Tuhu Car (09690): Technological empowerment drives high-quality performance growth, "The First Brand After Auto" evolves again.

The performance announcement for 2024 was released by Tu Hu Yangche (09690), the "first brand in the automotive aftermarket" in China, on March 20th. According to the financial report, in 2024, Tu Hu Yangche achieved a revenue of 14.759 billion yuan, an increase of 8.5% compared to the previous year. Looking at the business segments, revenue from automotive products and services reached 13.802 billion yuan, an increase of 9.1%, with the revenue from tire and chassis components and automotive repair departments increasing by 10.2% to 11.6 billion yuan. In terms of profits, the company's gross profit reached 3.746 billion yuan, with a gross profit margin of 25.4%, an increase of 0.7 percentage points compared to the previous year. Adjusted net profit (non-International Financial Reporting Standards) reached 624 million yuan, a significant increase of 29.7% compared to 2023. This indicates that Tu Hu Yangche has achieved significant results in cost control, operational efficiency, and product profitability, strengthening its profit-making ability. It is worth noting that Tu Hu Yangche has achieved continuous growth in operating performance since 2023. At the same time, the company has firmly held the leading position in the independent automotive service market in China, with the gap between it and the second-ranked competitor widening further. By the end of 2024, the number of Tu Hu stores reached a milestone of 6,000, with a net increase of 965 stores to 6,874, covering a wide range across the country, with a coverage rate of 66% in counties with over 20,000 passenger cars. Compared to American automotive aftermarket chain brands, Tu Hu Yangche has significant advantages in scale and growth rate. The number of O'Reilly stores in the US is approximately 6,378, and Advance Auto Parts has around 4,788 stores, both lower than Tu Hu Yangche's store size. In terms of expansion speed, Tu Hu Yangche adds nearly a thousand stores each year, far exceeding the top competitors in the US. It is also noteworthy that the user base of Tu Hu Yangche has grown rapidly, with transaction users reaching 24.1 million, an increase of 24.8%, and registered users reaching 139 million, an increase of 20.4%. Platform order satisfaction rate exceeds 95%, user repurchase rate reaches 62.3%, consolidating the influence of the "first brand in the automotive aftermarket". Strengthening multiple core competencies, consolidating market leadership In the competitive automotive aftermarket, Tu Hu Yangche's achievements are attributed to its commitment to providing quality products and services, thus winning user recognition and accumulating a good market reputation. The commitment to users that "Tu Hu Yangche, authentic products can be traced, high quality is guaranteed" is not just a slogan, but a key cornerstone of the company's operations to build a competitive "moat". It is understood that on the product supply side, Tu Hu Yangche has established direct supply or authorized cooperation with many well-known brands, covering multiple categories such as tires, maintenance, batteries, and beauty to ensure product quality from the source. In the tire field, Tu Hu Yangche cooperates closely with brands such as Michelin and Bridgestone from Germany; maintenance products are endorsed by big brands such as Shell and Mobil. To achieve a fully traceable product chain, Tu Hu Yangche, in partnership with Tencent, Huawei Cloud, and other industry partners, uses blockchain technology to create a trusted source tracing system. In 2024, in cooperation with Huawei Cloud, the entire chain of information for automotive parts was written into the blockchain, launching a new platform for tracing genuine products, allowing consumers to clearly understand product origins and quality. In terms of quality assurance, Tu Hu Yangche has introduced "Gold Medal Quality Assurance" and lifetime tire quality assurance services. The "Gold Medal Quality Assurance" service provides consumers with a 3-year guarantee, with a maximum subsidy of 80% for damage resulting in bulging or tire burst caused by collisions; the lifetime tire quality assurance allows consumers to have peace of mind. In addition, Tu Hu Yangche launched the "Genuine Oil Guard Alliance", uniting six international lubricant brands to protect consumer rights through measures such as direct supply from manufacturers, "one fake ten compensation", and scrapping of old bottles. In addition to taking genuine products as the foundation, the company has also achieved remarkable results in product innovation and service innovation. The company has collaborated with well-known brands to launch exclusive products, as well as developing its own self-control brands. In the tire business, Tu Hu Yangche, in collaboration with Michelin, has exclusively launched high-end products; the cooperation with Michelin continues to deepen, with sales on the Tu Hu platform growing by more than 60%. In terms of self-owned brands, the company has introduced the Flying Strong tires as well as the high-end series of Dongfeng Victory and Leap at the Peak to meet the needs of different users. Tu Hu Yangche has also launched a variety of high-end self-controlled brand oils, with sales of hybrid-specific oils growing by over 270% in 2024. In terms of service innovation, Tu Hu Yangche is actively positioning itself around the development trend of new energy vehicles. By improving the maintenance technology and service capabilities of new energy vehicle batteries, motors, and electronic control systems, it collaborates with battery manufacturers to provide maintenance during the warranty period and address the end-user demands. With over 800 technicians certified as low-voltage electricians, the company is exploring the establishment of Wuxi Online Offline Communication Information Technology Co., Ltd. for battery testing services. Additionally, the new energy vehicle charging business has been launched, integrating with leading domestic electric pile suppliers, connecting to 70,000 charging stations, covering 342 cities nationwide, and providing a one-stop service for new energy vehicle users. In terms of optimizing and upgrading supply chain management, Tu Hu Yangche has increased the number of regional warehouses and front warehouses, expanded warehouse areas, optimized inventory models, and has 30 regional warehouses and 606 front warehouses, with a 31% increase in regional warehouse areas and approximately 100 net added front warehouses. Through 243 self-delivery routes and coordination with external carriers, the fulfillment cost rate has been reduced to 4.5%, and the same-day delivery rate has increased to 79%. The strong supply chain and logistics system ensure rapid product turnover and user fulfillment experience, providing solid support for the company's stable business development. Empowering with technology, expanding through diversified channels, ushering in a new era of intelligent development Outcome-oriented, Tu Hu Yangche has strengthened its core capabilities through multiple dimensions, achieving steady growth in performance, continuous expansion of market share, and increased user scale and loyalty. These achievements have also laid a solid foundation for further expanding channel scale and putting the company in a more advantageous position in market competition. In the future, Tu Hu Yangche is expected to leverage its existing advantages to achieve greater breakthroughs in channel expansion, further enhancing brand influence and market.Coverage rate of the venue.It has been understood that 2024 is the fourth year of its sinking strategy. As of now, the proportion of new sinking market stores has exceeded 60% of the total net increase in stores for four consecutive years. The "Ten Thousand Towns, Ten Thousand Stores" plan launched in August 2024 supports partners to enter underdeveloped towns in central and western regions by reducing franchise management fees. After the implementation of this plan, the number of TuHuYungChe stores in the northwest region increased by over 30% year-on-year in 2024, and the number of signed independent town stores in central and western regions increased by 48% year-on-year. At the same time, TuHuYungChe actively expands its online channels, increasing investment in popular platforms such as Douyin. Through a matrix of "content + live streaming + local life services," it attracts a large number of new users. In 2024, the number of new tire maintenance users on Douyin channel increased by over 100%, increasing brand awareness and market coverage. In the future, TuHuYungChe will deepen store and channel expansion. On the one hand, it will further increase investment in sinking markets, extending its store network to more towns and areas to increase market penetration in lower-tier cities, allowing more consumers to enjoy its quality services. On the other hand, it will continue to optimize the layout of stores in high-tier markets, providing differentiated products and services according to the consumption needs and characteristics of different regions, consolidating its competitive advantage in high-tier markets, and enhancing its influence among middle and high-end customer groups. Meanwhile, it will strengthen deep cooperation with various online platforms, explore emerging channel modes, such as leveraging the traffic advantages of social media platforms, conducting diversified marketing activities, attracting more young consumers, and expanding customer channels. In this process, technological innovation will become one of the core DRIVES driving the future development of TuHuYungChe. With the continuous development of AI technology, TuHuYungChe plans to further expand the application of the DeepSeek large model in various business processes. In terms of store operation management, AI will be used to achieve intelligent scheduling, intelligent inventory management, and improve store operation efficiency. In terms of customer service, AI intelligent customer service will provide users with faster and more accurate service answers to enhance user satisfaction. In terms of supply chain management, AI will be used to optimize logistics distribution routes, predict product demand, and reduce operational costs. By increasing investment in AI, it will drive the overall operational efficiency of the company and lead the automotive aftermarket into the era of intelligent services. In conclusion, TuHuYungChe achieved excellent results in 2024 with its multidimensional core competitive advantages. Faced with future market opportunities and challenges, its clear strategic planning and proactive innovation attitude are expected to continue to help it deeply cultivate the automotive aftermarket, lead the industry development trend, provide consumers with better and more convenient car service experiences, and create greater market value.