Wei Shen

Wei Shen of UBS inquired about the reasons for the significant decrease in other operating income in 2024 and the outlook for this trend in 2026. Additionally, Wei Shen asked for detailed profit growth figures for the MTU joint venture in 2025, beyond the combined results.

Answer

Choon Sen Loo (CFO) and Weng Ming Hoh (President) explained that the reduction in other operating income was primarily due to lower government grants in 2025, which were half of the 2024 levels, and this trend is expected to continue into 2026. Kelvin Lai (General Manager of Operations and Chairman of MTU Yuchai Power Company Limited) reported that the MTU joint venture generated RMB 211 million in net profits in 2025, a 22% increase from 2024, with sales volume and revenue up over 30%. The profit growth lagged revenue due to a change in product mix, specifically fewer 20-cylinder engine sales.

Wei Shen asked about the reasons for the significant decrease in other operating income in 2024 and the outlook for 2026, and later inquired about the specific profit growth and figures for the MTU joint venture in 2025.

Answer

President Weng Ming Hoh explained the decrease in other operating income was primarily due to lower government grants in 2025 compared to 2024, a trend expected to continue in 2026 due to tightened Chinese government incentive policies. Kelvin Lai, General Manager of Operations and Chairman of MTU Yuchai Power Company Limited, reported that the MTU joint venture generated RMB 211 million in net profit in 2025, a 22% increase from 2024, driven by over 30% growth in sales volume and revenue, though profit growth was tempered by a shift in product mix (fewer 20-cylinder engines).

Wei Shen of UBS Group inquired about potential increases in the Average Selling Price (ASP) for data center engines in the second half of the year and sought more detail on the company's strategy to expand from engine manufacturing into generator set production.

Answer

Weng Ming Hoh, President & Director, stated that there was no significant ASP increase for data center engines in H1 2025 and reiterated the no-guidance policy for H2. He clarified that Yuchai's core business remains selling engines to OEMs and it only produces full generator sets on specific customer request to avoid competing with its primary OEM partners.

Wei Shen of UBS Group inquired about potential increases in the Average Selling Price (ASP) for data center engines in the second half of the year and asked for details on how an expansion into generator manufacturing would impact revenue and profit.

Answer

President & Director Weng Ming Hoh stated that ASPs are largely set by their OEM customers and did not provide H2 guidance. He clarified that Yuchai's core business remains engine sales, and they only build full generator sets upon specific customer request to avoid competing with their OEM partners.

Wei Shen of UBS Group inquired about potential increases in the Average Selling Price (ASP) for data center engines in the second half of the year and sought more details on the company's strategy to expand into generator manufacturing.

Answer

President & Director Weng Ming Hoh stated that ASPs are largely determined by their OEM customers and reiterated the no-guidance policy for future pricing. He also clarified that the company's core business remains engine sales, and it only produces full gensets upon specific customer request to avoid competing with its OEM partners.

Wei Shen from UBS asked about the company's gross margin outlook and its financing plans for 2025.

Answer

CFO Conor Yang stated that EHang is targeting a gross margin of around 60%. He explained this would be achieved by diversifying product lines, which would be partially offset by a shift towards a distribution model. Regarding financing, Mr. Yang noted the company's strong cash position and positive operating cash flow but confirmed plans to seek additional financing in 2025 to support growth, product development, and facility expansion.