finance and investment.Other Shareholders of the Company include state-owned inves
76、tment platforms,Mercedes-Benz Group,key state-owned enterprises,related strategic and financial investors,which is a diversified and internationalized equity structure.Such diversified equity structure is conducive to sufficient utilization of resources of Shareholders,improvement in the management
77、ability by the Company and deep exploitation of the development potential of the Company.The Company has established close joint venture and cooperation relationships with Mercedes-Benz Group,Hyundai Motor and other famous enterprises in the industry,and has further expanded the breadth and depth of
78、 the cooperation.In addition to establishment of Beijing Benz,Fujian Benz,Beijing Mercedes-Benz Sales Service Co.,Ltd.(“Benz Sales”)and MBLC by the Company and Mercedes-Benz Group,both parties have cooperated and exchanged with each other in technology,platform,human resource and other aspects to a
79、greater extent.Close cooperation with strategic partners enhances the research and development ability of the Company,expands the talent team and enriches the experience of the Company in management,production and operation.3.Experienced management team and core research and development teamThe mana
80、gement team has extensive industry and management experience as well as multidisciplinary and compound knowledge systems and professional skills.They broaden the international vision rooted in local culture and ensure that the Company is able to formulate efficient and farsighted research and develo
81、pment strategies by grasping the future development trend and technologies of passenger vehicles and the law of industry development.Meanwhile,with the continuous improvement and optimization of the training system,the Company has carried out comprehensive improvement and continuously made progress
82、in terms of pioneering,leading,basic and professional strengths.BAIC Motor Corporation Limited ANNUAL REPORT 202312Section IV Company Profile and Business OverviewThe Company is committed to developing the first-class research and development strength and has a research and development team with exc
83、ellent quality and reasonable structure.The core research and development team consists of international and domestic senior professionals in relevant fields,including intelligent networking,technologies of battery,motor and control,vehicle integration,NVH,powertrain,chassis framework etc.,with stro
84、ng strength and rich experience in research and development.The team fully promotes independent innovation,creates core technologies in depth,and continuously develops its own core strength.The team has continuously made achievements,with the capacity for the development of complete vehicle systems,
85、core parts and components,and integrated development of key sub-system technology and vehicle system.It is an important research and development organization for passenger vehicles of Beijing Brand.4.Geographic advantage of headquarters in BeijingThe headquarters of the Company is located in Beijing
86、,the capital of China,where there are many scientific research institutions,colleges and universities,a great number of industry experts and talents,and the Company is able to obtain more high-quality human resource support,attract high-end industry talents and keep abreast of new technologies and b
87、reakthroughs in the industry in a timely manner,in order to support the improvement in the research and development strength of the Company.Meanwhile,Beijing boasts more convenient transportation,a more developed logistics system,more complete supporting facilities and infrastructures,which satisfy
88、the demands of the Company for support necessary for production and operation.5.Advanced manufacturing,techniques,quality and process managementWe have specialized production facilities to manufacture and assemble passenger vehicles to improve efficiency and maintain product quality standards.All of
89、 our production facilities are equipped with flexible production lines,as such we can apply differentiated production processes for different types of passenger vehicles.In order to ensure high quality operation of production,we carry out regular maintenance of the production facilities.Meanwhile,we
90、 have set up and implemented stringent quality control systems that comply with national and international standards,as we attach great importance to the consistency of product quality.IV.CONTROLLING SHAREHOLDERBAIC Group is the sole Controlling Shareholder of the Company and held 46.37%equity inter
91、est in the Company as of the Date of Issue of the Report.BAIC Group is one of the major automobile manufacturing groups in China and has been ranked among the worlds top 500 companies for 11 consecutive years.BAIC Group has an operating history of over 60 years.It has now developed into a comprehens
92、ive and modern automobile conglomerate with diversified business portfolio and integrating vehicle research and development and manufacturing,parts and components manufacturing,automobile service trade,education and investment and financing business,as well as incubation of new industries.The Group
93、is a key platform established by BAIC Group for passenger vehicle resource integration and business development.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 13Section IV Company Profile and Business OverviewV.BRIEF OF EQUITY STRUCTUREThe following chart sets out the major shareholding and inves
94、tment structure of the Company as at December 31,2023(the“end of 2023”):50%97.95%35%100%100%100%100%51%49%100%100%100%44.50%9.55%12.83%11.22%21.90%50%40%33%20%14%100%50%35%10.99%54%4.81%65%Other DomesticShareholdersBAIC GroupShougang GroupH Shares PublicShareholdersMercedes-BenzGroupBAIC Motor Corpo
95、ration LimitedBAIC Investment Co.,Ltd.BAIC International Development Co.,Ltd.Beijing BranchZhuzhou BranchBAIC Guangzhou Automotive Co.,Ltd.Beijing Motor Sales Co.,Ltd.Zhuzhou(BAIC)Motor Sales Co.,Ltd.BAIC Hong Kong Investment Corp.BAIC Motor Powertrain Co.,Ltd.Beijing Benz Automotive Co.,Ltd.Beijing
96、 Mercedes-Benz Sales Service Co.,Ltd.Fujian Benz Automotive Co.,Ltd.Beijing Beinei Engine Parts and Components Co.,Ltd.BAIC BluePark New Energy Technology Co.,Ltd.China Automobile Development United(Beijing)Technology Investment Co.,Ltd.Mercedes-Benz Leasing Co.,Ltd.BAIC Group Finance Co.,Ltd.Beijin
97、g Hyundai AutoFinance Co.,Ltd.Hyundai Top Selection U-Car Co.,Ltd.Beijing Hyundai Motor Co.,Ltd.BAIC Automobile SA Proprietary LimitedAs of the Date of Issue of the Report,BAIC Group has been transferred 150 million domestic shares of the Company held by Shenzhen Benyuan Jinghong Equity Investment F
98、und Enterprise(Limited Partnership),which in aggregate held 46.37%equity interest in the Company.BAIC Motor Corporation Limited ANNUAL REPORT 202314BEIJING BRAND MAJOR MODELBJ30BJ60 NEW BJ40ANNUAL REPORT 2023 BAIC Motor Corporation Limited 15NEW MAGIC CUBENEW X7NEW EU5 Plus BAIC Motor Corporation Li
99、mited ANNUAL REPORT 202316BEIJING BENZ MAJOR MODELGLC L SUVEQE SUVE-Class LANNUAL REPORT 2023 BAIC Motor Corporation Limited 17BEIJING HYUNDAI MAJOR MODELGLC L SUVEQE SUVE-Class LTUCSON LSONATAMUFASABAIC Motor Corporation Limited ANNUAL REPORT 202318Section IV Company Profile and Business OverviewVI
100、.THE INDUSTRY DEVELOPMENT OF PASSENGER VEHICLES DURING 2023In 2023,the passenger vehicle market saw a gradual improvement in sales volume,despite a slow start.Several indicators reached record highs,reflecting effective enhancements in quality and reasonable growth in volume.This development became
101、a significant driving force for industrial economic growth.According to the data of CAAM,the sales volume of passenger vehicles in 2023 was 26.063 million units,representing a year-on-year increase of 10.6%,which showed a steady development trend.At the beginning of 2023,due to the impact of industr
102、y policy transition and insufficient release of effective demand,there was a decline in the sales volume of passenger vehicles.Since the second quarter,sales volume has rebounded with the launch of various promotional policies.In the second half of the year,the mild recovery of the macro-economy has
103、 gradually impacted the automobile market,and the good performance of new energy vehicles and automobile exports has effectively boosted market growth.As policies gradually pan out,the consumption potential of the automobile market has been further unleashed,which helped the industry achieve stable
104、growth throughout the year.According to the data of CAAM,new energy passenger vehicle sales in the first half of the 2023 amounted to 9.046 million units,representing a year-on-year increase of 38.2%,with a market share of 34.7%,demonstrating a period of comprehensive market expansion;the sales volu
105、me of Chinese-brand passenger vehicles amounted to 14.596 million units in 2023,a year-on-year increase of 24.1%,with a market share of 56.0%;sales of premium brand passenger vehicles amounted to 4.516 million units,a year-on-year increase of 15.4%;and exports of passenger vehicles amounted to 4.140
106、 million units,a year-on-year increase of 63.7%.In terms of industrial policies,the domestic economy in 2023 benefitted from the policies to stabilize growth.Various ministries jointly issued the Announcement on the Continuation and Optimization of Tax Reduction and Exemption Policies for Purchase o
107、f New Energy Vehicles,announcing that the tax reduction and exemption policies for purchase of new energy vehicles will be extended to 2027,further unleashing the consumption potential for new energy vehicles,which will help to stabilize the market expectation and expand the effective demand.VII.BUS
108、INESS OPERATIONS OF THE GROUP IN 2023The Group made significant progress with a fresh start in 2023,consolidating its development base and optimizing its product lineups.It adhered to the operational philosophy of Survival,Reform,and Development,fully fulfilling its core mission of Sales Increase.We
109、 fully leveraged the strengths of the internal combustion engine vehicle business to explore market potential while transforming and upgrading the new energy business to build momentum.We recorded an annual sales of 1,042,000 vehicles,a year-on-year increase of 7.3%4,achieving a synergistic developm
110、ent of the entire value chain and a breakthrough in the core business.Comprehensive promotion of new energy transformationIn 2023,the Group strengthened strategic cooperation in the realm of new energy transformation by increasing its equity interest in BAIC BluePark as part of its ongoing expansion
111、 in the new energy business.By accelerating implementation of a number of new energy platform projects,the Group consolidated its development foundation and facilitated the new 4 Sales volume of Beijing Brand off-road vehicles are included in the sales volume for 2022 for comparison.ANNUAL REPORT 20
112、23 BAIC Motor Corporation Limited 19Section IV Company Profile and Business Overviewenergy transformation.The Beijing Benz EQ series,Beijing Hyundais 2025 New Plan and Fujian Benzs Future Star Products were implemented in parallel to accelerate the introduction of the worlds best-selling new energy
113、models and to complement the product matrix.At the same time,the development of range-extending off-road models represented by the BJ60 and the new BJ40 expedited the research of the core hybrid models.The new EQE all-electric SUV was launched on schedule,defining the“New Luxury”outstanding vehicle
114、through the electric transformation of star products.During the Reporting Period,the Group achieved sales of 102,000 new energy vehicles,a year-on-year increase of 46.6%.Further expansion of overseas marketsIn 2023,with focus on dual strategic markets in China and beyond,the Group prioritised the im
115、provement of the channel management capabilities of international business to enhance basic management capabilities and industry chain synergies.We continued to deepen the terminal marketing control in the base market,focused our resources on promoting the economies of scale in special markets,activ
116、ely developed new markets such as Europe,Central Asia and Southeast Asia,and expanded new businesses such as electric vehicles and used cars,so as to achieve high growth in system capacity,market scale and profitability.During the Reporting Period,the Company achieved 59,000 vehicle exports,represen
117、ting a year-on-year growth of over 200%,a growth rate that significantly exceeds the industry standard level and has become a stable growth point.In addition,in 2023,the construction of the South African plant was completed and the South African plant commenced the production while the marketing sys
118、tem was initially established.With a foothold in South Africa,we radiated our influence to Africa,the European Union and other regions,realizing the continuous expansion of overseas markets.The Magic Cube model won the Car of the Year(COTY)for“Best Family SUV”in South Africa and Top Gears“2023 Reade
119、rs Choice Model”award.Brand-new upgrade of product offeringsBy adhering to the product-centered and demand-oriented approach,the Group continued to improve product refinement and system upgrade,strengthen its market positioning,and promote the popularization and innovation of its design language.Dur
120、ing the Reporting Period,the brands of the Group released more than 10 new models,including the new X7,the new Magic Cube,the all-new EU5 PLUS,the all-new E-Class long-wheelbase model,the new-generation GLC,the all-new EQE all-electric SUV,the new MUFASA,the Elantra CN7 facelift version and the N-li
121、ne,which continued to promote the sales conversion and solidify the foundation for the Companys development.At the same time,the Company broadened its product lineups and entered the crossover off-road vehicle market,successfully incorporating in the entire value chain of off-road vehicles and bring
122、ing a more unique definition to the“off-road”era.The Excellent Off-road Performance series,represented by the BJ60,focuses on crossover off-road and cozy outdoor adventures,integrating wisdom,comfort and safety into all aspects of vehicle life scenarios and creating a new concept of comfortable off-
123、road experience,which has become a driving force for sales growth.BAIC Motor Corporation Limited ANNUAL REPORT 202320Section IV Company Profile and Business OverviewSignificant development of Beijing BrandIn 2023,Beijing Brand underwent a comprehensive transformation,encompassing its brand,technolog
124、y,and ecological approach.It adhered to the brand values of harmony,coziness,and joyfulness,leveraging the four platforms of Jimu 2.0 Vehicle Technology,Borderless Off-road Technology,Pioneer Intelligence Technology,and Magic Core Power Technology.The Company embraced the eco-branding concept of dev
125、elopment,sharing,co-creation,and shared success,leading to the construction of a diverse mainstream product matrix across various classes and dynamics.During the Reporting Period,Beijing Brand extensively explored the seven business lines of brand,product,channel,marketing,finance,service,and user o
126、peration.Simultaneously,it focused on enhancing commodity definition,product development,and marketing.The Magic Cube,X7,and BJ60,serving as its main models,continued to evolve,while the flagship model of the all-new BJ40 excelled in niche markets,and the sales volume of Beijing Brand exceeded 160 t
127、housand vehicles and achieved competitive growth throughout the year.Technology-driven and innovation-led growthAs the Group believes that research and development capability is crucial to its future development,it continued to reinforce its research and development system and capability constructio
128、n,with research and development expenditure for 2023 increasing by over 30%year-on-year.In terms of energy and power,Beijing Brand advanced the development of high thermal efficiency engines and range-extending systems.In 2021,the self-developed“Magic Core”1.5T engine was honored with the“Heart of C
129、hina”Top Ten Engine of the Year award.In 2023,two hybrid engines had entered mass production.The Magic Core became one of the first products in China to receive the“Star of Silence for Engines”certification,and self-designed hybrid engines have steadily improved their NVH performance,moving towards
130、a leading position in China.Beijing Benz has established the largest-scale research and development center among joint ventures under the Mercedes-Benz Group,along with the only fully functional prototype plant located overseas.This facility allows the Company to conduct high-quality localized proto
131、type trials,resulting in a substantial reduction in the validation cycle for new product introductions and an increased level of product maturity.Meanwhile,Beijing Benz has a high-level research and development team,with a leading level technology in China in localization of components,product intro
132、duction and problem analysis,digital verification of research and development,problem analysis of new energy electric drive/battery systems,implementation and verification of localized technology solutions,and engineering change control.Beijing Hyundai continued its efforts to enhance the localizati
133、on of the 8AT transmission and expedited product replacements and upgrades.Through research on XEV,EV,and other new energy power technologies,the Company is actively advancing the pace of electrification.In terms of intelligence,Beijing Brand promoted the independent innovation and strategic coopera
134、tion in parallel,making breakthroughs in core technologies and core capabilities.It has built a unified hardware platform and software ecosystem for future products,to create an AI-enabled“intelligent system”for vehicles.Simultaneously,the Beijing Brand expanded the application of internationally so
135、urced main chips,and developed two main business lines for both domestic and imported chips.Furthermore,it constructed a versatile and adaptable“third space”built upon the cockpit domain control platform.With a continuous understanding of market dynamics in China,Beijing Hyundai introduced the MUFAS
136、A models,a new category of“intelligent two-room,ANNUAL REPORT 2023 BAIC Motor Corporation Limited 21Section IV Company Profile and Business Overviewone-compartment”SUVs.These models boast class-leading intelligence,spaciousness,safety performance,and cost-efficiency,catering to the requirements of y
137、oung families in China.In addition,Beijing Hyundai has cooperated with top ICT enterprises in China to promote the integration of localized ecology in China,constructed high-level development blueprints,established an OTA management mechanism,and strengthened the capabilities of digital product deve
138、lopment and software-defined automobiles.In terms of off-road vehicle technology,Beijing Brand created off-road ATS technology and adopted unique body structures such as cage body and all-metal anti-roll bar,which comprehensively improves the safety performance in off-road.It launched the first off-
139、road SUV with unladen body+four-wheel independent suspension,ensuring off-road performance and comfort at the same time.Green development with responsibilityThe Group adhered to the development philosophy of“Innovation,Coordination,Green,Openness,and Sharing”,proactively responding to the national“D
140、ual Carbon”guideline.It carried out various energy-saving and emission reduction initiatives,reducing the carbon footprint of its products.The Group continued to increase the proportion of green power usage,promoted technical upgrades in its painting workshops,and focused on establishing a green fac
141、tory.Meanwhile,the Group has persisted in exploring the path of high-quality and sustainable development.It was recognized as the“Wind ESG 2022 Best Practice Listed Company”,with its practices also featured in the“Blue Book of Environmental,Social,and Governance(ESG)for Beijings State-Owned Listed C
142、ompanies”.Production FacilitiesWe have specialized production facilities to manufacture and assemble products.All of our production facilities are equipped with flexible production lines.This not only enables us to flexibly change production plans and respond quickly to changes in market demand,but
143、also reduces our capital expenditures and operating costs.The Zhuzhou and Guangzhou plants of Beijing Brand have implemented an advanced digital and intelligent production quality management system,which focuses on enhancing the design and manufacturing processes of vehicle products,continuously imp
144、roving the accuracy of implementing digital standards and enhancing product quality.Guided by the principle of“digitization,flexibility,effectiveness and sustainability”,Beijing Benz continuously builds Mercedes-Benzs most comprehensive production base in the world to continuously promote its own hi
145、gh-quality development.Beijing Benz has established a quality centre based on Mercedes-Benz Groups global standards to ensure that every unit of Mercedes-Benz vehicles is up to its globally unified standards and quality management system.Upholding the production philosophy of“greenness,quality,intel
146、ligentization and high efficiency”,Beijing Hyundai relies on intelligent production equipment,international management systems and more than 90%automation rate to fully ensure accuracy and manufacture high-quality products.In the meantime,it reasonably uses flexible production plans and mixed model
147、production to effectively reduce manufacturing costs.BAIC Motor Corporation Limited ANNUAL REPORT 202322Section IV Company Profile and Business OverviewSales NetworkThe Group always attaches great importance to the rights and interests of customers and strives to optimize its product-service system,
148、aiming to enable product distributors and customers to receive timely,efficient,accurate and high-quality services.There are independent marketing channels for all brands.Beijing Brand embarked on a new journey,leveraging innovative marketing and the operation of a new media matrix to drive up onlin
149、e sales at the end terminals,and continued to optimize channel layout.The service end closely focused on customer pain points and drove service ecosystem construction,while the customer end concentrated on clubs,APPs and word-of-mouth communication deepening systematized operations.Beijing Benz cont
150、inued to promote the network upgrade program,and constantly improved the image upgrade,function optimization,process design and service team of offline outlets,which helped improve the customer experience and the operational efficiency of dealers to a new level.At the same time,it focused on digital
151、 marketing based on data and new media,and strengthened dealer training and talent development to digitally empower retail and support business development.Beijing Benz kept a close eye on the profitability of dealers and pushed forward their efforts to improve quality and increase efficiency by foc
152、using on key cost items.Beijing Hyundai has actively promoted the optimization of its network layout and continued to enhance the healthy development of its channels.Through innovative marketing strategies focusing on trending topics and increased technical brand identity publicity,it boosted the po
153、pularity of its brand and models.Beijing Hyundai continued to promote fan marketing to achieve accurate marketing/service/lead management,facilitating the conversion of customer value.Industry chain extension and cooperationIn 2023,the Group continuously promoted the integration of industry and fina
154、nce and industrial cooperation in various fields,further optimized the industry chain covering research,production,supply and marketing,focused on principal businesses and enhanced its competitiveness.On July 15,2022,the Company and BAIC BluePark,an A-share listed subsidiary of BAIC Group,entered in
155、to a share subscription agreement,pursuant to which BAIC BluePark conditionally agrees to issue to the Company,and the Company conditionally agrees to subscribe for,not less than 35.99%of the total number of new A shares actually issued under the A share issuance of BAIC BluePark.The subscription pr
156、ice per new A share shall be determined in accordance with the pricing principle in respect of the A share issuance and the total subscription amount payable by the Company shall not exceed RMB2.879 billion.The subscription was approved at the general meeting of the Company on August 26,2022 and the
157、 registration of the subscribed new A shares was completed on May 25,2023 at the Shanghai Branch of China Securities Depository and Clearing Corporation Limited.Upon the completion of the subscription,the Company and BAIC Guangzhou Automotive Co.,Ltd.hold approximately 10.99%and 4.81%of the total is
158、sued A shares of BAIC BluePark,respectively.Please refer to the relevant announcement of the Company for details of the above collaboration.In the future,the Group will focus on its overall business strategy,optimize effective cooperative relationships and support the Groups various business reform
159、efforts to further enhance its competitive strength.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 23Section IV Company Profile and Business OverviewVIII.PROSPECT FOR THE DEVELOPMENT OF PASSENGER VEHICLE INDUSTRY IN 2024In 2024,Chinas macro-economy will remain at the stage of seeking progress ami
160、dst stability with an overall stable economy.With relevant support from policies and the joint efforts of enterprises,the market and consumer dynamics will be further stimulated.Chinas passenger vehicle market will sustain a stable and positive development trend in the future.According to the CAAMs
161、prediction,Chinas vehicles sales in 2024 will grow by more than 3%.CAAM and relevant authorities believe that the main trend of the macroeconomy and the development of the automobile industry in 2024 will be as follows:1.Macroeconomic growth is about to gradually get back to normal and favourable po
162、licies will be introducedIn 2024,China will prioritize economic construction and high-quality development,intensifying macro-control efforts.The country will continue to effectively enhance economic structure and efficiency while ensuring appropriate growth in the scale of economic development.Macro
163、 policies support the research and development as well as the application of cutting-edge technologies such as new energy and artificial intelligence,synchronize residents income growth with economic development and cultivate new hotspots for emerging consumer industries.Policies aimed at stabilizin
164、g growth and expanding domestic demand are expected to revive grassroots consumption,which is expected to lead a steady growth in GDP.2.Chinas automotive market will show a stable,positive development trendIn 2024,the mild macro-economic recovery will gradually impact the automobile market.With the
165、ongoing promotion of national policies aimed at optimizing the structure of the automobile industry and guiding industry layout rationally,along with the implementation of various initiatives such as robustly promoting new energy vehicles,advancing the application of intelligent Internet technologie
166、s,and fostering the high-quality development of the automobile industry,the automotive market in the PRC is expected to demonstrate a stable and improving development trend.3.Favourable policies will boost the new energy market demandIn 2024,the ongoing promotion of national policies to boost consum
167、ption and stabilize growth,along with the implementation of a series of initiatives aimed at promoting the high-quality development of the new energy automobile industry such as the continuation of the vehicle purchase tax exemption policy and the extensive promotion of new energy vehicles and infra
168、structure construction in rural areas will further stimulate market vitality and consumption potential.This,in turn,will lead to further release of demand in the new energy market.IX.OPERATIONAL STRATEGY OF THE GROUP FOR 2024In 2024,the Group will continue to implement the business policy of Surviva
169、l,Reform,and Development.It will seize new opportunities in the international market,incorporate concepts of high-quality and sustainable development into its operations,and expedite the transformation into a new energy-based business.Beijing Brand will focus on the dual strategy markets“domestic an
170、d international”development while continuing to promote its three products series,to enhance its brand structure upgrade.Beijing Benz will make consistent efforts to promote the Three Transformations development strategy and accelerate the launch of the new all-electric platform.Adhering to the phil
171、osophy of experience accumulation,transformation,and reform,Beijing Hyundai will uphold its core mission of promoting sales of internal combustion engine vehicles,facilitating electric vehicle transformation,expanding exports,and strengthening the system.Fujian Benz will continue to prioritize econo
172、mic efficiency,enhance product presence,and steadily advance the transformation towards electrification.BAIC Motor Corporation Limited ANNUAL REPORT 202324Section V Management Discussion and AnalysisREVENUE AND NET PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANYThe Group is principally engaged
173、in the research and development,manufacturing,sales and after-sales services of passenger vehicles.The above businesses have brought sustained and stable revenue to the Group.The revenue of the Group increased from RMB190,462.6 million in 2022 to RMB197,949.2 million in 2023,representing a year-on-y
174、ear increase of 3.9%,mainly attributable to the increase in revenue from the sales of new energy vehicles.Revenue relating to internal combustion engine vehicles increased from RMB182,499.4 million in 2022 to RMB182,697.2 million in 2023,representing a year-on-year increase of 0.1%,mainly attributab
175、le to(i)the year-on-year increase in sales volume;and(ii)the increase in the proportion of the sales volume of models with relatively lower selling prices partially offsetting the rise in sales volume.Revenue relating to new energy vehicles increased from RMB7,963.2 million in 2022 to RMB15,252.0 mi
176、llion in 2023,representing a year-on-year increase of 91.5%,mainly attributable to(i)the year-on-year increase in sales volume;and(ii)the increase in the proportion of the sales volume of models with relatively higher selling prices,leading to the increase in the revenue exceeding the increase in sa
177、les volume.The Groups net profit attributable to equity holders of the Company decreased from RMB4,196.6 million in 2022 to RMB3,030.3 million in 2023,representing a year-on-year decrease of 27.8%.The basic earnings per share decreased from RMB0.52 in 2022 to RMB0.38 in 2023.GROSS PROFITThe Groups g
178、ross profit decreased from RMB42,334.2 million in 2022 to RMB40,070.5 million in 2023,representing a year-on-year decrease of 5.3%,mainly due to the decrease in gross profit from internal combustion engine vehicles and new energy vehicles.Gross profit from internal combustion engine vehicles decreas
179、ed from RMB44,549.9 million in 2022 to RMB43,369.8 million in 2023,representing a year-on-year decrease of 2.6%,mainly resulting from the change of the vehicle model structure.Gross profit from new energy vehicles decreased from RMB-2,215.7 million in 2022 to RMB-3,299.4 million in 2023.Although the
180、 average gross profit margin of new energy vehicles was still negative,the profitability per vehicle has improved due to the increased sales volume.WORKING CAPITAL AND FINANCIAL RESOURCESThe Group usually satisfied its daily working capital requirements through self-owned cash and borrowings.The Gro
181、ups net cash generated from operating activities increased from RMB18,654.1 million in 2022 to RMB24,248.9 million in 2023,representing a year-on-year increase of 30.0%,mainly due to the increase in net cash inflow from operating activities.As at the end of 2023,the Group had cash and cash equivalen
182、ts of RMB31,124.2 million,notes receivable of RMB5,590.7 million,notes payable of RMB6,195.5 million,outstanding borrowings of RMB13,274.9 million,unused bank credit lines of RMB32,379.7 million,and commitments for capital expenditure of RMB28,657.8 million.Included in the aforesaid outstanding borr
183、owings were US dollar borrowings amounting to RMB2,492.5 million and borrowings amounting to 7.3 million rands as at the end of 2023.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 25Section V Management Discussion and AnalysisCAPITAL STRUCTUREThe Group maintained a reasonable combination of equit
184、y and debt to ensure an effective capital structure.The Groups asset-liability ratio(total liabilities/total assets)decreased from 54.5%as at the end of 2022 to 53.0%as at the end of 2023,representing a year-on-year decrease of 1.5 percentage points,mainly attributable to the decline in the interest
185、-bearing liabilities.The Groups net gearing ratio(total borrowings less cash and cash equivalents)/(total equity plus total borrowings less cash and cash equivalents)changed from-27.3%as at the end of 2022 to-29.0%as at the end of 2023,mainly attributable to(i)a decrease in total borrowings and cash
186、 and cash equivalents;and(ii)an increase in total equity.As at the end of 2023,the total outstanding borrowings was RMB13,274.9 million,including short-term borrowings of RMB6,735.7 million in aggregate and long-term borrowings of RMB6,539.2 million in aggregate.The Group will repay the aforesaid bo
187、rrowings in a timely manner at maturity.As of the end of 2023,none of the Groups loan agreements in effect includes any agreement on the obligations to be performed by the Controlling Shareholder of the Company.In the meantime,the Group also strictly followed all the terms and conditions in its debt
188、 covenants,and no default took place.SIGNIFICANT INVESTMENTSTotal capital expenditures of the Group decreased from RMB5,520.1 million in 2022 to RMB4,899.1 million in 2023,representing a year-on-year decrease of 11.2%.Total research and development expenses of the Group increased from RMB2,712.5 mil
189、lion in 2022 to RMB3,571.2 million in 2023,representing a year-on-year increase of 31.7%,mainly due to higher investment in the relevant research and development of new energy vehicles,including off-road vehicle models.Research and development expenditures were mainly incurred by the Group for its p
190、roduct research and development activities.Based on accounting standards and the Groups accounting policy,expenses of the aforesaid research and development complied with capitalization conditions had been capitalized accordingly.MATERIAL ACQUISITIONS AND DISPOSALSThe Group did not carry out materia
191、l acquisitions or disposals of subsidiaries,associates or joint ventures during 2023.FOREIGN EXCHANGE GAINS5The Groups foreign exchange gains changed from RMB404.4 million in 2022 to foreign exchange losses of RMB278.3 million in 2023,mainly due to(i)the effective control on the foreign exchange rat
192、e risks due to the judgment in foreign exchange forward contracts;and(ii)the increase in exchange losses from Euro-denominated payments as a result of the decline in the exchange rate of RMB against Euro.The Group used foreign currencies(primarily Euro)to pay for part of its imported parts and compo
193、nents.It had borrowings denominated in foreign currencies.Foreign exchange fluctuations may affect the Groups operating results.The Group has a well-developed foreign exchange management strategy that continuously and orderly controls foreign exchange rate risks of foreign exchange exposure.At prese
194、nt,the Group mainly uses foreign exchange forward contracts as its hedging tool.5 Foreign exchange gains include foreign exchange forward contracts at fair value through profit or lossBAIC Motor Corporation Limited ANNUAL REPORT 202326Section V Management Discussion and AnalysisREMUNERATION POLICIES
195、Staff costs mainly consists of wages and bonuses(before tax),the insurances and housing fund,and supplementary pensions borne by the enterprise.Staff costs incurred by the Group increased from RMB5,809.1 million in 2022 to RMB5,968.8 million in 2023,representing a year-on-year increase of 2.7%,which
196、 was mainly attributable to the increase in cost caused by the increasing production and sales volume,increasing working hours and the rising annual average social wage.Through the implementation of its human resources strategy,the Group has established a performance-and competence-oriented remunera
197、tion system on the basis of job classification.The annual business objectives are linked to the performance appraisal of employees via a performance appraisal system,providing an effective guarantee for the Group to recruit,retain and motivate talents,and carry out its human resources strategy.In ad
198、dition,the Group has established an enterprise annuity system to provide the qualified and voluntary employees with the supplementary pension system with certain guarantee on retirement income.PLEDGE OF ASSETSAs at the end of 2023,the Group had pledged bills receivable amounting to RMB3,701.6 millio
199、n.CONTINGENT LIABILITIESAs at the end of 2023,the Group had no material contingent liabilities.PRINCIPAL RISKS AND UNCERTAINTIES1.Risks relating to macroeconomic volatilityMacroeconomic performance will have an impact on consumer demands for automobiles,and therefore will affect the Groups operating
200、 performance.If Chinas economic growth slows down,the purchasing power of residents will be affected,leading to a decrease in the customer demand for the Groups products,thus adversely affecting the Groups financial situation,operating results and prospects.The Group will continuously pay attention
201、to Chinas macroeconomic situation,and take measures in due course to respond to fluctuations in the economic environment.2.Risk of increased market competitionThe Group operates in a highly competitive industry with fierce market competition.According to the statistics of CAAM,in 2023,the sales volu
202、me of passenger vehicles in China was 26.063 million units,representing a year-on-year increase of 10.6%,demonstrating a steady development trend.The automobile industry,as one of the new driving forces to promote the quality of the economy,is expected to further restructure and upgrade under greate
203、r pressure.In addition,the industry will experience continuous technological reforms in the development of electrification,networking and intelligence.It is expected that the market size of new energy vehicles will further expand,bringing intensified market competition.If the Group fails to take app
204、ropriate measures to maintain and improve its market position,its future results of operations will be adversely affected.The Group will continuously pay attention to the market conditions and take measures in due course to maintain and improve its market position.3.Risks relating to the price fluct
205、uation and supply of raw materialThe key raw materials used by the Group in the research and development,production and sales of automobiles include steel,power batteries,aluminum,rubber,plastics and paint,etc.With the increase in production and sales,the volume of production factors procured by the
206、 Group from suppliers has also increased year-on-year.Chip shortage and increased prices of bulk raw materials will adversely affect the Groups results of operations.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 27Section VI Report of the Board of DirectorsThe Board of Directors hereby presents
207、the report of the Board of Directors to the shareholders of the Company(the“Shareholder(s)”)and 2023 audited consolidated financial statements of the Group as prepared in accordance with the IFRS Accounting Standards issued by the International Accounting Standards Board.COMPANY PROFILE AND INITIAL
208、PUBLIC OFFERINGThe Company was incorporated as a joint stock limited company in the PRC on September 20,2010.On December 19,2014,the Companys H Shares have been listed on the Main Board of the Stock Exchange in Hong Kong Special Administrative Region(“Hong Kong”)of the PRC.BUSINESS REVIEWPlease refe
209、r to the chapters headed“Company Profile and Business Overview”on pages 7 to 23 and“Management Discussion and Analysis”on pages 24 to 26 in this report for details regarding the business conditions and principal risks and uncertainties of the Group in 2023,and the prospect of 2024.In addition,please
210、 refer to relevant information on pages 27 to 30 in this report for events after balance sheet date,information regarding the Groups environmental performance and policies,the compliance with the relevant laws and regulations that have a significant impact on the Group and the Groups relations with
211、employees,suppliers and customers in 2023.PRINCIPAL BUSINESSPlease refer to the section headed“MAJOR BUSINESS OPERATIONS”on pages 7 to 10 of“Company Profile and Business Overview”in this report for details.OUTLOOKPlease refer to the chapter headed“OPERATIONAL STRATEGY OF THE GROUP FOR 2024”on page 2
212、3 of“Company Profile and Business Overview”in this report for details.PERFORMANCEThe 2023 annual results and the financial position as at the end of 2023 of the Company and the Group are set out on pages 138 to 220 of the audited consolidated financial statements in this report.PROPERTYChanges of pr
213、operty,plant and equipment of the Group in 2023 are set out in Note 6 to the consolidated financial statements.SHARE CAPITALAs of the Date of Issue of the Report,the total share capital of the Company is RMB8,015,338,182 and is divided into 8,015,338,182 Shares,at par value of RMB1.0 per Share(compr
214、ising 5,494,647,500 Domestic Shares and 2,520,690,682 H Shares).TAXATIONThe tax position of the Group for 2023 is set out in Note 32 to the consolidated financial statements.EVENT AFTER BALANCE SHEET DATEThe details for event after balance sheet date of the Group are set forth in Note 42 to the cons
215、olidated financial statements.DISTRIBUTABLE RESERVESThe details of the change in the reserves of the Company and the Group for 2023 are set forth in Note 39 to the audited consolidated financial statements,and in the consolidated statement of changes in equity on pages 142 to 143,respectively,among
216、which the information of the reserve distributable to Shareholders is set forth in Note 39 to the consolidated financial statements.BAIC Motor Corporation Limited ANNUAL REPORT 202328Section VI Report of the Board of DirectorsPROFIT DISTRIBUTIONIn accordance with the provisions of Article 198 of the
217、 Articles of Association of BAIC Motor Corporation Limited(the“Articles of Association”),distributable profits will be determined based on either the China Accounting Standards released by the Ministry of Finance of the PRC or the IFRS Accounting Standards,whichever is lower.The Board recommends the
218、 Company to distribute a final dividend for 2023 of RMB0.13 per share(tax inclusive)in cash to the Shareholders whose names appear on the register of members at the close of business on the record date determined in accordance with the Rules Governing the Listing of Securities on the Stock Exchange(
219、the“Listing Rules”).Based on the total ordinary share capital of 8,015,338,182 shares as at the end of 2023,the aggregate cash dividend to be paid out will amount to RMB1,041,993,963.66.This proposal will be submitted to the Companys 2023 annual general meeting(the“2023 Annual General Meeting”)for c
220、onsideration and approval.The expected date of distribution will be no later than September 5,2024.For the details of the distribution of final dividend by the Company and relevant tax arrangement,please refer to the circular for the 2023 Annual General Meeting to be sent by the Company in due cours
221、e.PURCHASE,REDEMPTION OR SALE OF LISTED SECURITIESThe Company and the Group did not purchase,redeem or sell any of the Companys listed securities in 2023.MAJOR CLIENTS AND SUPPLIERSMajor clientsThe transaction amount of the top five clients of the Group in 2023 accounted for 6.2%of the Groups total
222、revenue in 2023.The transaction amount of the single largest client of the Group accounted for 3.8%of the Groups total revenue in 2023.Major suppliersThe transaction amount of the top five suppliers of the Group in 2023 accounted for approximately 54.5%of the Groups cost of raw materials used in the
223、 cost of sales in the year.The transaction amount of the single largest supplier of the Group accounted for approximately 36.8%of the Groups cost of raw materials used in the cost of sales in the year.In 2023,Mercedes-Benz Group(the largest supplier of the Group),Beijing BAIC Yanfeng Automotive Part
224、s Co.,Ltd.(the second largest supplier of the Group),and Beijing Hainachuan Automotive Parts Co.,Ltd.（北京海納川汽車部件股份有限公司）(the third largest supplier of the Group)and BAIC Group Off-road Vehicle Co.,Ltd.(“BAIC Off-road Vehicle”)(the fourth largest supplier of the Group)are the Related Parties of the Gro
225、up.None of the Directors of the Company(the“Directors”),their close associates or any Shareholders(who to the best of the Directors knowledge held more than 5%of the issued Shares of the Company)had interests in the major clients and suppliers of the Group during anytime in 2023.RELATIONS WITH EMPLO
226、YEES,SUPPLIERS AND CLIENTSThe Group provides a competitive remuneration portfolio to attract and incentivize employees.The Group reviews the employees remuneration portfolio on a regular basis and makes necessary adjustment in order to be in line with the market standard.The Group also understands t
227、hat it is of great importance to maintain good relations with suppliers and clients for the realization of the short-term and long-term goals.For the purpose of maintaining its brand competitiveness and dominance,the Group is committed to providing consistently premium products and services to clien
228、ts.In 2023,the Group had no material and significant dispute with suppliers and clients.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 29Section VI Report of the Board of DirectorsENVIRONMENTAL PERFORMANCE AND POLICIESThe Group has actively responded to the environmental policies and strictly com
229、plied with the Environmental Protection Law of the Peoples Republic of China,the Energy Conservation Law of the Peoples Republic of China,and other laws,regulations and relevant policies.In adhering to the environmental concept of“green operation for sustainable development”,it promoted cleaner prod
230、uction,developed green products through eco-design,and reduced the impact on the environment throughout the product life cycle.The Group strengthened the management and control over pollutants to reduce the impact of the production process on the environment by enhancing production efficiency,improv
231、ing technologies and processes,optimizing emission management and treatment systems as well as environmental monitoring.The Group,through the business philosophy of“improving efficiency through cost reduction”,promoted both management-related energy conservation and project-related energy conservati
232、on,explored energy-saving potential,improved energy utilization efficiency and reduced energy consumption,achieving continuous improvement in energy performance and transforming into a“carbon neutral”enterprise.It has established its operating policy of planning energy consumption,promoting energy c
233、onservation and increasing productivity and effectiveness through energy conservation.The Group saved energy through technologies and management methods,and continuously reduced its own energy consumption and carbon dioxide emissions,thus achieving the coordinated development of economic development
234、 and resource conservation.In 2023,the Group strictly complied with relevant laws,regulations and Chinas environmental policies,and established corresponding compliance operation mechanisms.It prepared the environmental,social and governance report according to the Environmental,Social and Governanc
235、e Reporting Guide issued by the Stock Exchange.For details,please refer to the chapter headed“Environmental,Social and Governance Report”on pages 78 to 131 of this report.COMPLIANCE WITH LAWS AND REGULATIONSThe Company is an exempted company incorporated in China with limited liability,and is regist
236、ered as a non-Hong Kong company under the Hong Kong Companies Ordinance.The Shares of the Company are traded on the Main Board of the Stock Exchange.The Company continuously reviews its current systems and procedures,emphasizes and strives to comply with the Company Law of the Peoples Republic of Ch
237、ina(the“Company Law”),the Listing Rules,the Securities and Futures Ordinance(the“SFO”),applicable Hong Kong Companies Ordinance,and other relevant laws and regulations which have a significant impact on the Company.The Company endeavors to safeguard its Shareholders interests,enhance corporate gover
238、nance and strengthen the functions of the Board of Directors.Laws and regulations that have a significant impact on the operation of the Group include but are not limited to the Company Law,the Regulation of the Peoples Republic of China on the Administration of Company Registration,the Securities L
239、aw of the Peoples Republic of China,the Foreign Investment Law of the Peoples Republic of China,the Civil Code of the Peoples Republic of China,the Labor Contract Law of the Peoples Republic of China,the Regulation on the Administration BAIC Motor Corporation Limited ANNUAL REPORT 202330Section VI R
240、eport of the Board of Directorson Recall of Defective Auto Products,the Provisions on the Liability for the Repair,Replacement and Return of Household Automotive Products,the Trademark Law of the Peoples Republic of China,the Patent Law of the Peoples Republic of China and the Product Quality Law of
241、 the Peoples Republic of China.In case of violation of the aforesaid laws and regulations,the Group may be subject to corresponding civil legal liabilities and administrative penalties imposed by competent authorities,or corresponding criminal liabilities if such violation constitutes a crime.The op
242、eration of the Group has always complied with national and local laws and regulations.The Group upholds honesty and integrity,and performs its social responsibility.In 2023,there was no material litigation or dispute against the Group.The Group has always been adhering to putting the exercise of pow
243、er under institutional checks,continuously improving and strengthening the Companys employee management system improvement.In 2023,the Group further deepened and perfected the management system matching with the governance requirements of listed companies,and further optimized the system which is ea
244、sy to comply with,operate and implement.Meanwhile,the Group continuously enforced the policies such as the Implementation of the Decision-making System by State-owned Enterprises for the Major Issues,Major Personnel Appointments and Dismissals,Investments in Major Projects and Use of Large Sums of M
245、oney,and the Requirements of Practice Integrity for State-owned Enterprises Leaderships.The Company and its employees have been exercising their best endeavors to strictly follow the applicable rules,laws and industry standards.The Directors are not aware of any breach of laws or regulations which h
246、ave a significant impact on the Group,nor are they aware of any litigation or cases of corruption,bribery,extortion,fraud and money laundering involving the Group in 2023.DONATIONSIn 2023,the Group did not make any donations.BANK LOANS AND OTHER BORROWINGSThe details for bank loans and other borrowi
247、ngs of the Group at the end of 2023 are set forth in Note 22 to the consolidated financial statements.DIRECTORS,SUPERVISORS AND SENIOR MANAGEMENTThe basic information of the Directors,the supervisors(the“Supervisors”)and senior management of the Company is set out in the chapter headed“Directors,Sup
248、ervisors and Senior Management”on pages 67 to 77 of this report.All Directors have obtained legal advice from law firms qualified to advise on Hong Kong law on March 21,2024 and have confirmed that they understood all the requirements of the Listing Rules applicable to them as directors of a listed
249、issuer and the possible consequences of making a false statement or providing false information to the Stock Exchange.The Company considers all the independent non-executive Directors to be independent persons pursuant to Rule 3.13 of the Listing Rules.ANNUAL REPORT 2023 BAIC Motor Corporation Limit
250、ed 31Section VI Report of the Board of DirectorsCHANGES IN INFORMATION OF DIRECTORS,SUPERVISORS AND SENIOR MANAGEMENTThe following sets out changes in information of the Directors,Supervisors and senior management from January 1,2023 to the Latest Practicable Date:Directors and SupervisorsOn June 26
251、,2023,the Company held its 2022 annual general meeting,at which Mr.Song Wei was appointed as a non-executive Director of the Company and a member of the strategy committee of the Board(the“Strategy Committee”)for a term commencing from June 26,2023 until the expiration of the term of the fourth sess
252、ion of the Board.On June 28,2023,Mr.Huang Wenbing ceased to be an executive Director,a member of each of the Strategy Committee,the remuneration committee of the Board(the“Remuneration Committee”)and the nomination committee of the Board(the“Nomination Committee”)due to work adjustment.On June 30,20
253、23,in view of Mr.Song Weis participation in daily operation and management of the Company due to job reassignment,he was re-designated from a non-executive Director to an executive Director with effect from June 30,2023.On the same day,the Board resolved to appoint Mr.Song Wei as a member of each of
254、 the Remuneration Committee and the Nomination Committee for a term commencing from June 30,2023 until the expiration of the term of the fourth session of the Board.For details,please refer to the relevant announcements of the Company dated June 26,2023 and June 30,2023 and the relevant circular dat
255、ed May 24,2023.On March 22,2024,Mr.Chen Wei,Mr.Hu Hanjun and Mr.Chen Hongliang were appointed as non-executive Directors,Mr.Song Wei was appointed as an executive Director,Mr.Liu Guanqiao,Mr.Ye Qian,Mr.Paul Gao,Mr.Kevin Walter Binder,Mr.Gu Tiemin and Mr.Sun Li were appointed as non-executive Directo
256、rs,and Ms.Yin Yuanping,Mr.Xu Xiangyang,Mr.Tang Jun,Mr.Edmund Sit and Mr.Ji Xuehong were appointed as independent non-executive Directors,for a term of office commencing on March 22,2024 until the expiration of the term of the fifth session of the Board.On the same day,Mr.Chenwei was elected as the C
257、hairman of the Company by the fifth session of the Board of Directors,and the chairmen and members of the audit committee of the Board(the“Audit Committee”),the Remuneration Committee,the Nomination Committee and the Strategy Committee were elected.The term of office of the above personnel commenced
258、 on March 22,2024 until the expiration of the term of the fifth session of the Board of Directors.With the establishment of the fifth session of the Board of Directors,Mr.Hubertus Troska,Mr.Harald Emil Wilhelm and Mr.Ge Songlin,who were the Directors of the fourth session of the Board of Directors o
259、f the Company,ceased to be the Directors.For details,please refer to the relevant announcement of the Company dated March 22,2024.Save as disclosed above,there was no change in the composition of the Board from January 1,2023 and up to the Latest Practicable Date.On March 15,2023,Mr.Sun Zhihua cease
260、d to be a Supervisor due to work adjustment.BAIC Motor Corporation Limited ANNUAL REPORT 202332Section VI Report of the Board of DirectorsOn June 26,2023,the Company held the 2022 annual general meeting.Ms.Jiao Feng was appointed as a non-employee representative Supervisor of the Company for a term
261、commencing from June 26,2023 until the expiration of the term of the fourth session of the board of supervisors of the Company(the“Board of Supervisors”).For details,please refer to the relevant announcements of the Company dated March 17,2023 and June 26,2023 and the relevant circular dated May 24,
262、2023.On March 19,2024,Mr.Zhang Ran and Ms.Jiang Yumei were elected as employee representative Supervisors of the fifth session of the Board of Supervisors at the employee representatives meeting of the Company.On March 22,2024,Ms.Jiao Feng,Ms.Zhu Yan and Mr.Deng Yishuai were appointed as non-employe
263、e representative Supervisors of the fifth session of the Board of Supervisors at the first extraordinary general meeting of the Company in 2024.The above five Supervisors form the fifth session of the Board of Supervisors for a term of office commencing on his/her appointment date until the expirati
264、on of the term of the fifth session of the Board of Supervisors.On March 22,2024,Mr.Zhang Ran was elected as the chairman of the fifth session of the Board of Supervisors at the first meeting of the fifth session of the Board of Supervisors,with a term of office commencing from March 22,2024 until t
265、he expiration of the term of the fifth session of the Board of Supervisors.With the establishment of the fifth session of the Board of Supervisors,Mr.Zhang Yanjun,who is the Supervisor of the fourth session of the Board of Supervisors of the Company,ceased to be the employee representative Superviso
266、r with effect from March 19,2024;Mr.Zhou Xuehui and Ms.Qiao Yufei ceased to be the Supervisors with effect from March 22,2024.For details,please refer to the relevant announcement of the Company dated March 22,2024.Save as disclosed above,there was no change in the composition of the Board of Superv
267、isors from January 1,2023 and up to the Latest Practicable Date.Senior Management and Company SecretaryOn June 28,2023,Mr.Huang Wenbing ceased to be the president of the Company(the“President”),with effect from the date of the election of a new President by the Board of Directors.On June 30,2023,the
268、 Board resolved to appoint Mr.Song Wei as the President for a term commencing from June 30,2023 until the expiration of the term of the fourth session of the Board.For details,please refer to the relevant announcement of the Company dated June 30,2023.On March 22,2024,Mr.Song Wei was elected as the
269、President at the first meeting of the fifth session of the Board of Directors,with a term of office commencing from March 22,2024 until the expiration of the term of the fifth session of the Board of Directors.For details,please refer to the relevant announcement of the Company dated March 22,2024.O
270、n the same day,a resolution to amend the Articles of Association was considered and approved at the 2024 first extraordinary general meeting,adding a provision stating that the general counsel shall be a member of the Companys senior management.Mr.Zhang Zuyuan was appointed as the general counsel of
271、 the Company at the first meeting of the fifth session of the Board,with a term of office commencing on March 22,2024 until the expiration of the term of the fifth session of the Board of Directors.Save as disclosed above,there was no change in senior management and company secretary of the Company
272、from January 1,2023 and up to the Latest Practicable Date.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 33Section VI Report of the Board of DirectorsSERVICE CONTRACTS OF DIRECTORS AND SUPERVISORSEach Director of the Board of Directors and each Supervisor of the Board of Supervisors has entered i
273、nto a service contract with the Company for a term of three years or ending on the expiry of the term of office for the current session of the Board of Directors or the Board of Supervisors.The service contracts set out the main terms,key conditions and relevant rights,obligations and responsibiliti
274、es of the appointed Directors and Supervisors,with particular emphasis on the duties of the independent non-executive Directors and the executive Directors,and they can be terminated in accordance with the relevant terms in the service contracts.In 2023,none of the Directors or the Supervisors enter
275、ed into a service contract with the Company that cannot be terminated by the Company within a year without compensation(other than statutory compensation).REMUNERATION OF DIRECTORS AND SUPERVISORSDetails of remuneration of Directors and Supervisors in 2023 are set out in Note 40 to the consolidated
276、financial statements.REMUNERATION FOR FIVE INDIVIDUALS WITH THE HIGHEST REMUNERATIONDetails of remuneration for five individuals(excluding Directors and Supervisors)with the highest remuneration in the Company in 2023 are set forth in Note 30 to the consolidated financial statements.MANAGEMENT CONTR
277、ACTSIn 2023,no contract regarding the management and administration of overall business and any substantial part of the business has been entered into by the Company.CONTRACTS OF SIGNIFICANCESave as disclosed in the section headed“CONNECTED TRANSACTIONS”on pages 37 to 47 in this report,none of the C
278、ompany or any of its subsidiaries entered into any contracts of significance with the Controlling Shareholder or any of its subsidiaries other than the Group,nor was there any contract of significance between the Group and the Controlling Shareholder or any of its subsidiaries other than the Group i
279、n relation to provision of services in 2023.MATERIAL INTERESTS OF DIRECTORS AND SUPERVISORS IN CONTRACTS,TRANSACTIONS OR ARRANGEMENTSIn 2023,save as disclosed in this report,none of the Directors or Supervisors or their connected entities directly or indirectly has material interest in any contracts
280、,transactions or arrangements,which are significant to the businesses of the Group and entered into by the Company or any of its subsidiaries.INTERESTS OF DIRECTORS ON COMPETING BUSINESSESIn 2023,save as disclosed in this report,none of the Directors or their associates has any competing interests i
281、n the businesses which compete or are likely to compete with businesses of the Company,either directly or indirectly.BAIC Motor Corporation Limited ANNUAL REPORT 202334Section VI Report of the Board of DirectorsDIRECTORS SERVING IN COMPETING BUSINESSESThe chart below summarizes the information of th
282、e Directors of the Company serving in BAIC Group and its connected companies as of the Date of Issue of the Report:NameMajor positions in the GroupMain Positions in Beijing Automotive Group Co.,Ltd.and Its Connected Companies Mr.Chen Wei Chairman of the Board and non-executive Director of the Compan
283、y Deputy general manager of Beijing Automotive Group Co.,Ltd.Executive director and general manager of BAIC Group Off-road Vehicle Co.,Ltd.Mr.Hu Hanjun Non-executive Director of the Company Deputy general manager and secretary to the board of directors of Beijing Automotive Group Co.,Ltd.Mr.Chen Hon
284、gliang Non-executive Director of the Company Assistant to general manager of Beijing Automotive Group Co.,Ltd.Save as disclosed above,as of the Date of Issue of the Report,none of the Directors or their associates had any interest in competing businesses or businesses that might be competing with th
285、e Groups business,nor did they have any other conflicts of interest with the Group.INTERESTS AND SHORT POSITIONS OF DIRECTORS,SUPERVISORS AND SENIOR MANAGEMENT IN SHARES,UNDERLYING SHARES AND DEBENTURESAs at the end of the Reporting Period,none of the Directors,Supervisors or chief executives of the
286、 Company had any interests or short positions in the shares,underlying shares and debentures of the Company or its associated corporations which were required(a)to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO(including interests and short posi
287、tions which they were taken or deemed to have under such provisions of the SFO);or(b)pursuant to section 352 of the SFO,to be entered in the register of the Company as referred to therein;or(c)pursuant to the Model Code,to be notified to the Company and the Stock Exchange.DIRECTORS AND SUPERVISORS R
288、IGHTS TO ACQUIRE SHARES OR DEBENTURESAs at the end of 2023,none of the Directors or Supervisors or any of their respective associates was granted by the Company or its subsidiaries any rights to,or exercised any rights to acquire shares or debentures of the Company or any other body corporate.ANNUAL
289、 REPORT 2023 BAIC Motor Corporation Limited 35Section VI Report of the Board of DirectorsINTERESTS AND SHORT POSITIONS OF SUBSTANTIAL SHAREHOLDERS IN SHARES AND UNDERLYING SHARESAs at the end of 2023,to the best knowledge of the Directors,the following entities/persons(except for the Directors,Super
290、visors and senior management)had interests or short positions in the Shares or underlying Shares of the Company which were required to be disclosed to the Company pursuant to Divisions 2 and 3 of Part XV of the SFO,or recorded in the register required to be kept of the Company under section 336 of t
291、he SFO,or who were directly and/or indirectly deemed to have 5%or more interest of the nominal value of any class of share capital carrying rights to vote in all circumstances at the annual general meetings:Name of ShareholderClass of SharesNumber ofShares/UnderlyingShares Held Note 1Percentages ofR
292、elevant Class ofShares(%)Note 2Percentage ofthe Total ShareCapital(%)Beijing Automotive Group Co.,Ltd.Note 3Domestic Shares3,566,659,704(L)64.9144.50Shougang Group Co.,Ltd.Domestic Shares1,028,748,707(L)18.7212.83Mercedes-Benz Group AGH Shares765,818,182(L)30.389.55 Note 1:(L)Long position,(S)Short
293、position,(P)-Lending pool.Note 2:The percentage is calculated based on the number of Shares held by relevant persons/the number of relevant classes of Shares of the Company in issue as at the end of 2023.Note 3:As of the Date of Issue of the Report,BAIC Group has been transferred 150 million domesti
294、c shares of the Company held by Shenzhen Benyuan Jinghong Equity Investment Fund Enterprise(Limited Partnership),which in aggregate held 46.37%equity interest in the Company.ARRANGEMENTS FOR SHARE PRE-EMPTIVE RIGHT AND SHARE OPTIONIn 2023,no arrangement for share pre-emptive right and share option w
295、as made by the Company,and there is no specific provision under the PRC laws or the Articles of Association regarding share pre-emptive right.DEBENTURES ISSUEDIn 2023,the Group did not issue any debentures.As at the end of 2023,the total outstanding borrowings was RMB13,274.9 million,including short
296、-term borrowings of RMB6,735.7 million in aggregate and long-term borrowings of RMB6,539.2 million in aggregate.EQUITY-LINKED AGREEMENTSIn 2023,no equity-linked agreements that will or may result in the Company issuing Shares or that require the Company to enter into any agreements that will or may
297、result in the Company issuing Shares were entered into by the Company or subsisted.BAIC Motor Corporation Limited ANNUAL REPORT 202336Section VI Report of the Board of DirectorsPERMITTED INDEMNITY PROVISIONIn 2023,no permitted indemnity provision(whether made by the Company or otherwise)was made whi
298、ch was or is in force for the benefit of the Directors of the Company or any directors of the associated companies of the Company(if made by the Company).The Company has liability insurance to protect Directors,Supervisors and senior management against certain relevant lawsuits.RETIREMENT AND EMPLOY
299、EE BENEFIT SCHEMESFor details of the retirement and employee benefit schemes of the Group,please refer to the section headed“Employees”on pages 47 to 48 of this report.COMPLIANCE WITH THE CORPORATE GOVERNANCE CODEFor details,please refer to the chapter headed“Corporate Governance Report”on pages 51
300、to 66 of this report.AUDIT COMMITTEEThe Audit Committee has reviewed the Companys and the Groups 2023 annual results,and the audited consolidated financial statements for 2023 prepared in accordance with the IFRS Accounting Standards.AUDITORSPricewaterhouseCoopers(“PwC”)and PricewaterhouseCoopers Zh
301、ong Tian LLP(Special General Partnership)(“PwC Zhong Tian”)were appointed as the Companys auditors in relation to the financial statements prepared under the IFRS Accounting Standards and China Accounting Standards,respectively,for the year of 2023.FIVE-YEAR FINANCIAL SUMMARYSummary of the Groups op
302、eration performance,assets and liabilities for the last five financial years is set out in the chapter headed“Summary of Operations”on page 6 in this report.This summary does not form part of the audited consolidated financial statements.COMPLIANCE OF BAIC GROUP WITH THE NON-COMPETITION UNDERTAKINGT
303、he Company has received a confirmation letter from BAIC Group,which confirms that in 2023,BAIC Group has complied with every undertaking in the Non-competition Undertaking given to the Company.PUBLIC FLOATAccording to the information publicly available to the Company,or to the knowledge of the Direc
304、tors,as at the Date of Issue of the Report,the public held no less than 21.90%of Shares issued by the Company,which complies with a waiver regarding public float granted to the Company when it got listed.For details,please refer to the Prospectus,the announcement of the Company on partial exercise o
305、f over-allotment option dated January 12,2015,and the announcement of the Company on completion of the placing of H Shares dated May 3,2018.MATERIAL LITIGATIONAs of the end of 2023,the Company was not involved in any material litigation or arbitration.To the best knowledge of the Directors,there is
306、also no pending material litigation or claim against the Company or material litigation or claim against the Company which may have material adverse effect to the Company.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 37Section VI Report of the Board of DirectorsCONNECTED TRANSACTIONSNon-fully-ex
307、empted continuing connected transactions1.Trademark Licensing Framework Agreement between the Company and BAIC GroupThe Company and BAIC Group entered into a trademark licensing framework agreement on March 24,2023,which took effect from the date of approval by the Shareholders at the 2022 annual ge
308、neral meeting to December 31,2025,and was subject to renewal by mutual consent.Pursuant to the agreement,the Group is licensed by BAIC Group to use certain trademarks in the products manufactured and services supplied by the Group and in the documents of the Group.The actual trademark licensing fees
309、 and payment method shall be determined in accordance with the principles,terms and conditions of the agreement and set out in a specific agreement to be entered into between the parties.The annual caps for the trademark licensing fees paid/to be paid by the Group to BAIC Group under the trademark l
310、icensing framework agreement for 2023,2024 and 2025 are as follows:Annual cap for the year ended/ending December 31,(RMB in million)Item202320242025 Trademark licensing fees paid/to be paid by the Group to BAIC Group985.0992.0996.0 The above continuing connected transactions and annual caps were con
311、sidered and approved by the Board of Directors on March 24,2023 and approved by the Shareholders on June 26,2023 at the 2022 annual general meeting.For further details of the trademark licensing framework agreement,please refer to the announcement of the Company dated March 24,2023 and the circular
312、dated May 24,2023.In 2023,the trademark licensing fees paid by the Group to BAIC Group under the above agreement were RMB746.6 million.2.Property and Facility Leasing Framework Agreement between the Company and BAIC GroupThe Company entered into a property and facility leasing framework agreement(th
313、e“Property and Facility Leasing Framework Agreement”)with BAIC Group on December 2,2014,with the term from the Listing date of the Company to December 31,2016,subject to renewal through mutual consents by both parties.Both parties renewed the Property and Facility Leasing Framework Agreement on Octo
314、ber 20,2016,March 27,2019 and April 27,2022 with the term from January 1,2023 to December 31,2025,subject to renewal through mutual consents by both parties.BAIC Motor Corporation Limited ANNUAL REPORT 202338Section VI Report of the Board of DirectorsPursuant to the agreement,the Group will lease pr
315、operties and facilities from BAIC Group and/or its associates for manufacturing specific passenger vehicles.The rent payable under the agreement was agreed based on arms length negotiation between the parties to the agreement with reference to the local market price,in compliance with relevant rules
316、 and regulations of the PRC;Specific agreements shall be entered into stipulating the specific terms and conditions(including property rentals,payment methods and other usage fees)in respect of relevant leased properties and facilities.The annual caps for the rentals payable by the Group to BAIC Gro
317、up and/or its associates for the property and facility leasing and the rentals to be received from BAIC Group and/or its associates for the property and facility leasing under the Property and Facility Leasing Framework Agreement are set out below:Annual cap for the year ended/ending December 31,(RM
318、B in million)Item202320242025 Rentals paid/to be paid by the Group to BAIC Group and/or its associates for property and facility leasing425.8425.8425.8Rentals received/to be received by the Group from BAIC Group and/or its associates for property and facility leasing255.9255.9255.9 The above continu
319、ing connected transactions and the annual caps were considered and approved by the Board of Directors on April 27,2022.For other details on the Property and Facility Leasing Framework Agreement,please refer to the announcement of the Company dated April 27,2022.In 2023,the rentals for property and f
320、acility leasing paid by the Group to BAIC Group and/or its associates were RMB123.2 million,and the rentals received by the Group from BAIC Group and/or its associates for property and facility leasing were RMB23.1 million.3.Financial Services Framework Agreement between the Company and BAIC Finance
321、The Company entered into a financial services framework agreement(the“Financial Services Framework Agreement”)with BAIC Finance on December 2,2014,for an initial term from the Listing date of the Company to December 31,2016,subject to renewal through mutual consents by both parties.The Company renew
322、ed the Financial Services Framework Agreement with BAIC Finance on October 20,2016,March 27,2019 and April 27,2022 with the term from January 1,2023 to December 31,2025,subject to renewal through mutual consents by both parties.ANNUAL REPORT 2023 BAIC Motor Corporation Limited 39Section VI Report of
323、 the Board of DirectorsPursuant to the agreement,BAIC Finance will provide financial services to the Company,mainly including(i)deposits;(ii)loans and entrusted loans;(iii)other financial services inclusive of notes discount and acceptance,finance leasing,settlement and entrusted loan agency;and(iv)
324、any other services subject to relevant approvals from National Financial Regulatory Administration(“NFRA”).The Financial Services Framework Agreement provides for the following pricing principles:(a)Deposit services.Interest rates for the deposits placed by the Group with BAIC Finance will not be lo
325、wer than:(i)the lower limit of interest rate published by the Peoples Bank Of China(“PBOC”)for deposits of a similar type for the same period;(ii)the interest rate for deposits of the same type for the same period placed by subsidiaries of BAIC Group(other than the Group);or(iii)the interest rate fo
326、r deposits of the same type for the same period offered by independent commercial banks to the Group.(b)Loans services.Interest rates for the loans to be advanced by BAIC Finance to the Group will not be higher than:(i)the caps(if any)of the loan interest rate published by the PBOC for loans of a si
327、milar type for the same period;(ii)the interest rate for loans of the same type for the same period offered by BAIC Finance to other subsidiaries of BAIC Group(other than the Group);or(iii)the interest rate for loans of the same type for the same period offered by independent commercial banks to the
328、 Group.(c)Other financial services.The interest rates or services fees will be(i)subject to the prevailing benchmark fee(if applicable)for similar types of financial services published by the PBOC or NFRA;(ii)comparable to or not exceeding the interest rates or fees charged by independent commercial
329、 banks or financial institutions to the Group for financial services of the same type;and(iii)comparable to,or no less favourable to the Group than,fees charged by BAIC Finance to the subsidiaries of BAIC Group other than the Group for financial services of the same type.As BAIC Group,the Controllin
330、g Shareholder and a connected person of the Company,holds 56.00%equity interest in BAIC Finance,an associate of BAIC Group,BAIC Finance is also a connected person of the Company.The transactions under the Financial Services Framework Agreement between the Company and BAIC Finance constitute connecte
331、d transactions of the Company,pursuant to Chapter 14A of the Listing Rules.As the loan services provided by BAIC Finance to the Group are on normal commercial terms and on terms that are no less favourable than those offered by independent third parties to the Group for comparable services in China,
332、and no security over the assets of the Group was granted in respect of the loans,the loan service transactions are exempted from the reporting,announcement and independent Shareholders approval requirements under the Rule 14A.90 of the Listing Rules.BAIC Motor Corporation Limited ANNUAL REPORT 20234
333、0Section VI Report of the Board of DirectorsThe annual caps on the maximum daily balance of deposits,the interest income from deposits placed by the Group with BAIC Finance and charges for other financial services under the Financial Services Framework Agreement for 2023,2024 and 2025 are as follows:Annual cap for the year ended/ending December 31,(RMB in million)Item202320242025 Maximum daily bal
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