读取中,请稍候

00-00 00:00:00
--.--
0.00 (0.000%)
昨收盘:0.000今开盘:0.000最高价:0.000最低价:0.000
成交额:0成交量:0买入价:0.000卖出价:0.000
市盈率:0.000收益率:0.00052周最高:0.00052周最低:0.000
江铃B:2023年年度报告(英文版) 下载公告
公告日期:2024-03-30

Jiangling Motors Corporation, Ltd.

2023 Annual Report

2024-03

Chapter I Important Notes, Contents and Abbreviations

Important NoteThe Board of Directors and its members, the Supervisory Board and its members,and the senior executives are jointly and severally liable for the truthfulness,accuracy and completeness of the information disclosed in the report and confirmthat the information disclosed herein does not contain any false statement,misrepresentation or major omission.

Chairman Qiu Tiangao, CFO Joey Zhu and Chief of Finance Department, HuHanfeng, confirm that the Financial Statements in this Annual Report are truthfuland complete.

All Directors were present at the Board meeting to review this Annual Report.

Future plans, development strategies and other forward-looking statements inthis report do not constitute a substantial commitment of the Company toinvestors. Investors are advised to pay attention to investment risks.

The Company's possible risks and countermeasures are described in Section 3of this report, "Management Discussion and Analysis". Please investors to payattention to the relevant content.

The Annual Report is prepared in Chinese and English. In case of discrepancy,the Chinese version will prevail.

The year 2023 profit distribution proposal approved by the Board of Directors isas follows:

A cash dividend of RMB 6.84 (including tax) will be distributed for every 10shares held based on the total share capital of 863,214,000 shares, and there isno stock dividend. The Board decided not to convert capital reserve to sharecapital this time.

Contents

Chapter I Important Notes, Contents and Abbreviations ...... 2

Chapter II Brief Introduction and Operating Highlight ...... 5

Chapter III Management Discussion and Analysis ...... 10

Chapter IV Corporate Governance Structure ...... 29

Chapter V Environment and Social Responsibilities ...... 54

Chapter VI Major events ...... 58

Chapter VII Share Capital Changes & Shareholders ...... 63

Chapter VIII Preferred Shares ...... 68

Chapter IX Bond related Information ...... 69

Chapter X Financial Statements ...... 70

Catalog on Documents for Reference

1. Originals of 2023 financial statements signed by legal representative, Chief

Financial Officer and Chief of Finance Department.

2. Originals of the Independent Auditor’s Reports signed by independent

accountants and stamped by the accounting firm.

3. Originals of all the documents and public announcements disclosed innewspapers designated by CSRC in 2023.

4. The Annual Report in the China GAAP.

Abbreviations:

CSRC China Securities Regulatory CommissionJMCG Jiangling Motors Group Co., Ltd.Ford Ford Motor CompanyJIC Nanchang Jiangling Investment Co., Ltd.JMC or the Company Jiangling Motors Corporation, Ltd.JMCH JMC Heavy Duty Vehicle Co., Ltd.EVP Executive Vice PresidentCFO Chief Financial OfficerVP Vice President

Chapter II Brief Introduction and Operating Highlight

1. Company’s Information

Share’s nameJiangling Motors, Jiangling BShare’s Code000550, 200550
Place of listingShenzhen Stock Exchange
Company’s Chinese name江铃汽车股份有限公司
English nameJiangling Motors Corporation, Ltd.
AbbreviationJMC
Company legal representativeQiu Tiangao
Registered AddressNo. 2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province, P.R.C
Postal Code of Registered Address330200
Changes of Registered AddressDue to the relocation of JMC’s Qingyunpu site, the original registered address " No. 509, Northern Yingbin Avenue, Nanchang City, Jiangxi Province" was changed to "No.2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province" in October 2021.
Headquarters AddressNo. 2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province, P.R.C
Postal Code of Headquarters Address330200
Websitehttp://www.jmc.com.cn
E-mailrelations@jmc.com.cn

2. Contact Person and Method

Board SecretarySecurities Affairs Representative
NameXu LanfengQuan Shi
AddressNo. 2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province, P.R.CNo. 2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province, P.R.C
Tel86-791-8526617886-791-85266178
Fax86-791-8523283986-791-85232839
E-mailrelations@jmc.com.cnrelations@jmc.com.cn

3. Information Disclosure and Place for Achieving Annual Report

Stock Exchange Website for Publication of JMC’s Annual Reporthttp://www.szse.cn
Newspapers and Website forChina Securities, Securities Times, Hong Kong
Publication of JMC’s Annual ReportCommercial Daily, cninfo (http://www.cninfo.com.cn)
Place for Achieving Annual ReportSecurities Department, Jiangling Motors Corporation, Ltd.

4. Changes of Registration

Unified social credit code913600006124469438
Changes in the Main Business since the ListingNo change.
Changes of Controlling ShareholdersOn December 1, 1993, JMC A shares were listed on Shenzhen Stock Exchange, while JMCG, the founder-member, was the controlling shareholder of the Company. On September 29, 1995 and November 12, 1998, JMC issued additional 344 million B shares totally, while, after the additional B share issuance, JMCG and Ford were the controlling shareholders of the Company. On December 8, 2005, the 354.176 million JMC shares held by JMCG, the former controlling shareholder, were transferred to Jiangling Motor Holdings Co., Ltd. After the transference, Jiangling Motor Holdings Co., Ltd. and Ford were the controlling shareholders of the Company. In 2019, Jiangling Motor Holdings Co., Ltd., the former controlling shareholder, was divided and separated into Jangling Motor Holdings Co., Ltd. and Nanchang Jiangling Investment Co., Ltd., and transferred the 354.176 million JMC shares it held to Nanchang Jiangling Investment Co., Ltd. Presently, Nanchang Jiangling Investment Co., Ltd. and Ford are the controlling shareholders of the Company.

5. Other Information

Accounting Firm Appointed by JMC for Audit

NamePricewaterhouseCoopers Zhong Tian LLP (‘PwC Zhong Tian’)
Headquarters Address11/F, PricewaterhouseCoopers Center Link Square 2,202 Hu Bin Road, Huangpu District, Shanghai 200021, PRC
Names of Signed AccountantsYe Jun, Xiao Minjie

The recommendation agency engaged by the Company executing the persistentsupervision responsibilities in the reporting period

□Applicable ?Not Applicable

The financial consultant engaged by the Company performing the duties ofpersistent supervision and guidance in the reporting period

□Applicable ?Not Applicable

6. Main accounting data and financial ratios

Unit: RMB

20232022Change (%)2021
Revenue33,167,325,08130,100,283,84210.19%35,221,306,472
Profit Attributable to the Equity Holders of the Company1,475,597,266915,049,16861.26%574,165,944
Net Profit Attributable to Shareholders of Listed Company After Deducting Non-Recurring Profit or Loss995,236,837-229,667,660533.34%29,628,811
Net Cash Generated From Operating Activities4,567,539,866-1,518,573,952400.78%1,760,193,010
Basic Earnings Per Share (RMB)1.711.0661.26%0.67
Diluted Earnings Per Share (RMB)1.711.0661.26%0.67
Weighted Average Return on Equity Ratio15.06%10.28%4.78%5.87%
End of Year 2023End of Year 2022Change (%)End of Year 2021
Total Assets29,141,187,88627,468,321,8356.09%26,359,084,120
Shareholders’ Equity Attributable to the Equity Holders of the Company10,350,145,7389,243,817,33311.97%8,555,444,589

The lower of the Company’s net profit before and after deduction of non-recurringgains and losses in the most recent three fiscal years is negative, and the auditreport of the most recent year shows that the Company’s ability to continueoperations is uncertain

□Yes ?No

The lower of the net profit before and after non-recurring gains and losses isnegative

□Yes ?No

7. Accounting data difference between China GAAP and IFRSI. Differences in net profit and net assets in financial statements between inaccordance with international accounting standards and Chinese accountingstandards

□Applicable ?Not Applicable

II. Differences in net profit and net assets in financial statements between inaccordance with overseas accounting standards and Chinese accountingstandards

□Applicable ?Not Applicable

III. Reasons for the difference in accounting data between in accordance withoverseas accounting standards and Chinese accounting standards

□Applicable ?Not Applicable

8. Main accounting data quarterly

Unit: RMB

Q1Q2Q3Q4
Revenue7,525,930,4577,903,441,8528,078,772,8619,659,179,911
Profit Attributable to the Equity Holders of the Company182,746,938546,640,619280,065,212466,144,497
Net Profit Attributable to Shareholders of Listed Company After Deducting Non-Recurring Profit or Loss9,499,494408,229,717239,772,243337,735,383
Net Cash Generated From Operating Activities-721,527,5442,378,675,881758,439,6472,151,951,882

Whether the above mentioned financial indicators or the total number aresignificantly different from the financial indicators related to the disclosedquarterly and half-year reports of the Company

□Yes ?No

9. Non-recurring profit and loss items and amounts

?Applicable □Not Applicable

Unit: RMB

202320222021
Profit and loss of non-current assets disposal (including the charge-off part of the asset impairment provision)-7,453,268389,251,4755,107,814
Government subsidies included in the current profit and loss565,157,410943,326,556552,831,370
In addition to the effective hedging business related to the normal operating business of the Company, holding the gains and losses of fair value changes arising from trading financial assets and trading financial liabilities, as well as the investment income obtained from the disposal of trading financial assets, trading financial liabilities and available for sale6,052,7131,424,039-16,082,076

Details of other profit and loss items that meet the definition of non-recurringprofit and loss

□Applicable ?Not Applicable

There is no any other profit and loss items that meet the definition of non-recurring profit and loss in the Company.

The description of that the non-recurring profit and loss items listed in CorporateInformation Disclosure of Public Issuing Securities No.1 are defined as recurringprofit and loss items

□Applicable ?Not Applicable

The Company does not have a situation in which the non-recurring profit and lossitems listed in No.1 of Corporate Information Disclosure Announcement No.1 aredefined as recurring profit and loss.

financial assets
Capital occupation fee charged for non-financial enterprises included in the current profit and loss11,289,41513,827,41015,836,668
Return of the impairment provision for receivables with a separate impairment test-110,0682,250,000
Other non-operating income and expenses except the above6,379,6491,423,9482,027,076
Other profit and loss items that meet the definition of non-recurring profit and loss-11,097,866-18,765,020
Gains on disposal of long-term equity investments--52,133,307
Less: Income tax impact amount89,195,274204,283,36388,332,046
Influence of minority shareholders' equity772,350363,305
Total480,360,4291,144,716,828544,537,133

Chapter III Management Discussion and Analysis

1. The industry situation of the Company during the reporting periodIn 2023, automobile production and sales were completed at 30,161 thousandvehicles and 30,094 thousand vehicles respectively, with a year-on-year growthof 11.6% and 12% respectively, and the overall market sales for the yearappeared a gradually improved situation. At the beginning of this year, affectedby the exit of tax incentives for traditional fuel vehicles purchase and subsidypolicies for new energy vehicles, early coming of the Spring Festival holiday,early overdraft of part of the consumption and other factors, the recovery of autoconsumption was relatively lagging behind; from May to October, promoted bythe national and local policies, and the continuation of the local promotionalactivities for car purchasing and other measures, the market demand wasgradually released, the “Golden September and Silver October” effectreappeared; since November, the market continued to develop well, with thesuperimposed effect that the automobile enterprises endeavored to reach thepeak of sales volume at the end of the year, the automobile market performanceexceeded expectations, and the production and sales hit a record high. Amongthem, the passenger car market continued to grow well, which played animportant role in stabilizing the foundation of automobile consumption; for thecommercial vehicle market, owing to the stable and improving macroeconomics,and the recovery of consumer market demand, as well as the pull of variousfavourable policies, the production and sales returned to the level of 4 millionvehicles. Under the dual role of policy and market, new energy vehiclescontinued to grow rapidly in 2023, the annual production and sales into the scaleof 9.5 million vehicles, automobile exports continued to maintain a high level,creating monthly record highs, with an average monthly export volume of morethan 400 thousand vehicles since August, and an annual export volume of closeto 5 million vehicles, having effectively pulled the overall growth of the industry.

The production and sales of passenger cars amounted to 26,124 thousandvehicles and 26,063 thousand vehicles respectively, with a year-on-year growthof 9.6% and 10.6% respectively. Among the main varieties of passenger cars,compared with the same period of the previous year, the production and sales ofmulti-purpose vehicles (MPV) and sport utility vehicles (SUV) showed fastergrowth than the overall situation of the industry.

The production and sales of commercial vehicles amounted to 4,037 thousandvehicles and 4,031 thousand vehicles respectively, with a year-on-year growth of

26.8% and 22.1% respectively. Among the main varieties of commercial vehicles,compared with the same period of last year, the production and sales of busesand trucks showed double-digit growth. Bus production and sales werecompleted 498 thousand units and 492 thousand units, a year-on-year increaseof 22.5% and 20.6% respectively , of which the production and sales of lightbuses increased by more than 25% year-on-year; truck production and saleswere completed 3,539 thousand units, a year-on-year increase of 27.4% and

22.4% respectively, and the production and sales of light trucks increased bymore than 17% year-on-year.

In 2023, the production and sales of new energy vehicles reached 9,587thousand vehicles and 9,495 thousand vehicles respectively, an increase of 35.8%and 37.9% year on year, with a market share of 31.6%, 5.9% higher than that ofthe same period of the previous year. In the main varieties of new energyvehicles, compared with the same period of the previous year, the productionand sales of pure electric vehicles, plug-in hybrid electric vehicles and fuel cellvehicles continued to maintain a high growth.

China’s auto exports hit a new high in 2023, becoming an important force drivingthe growth of auto production and sales. Data showed that in 2023, automobileexports achieved 4,910 thousand vehicles, a year on year increase of 57.9%,and the contribution rate of exports to the growth of total automobile salesreached 55.7%. In terms of vehicle types, 4,140 thousand passenger cars wereexported, a year on year increase of 63.7%; 770 thousand commercial vehicleswere exported, a year on year increase of 32.2%. In terms of categories, 3,707thousand conventional fuel vehicles were exported, a year on year increase of

52.4%; 1,203 thousand new energy vehicles were exported, a year on yearincrease of 77.6%.

2. Company’s Core Business during the Reporting Period

During the reporting period, the Company's main business is the production andsale of commercial vehicles, SUVs and related components. The main productsinclude JMC light truck, Pickup, light bus, Ford-branded light bus, MPV, Pickupand other commercial vehicles and SUV products. JMC also produces engines,frame, axle, and components. The Company takes high quality development asthe main line, focuses on value, lean operation, and transforms from scaleexpansion development to lean value growth.

For 2023, JMC continued to increase its technological reserves and investmentin new products, intelligent connection network, new energy and lightweighting,and strengthened its digital operation capability to realize the transformation of“four online”, including “products online” “customers online” “processes online”and “employees online”. Through digital technology, the Company improvedoperational efficiency, optimize business processes and innovative businessmodels, and focused on customer-centered integration of the whole value chain.Meanwhile, JMC actively expanded its capacity operation and used car business,integrated intelligent technology into its service system, and gradually formed acustomer-centered commercial vehicle ecosystem to focus the entire life cycle ofautomobiles and provided customers with all-around solutions. JMC actively laidout the RV business and off-road pickup and modified car market to createunique products and lead the market trend; at the same time, the Companyaccelerated the demonstration operation of mass production of intelligent driving

and created industry-leading automatic driving solutions through closecooperation with its partners.

In 2023, JMC planned the productivity of 330 thousand units and the utilizationrate was 93%.

Vehicle manufacturing and operation?Applicable □Not Applicable

Production and Sales Volume Information

Production Volume (Unit)Sales Volume (Unit)
2023 FY2022 FYYOY change (%)2023 FY2022 FYYOY change (%)
By Products
Light Bus78,36879,805-1.80%80,22377,2373.87%
Truck63,13562,8250.49%62,81564,727-2.95%
Pickup58,72363,496-7.52%59,66062,872-5.11%
SUV107,19975,46842.05%107,31077,17239.05%
Total307,425281,5949.17%310,008282,0089.93%
By Region
China307,425281,5949.17%310,008282,0089.93%

Reasons for the year-on-year change of more than 30%?Applicable □Not ApplicableThe 39.05% year-on-year increase in SUV sales was mainly due to the increasein overseas sales.Component Kit System ConstructionJMC owns in-house R&D and manufacturing capability for key components, withsuch important components as engine, body parts, frame, and front axle, etc.developed and manufactured independently. For some other key components,JMC keeps strategic cooperation with industry leading suppliers, e.g. Bosch,Baosteel, Garrett, ZF, Magna and SDS. JMC has established strategiccooperation with such leading enterprises as CATL and Suzhou Inovance onnew energy development. For smart connectivity, JMC conducted diversifiedcooperation with such giants as Tencent, Hengrun, Baidu and Desay SV, etc. forecology development. With the vision of achieving customer success, JMCcooperates with suppliers to create a customer-centered vehicle experience andstrives to build a sustainable agile supply system. Through innovative thinkingand digitalization, JMC has established a complete supplier access, capabilityimprovement and supplier control mechanism from the perspectives oftechnology, quality, cost, delivery and service, thus effectively promoting thecompetitiveness of the supply system.

Production and operation of auto parts during the reporting period

□Applicable ?Not Applicable

The Company carries out auto finance business

□Applicable ?Not Applicable

The Company carries out new energy vehicle related business?Applicable □Not Applicable

Production and operation of new energy vehicles and parts

Product CategoryCapacity (Unit)Production Volume (Unit)Sales Volume (Unit)Revenue (RMB)
New Energy Bus Series35,0003,9193,419348,117,640
New Energy Passenger Vehicles and Pickup100,00026025053,468,952
New Energy Truck25,0001,1871,002154,664,338
Total160,000 Note: all new energy vehicles are collinear with corresponding fuel vehicles.5,3664,671556,250,930

New energy vehicle SubsidyIn 2023, JMC received a subsidy of RMB 17,930 thousand for new energyvehicles.

3. Core Competitiveness Analysis

The Company is a modern Sino-foreign joint venture that integrates automobileresearch and development, manufacturing and sales. It is a pioneer in theChinese auto industry that provides excellent products and solutions for theintelligent logistics field by relying on the market leadership and advancedtechnology of light commercial vehicles. It owns the titles of National High-techEnterprise, National Innovation Pilot Enterprise, National Enterprise TechnologyCenter, National Industrial Design Center, National Intellectual PropertyDemonstration Enterprise, and National Vehicle Export Base. It has been rankingamong the top 100 most valuable automobile brands in the world for manyconsecutive years. In 2023, JMC light bus ranked No.1 in the segment, Pickupranked No.2 in the segment, and light truck ranked No.6 in the segment. JMCexport sales have made rapid progress, with sales of 95,696 units, a year -on -year increase of 52%.

JMC always takes customers as the center, and provides customized integratedsolution based on customer use scenarios. During the epidemic period, TransitAmbulance was the first negative pressure ambulances delivered nationwide,and was awarded as "Vehicle No.1 in Epidemic Fighting". At the same time, theCompany continues to empower smart logistics, design integrated solutions forthe needs of large logistics customers to increase efficiency and reduce cost, and

provide C2B customized product services, end-to-end logistics solutions andoverall logistics capacity platform services.

The Company is a full scenario solution provider for light commercial vehicles.JMC light bus has an insight into customers’ needs and the light bus operationscenarios, and has launched high-quality, excellent and cost-effective light busproduct portfolios, achieving the full coverage of scenarios like freight, passengertransport and refit. The Company launched the new Light Truck Kaiyun +, as thefirst model under the Qingyun structure, through eight upgrades and ninecustomized product configurations to truly achieve a high degree of matchingwith users’ needs, opening the era of light truck customization. JMC launched"JMC Dadao", a new Pickup product, positioning "Chinese pickup expert of fullscenarios", covering the market of mid-to-high commercial and passenger dual-use and passenger off-road Pickups whose price are more than RMB 100,000.JMC has established the coexistence strategy of the three series of Pickupproducts and completed the full price and product matrix layout in the Pickupsegment.

The Company adheres to the dual-brand strategy of Self-owned and Ford, givingfull play to its own advantages while deeply integrating Ford's global system. Interms of technology research and development, with the help of Ford's globalplatform, the Company has gradually formed the core competitiveness ofindependent research and development, established an independent researchand development system, built an advanced global digital design platform, jointlydevelops, designs and launches specific new products with Ford. The Companyhas been an industry-leading technology center and industrial design center Interms of brand channels, the Company currently has more than 700 tier 1dealers, with a total of more than 2,000 dealers, and has established a modernmarketing system through the four-in-one franchise model of sales, accessories,service and information. In 2023, the all new channel brand “Ford Beyond” wasreleased, with the ultimate powerful off-road product portfolio, the personalizedcustomization modification and the abundant community activities as the pillars,the world's first Ford Beyond experience center was landed in October, and 71Ford Beyond experience centers were built throughout the year across thecountry, and meanwhile, in December, the Ford Ranger was launched, whichhas caused a huge sensation in the industry and achieved a very good marketresponse. In terms of manufacturing management, the Company has vehicleproduction bases such as Xiaolan Plant and Fushan Plant, covering stamping,welding, painting, diesel engines, gasoline engines and other advancedmanufacturing technology, to create a highly intelligent, highly flexible smartmanufacturing center. The Company is a demonstration enterprise in JiangxiProvince for integration of informatization and industrialization. In terms of newenergy, JMC has launched various new energy products such as E Lu Da, DaDao EV and E-Transit, released the new energy transportation brand "JMC Fun-to-Drive" which expanded the transportation and leasing business of theCompany, and committed to providing customers with systematic solution of "full-

scene product coverage, full-scene customer service, and full-scene ecologicalconstruction" from a holistic perspective to create the greatest value for usersfrom a practical point of view. At the same time, in terms of export business, theCompany has entered into a Framework Agreement on Vehicle ExportOpportunities with Ford. Relying on Ford’s mature global business layout andnetwork, both parties intend to procure the Company to become an exportproduct engineering and manufacturing center based in China and supportingFord’s global sales network.

4. Core Business Analysis

I. SummaryIn 2023, China's annual automobile production and sales, both hit a record high.Among them, the passenger car market continued to grow well, realizing sales of26,063 thousand cars; commercial vehicle market made steady progress;automobile exports hit a new high, with annual exports approaching 5 millionvehicles, having effectively pulled the overall rapid growth of the industry.

During the reporting period, in order to respond to a tougher competitiveenvironment, stricter homologation requirement and cost increase, JMC hasbeen dedicated in improving the product quality, promoting new productdevelopment, controlling operation cost and enhancing production efficiency. Atthe same time, JMC launched a series of marketing proposals to actively copewith market risks. In 2023, JMC achieved sales volume of 310,008 units,including 80,223 light buses, 62,815 trucks, 59,660 Pickups and 107,310 SUVs,with YOY increase of 9.93%. In 2023, the total production volume was 307,425units, including 78,368 light buses, 63,135 trucks, 58,723 Pickups and 107,199SUVs, with YOY increase of 9.17%.

In 2023, the operation revenue reached RMB 33,167 million, up 10.19% year onyear. The operation cost was RMB 28,066 million, up 8.73% year on year. Themarketing expense was RMB1,467 million, up 1.51% year on year. Theadministration expense was RMB 983 million, up 1.94% year over year. R&Dcost was RMB 1,286 million, down 13.29% year on year. The financial expensewas RMB -205 million, down by 25.01% year over year.

II. Revenue and Cost(a) Composition of Sales Revenue

Unit: RMB

2023 FY2022 FYYOY change (%)
AmountProportion (%)AmountProportion (%)
Revenue33,167,325,081100%30,100,283,842100%10.19%
By Industry
Automobile Industry33,167,325,081100%30,100,283,842100%10.19%
By Products
Vehicle30,379,757,73391.60%27,069,207,53889.93%12.23%
Components1,719,943,0335.18%2,412,993,5408.02%-28.72%
Automobile Maintenance Services574,249,5121.73%110,324,8410.37%420.51%
Material & Others493,374,8031.49%507,757,9231.68%-2.83%
By Region
China33,167,325,081100%30,100,283,842100%10.19%
Sales model
Distribution31,896,589,12196.17%28,995,566,64496.33%10.01%
Direct selling1,270,735,9603.83%1,104,717,1983.67%15.03%

(b) Reach to 10% of Revenue or Profit by Industry, Product, Region or SalesModel?Applicable □Not Applicable

Unit: RMB

TurnoverCostGross MarginYOY turnover change (%)YOY Cost Change (%)YOY gross margin change (points)
By Industry
Automobile Industry33,167,325,08128,065,528,22315.38%10.19%8.73%1.13%
By Products
Vehicle30,379,757,73325,855,510,80114.89%12.23%10.70%1.17%
By Region
China33,167,325,08128,065,528,22315.38%10.19%8.73%1.13%

If the Company’s core business scope is adjusted during the reporting period, theCompany’s core business data of last year need to be adjusted per the scope inthis year

□Applicable ?Not Applicable

(c) Whether the Company’s Goods Revenue Higher Than Service Revenue?Yes □No

IndustryItemUnit20232022Change (%)
AutomobileSales Volumeunit310,008282,0089.93%
Production Volumeunit307,425281,5949.17%
Inventory Volumeunit5,9379,113-34.85%

Explanation on YOY change of over 30%?Applicable □Not ApplicableThe 34.85% year-on-year decrease in inventory was mainly due to the increasein sales.

(d) Execution of the Company’s Signed Major Sales Contracts and MajorPurchase Contracts as of the Reporting Period

□Applicable ?Not Applicable

(e) Composition of Operating CostProduct categories

Unit: RMB

ProductItem2023 FY2022 FYYOY Change(%)
CostProportion (%)CostProportion (%)
VehicleCost25,855,510,80192.13%23,355,537,37490.48%10.70%
ComponentsCost1,230,323,6854.38%1,872,040,3607.25%-34.28%
Automobile Maintenance ServicesCost561,963,1882.00%109,409,7950.42%413.63%
Material & OthersCost417,730,5491.49%475,277,3391.85%-12.11%

(f) Whether the Consolidated Scope was Changed During the Reporting Period

□Yes ?No

(g) Major Change or Adjustment on Business, Products or Services During theReporting Period

□Applicable ?Not Applicable

(h) Main Customers and SuppliersMain Customers

Total sales value to top 5 customers(RMB)10,646,288,840
Accounted for the proportion of JMC’s total annual turnover32.10%
Included related party transaction accounted for the proportion of JMC’s total annual turnover27.76%

Top 5 Customers

No.Name of the CustomerSales Value (RMB)Percentage of JMC’s Total Turnover (%)
1Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd.9,207,385,26827.76%
2Zhejiang Jiangling Motors Sales Company431,981,5191.30%
3Beijing Jinglingshun Auto Sales Company369,333,0291.11%
4Yunnan Mingfu Automobile Sales Service Co., Ltd.340,094,5361.03%
5Suizhou Weihan Automobile Service Co., Ltd.297,494,4880.90%
Total10,646,288,84032.10%

Other introduction to main customers

?Applicable □Not ApplicableJiangxi Jiangling Motors Imp. & Exp. Co., Ltd. is related party of the Company.

Main Suppliers:

Total purchase value from top 5 suppliers(RMB)4,592,443,082
Accounted for the proportion of JMC’s total annual purchase amount18.72%
Included related party transaction accounted for the proportion of JMC’s total annual purchase amount15.48%

Top 5 Suppliers:

No.Name of the SupplierPurchase Value (RMB)Percentage of JMC’s Total Annual Purchase Amount (%)
1Magna PT Powertrain (Jiangxi) Co., Ltd.1,234,830,8165.03%
2Nanchang Jianglin Huaxiang Automobile Parts Co., Ltd.1,073,623,2284.38%
3Jiangxi Jiangling Qin Chuan Electrical Company Limited795,387,6553.24%
4Jiangxi Zhonglian Intelligent Logistics Co., Ltd.745,644,8043.04%
5Nanchang Baojiang Steel Processing Distribution Co., Ltd.742,956,5793.03%
Total4,592,443,08218.72%

Other introduction to main suppliers?Applicable □Not ApplicableMagna PT Powertrain (Jiangxi) Co., Ltd., Nanchang Jianglin HuaxiangAutomobile Parts Co., Ltd., Jiangxi Zhonglian Intelligent Logistics Co., Ltd. andNanchang Baojiang Steel Processing Distribution Co., Ltd., are related parties ofthe Company.

III. Expense

Unit: RMB

20232022YOY Change
Distribution Expenses1,466,692,4471,444,894,7111.51%
Administrative Expenses983,458,031964,786,3451.94%
Finance Income-net-204,908,754-163,907,346-25.01%
R & D Expenses1,286,201,6121,483,329,630-13.29%

IV. Research & Development

Name of main R&D projectProject purposeProject progressGoals to be achievedThe expected impact on the
Company's future development
All new electric platform SUV product projectTo enhance the competitiveness of passenger vehicle products for Ford Beyond, and meet the requirements of fleet dual credit policy for passenger vehicles in futureIt is under development and will begin production in the second half of 2025Increase the Company's operating revenue.
All new platform for electric light bus and light truckTo enhance the competitiveness of the Company’s electric city logistics vehicles and increase market shares.They are under development and will begin production in the beginning of 2025Increase the Company's operating revenue.
Electric products for exportTransformation of the company's export strategyThey are under development and will begin production one by one in the second half of 2025.Increase the Company's operating revenue.

Company R & D personnel

20232022Change(%)
R&D staff (person)2,4772,3505.40%
R&D staff as % of total employees21.32%19.05%2.27%
Educational structure of R&D personnel
Undergraduate1,7721,6517.30%
Master5685542.50%
Age composition of R&D personnel
Under the age of 3059053310.70%
30 ~ 40 years old1,4981,4811.10%

R&D Investment

20232022Change(%)
R&D investment (RMB)1,846,382,5212,018,500,532-8.53%
R&D investment as % of revenue5.57%6.71%-1.14%
Capitalization of R&D investment560,180,909535,170,9024.67%
Capitalization of R&D investment as % of R&D investment30.34%26.51%3.83%

Causes and impacts of major changes in the composition of R&D personnel

□Applicable ?Not Applicable

Reason for the substantial change of R&D investment as % of revenue

□Applicable ?Not Applicable

Reason and rationality of the substantial change in the capitalization rate of R &D investment

□Applicable ?Not Applicable

V. Cash Flow Analysis

Unit: RMB

Item20232022Change (%)
Cash received from operating activities38,462,687,96231,614,927,04921.66%
Cash outflows from operating activities33,895,148,09633,133,501,0012.30%
Net cash flows from operating activities4,567,539,866-1,518,573,952400.78%
Cash received from investing activities624,431,3061,407,222,333-55.63%
Cash outflows from investing activities1,796,589,5201,496,365,81220.06%
Net cash flows from investing activities-1,172,158,214-89,143,479-1,214.91%
Cash received from financing activities5,027,854,8334,731,667,6616.26%
Cash outflows from financing activities5,219,911,5244,149,807,89025.79%
Net cash flows from financing activities-192,056,691581,859,771-133.01%
Net increase in cash and cash equivalents3,203,324,961-1,025,857,660412.26%

Explanation on the major factors regarding major change of related data?Applicable □Not Applicable

Year on year increase of the Net cash flows generated from operating activitieswas due to the increase of sales volume, the increased payments received fromdealers.

Year on year decrease of the Net cash flows generated from investing activitieswas mainly due to the received money by the disposal of the land andaboveground buildings in the Qingyunpu site of the Company during the sameperiod in 2022.

Year on year decrease of the net cash flows generated from financing activitieswas mainly due to the lower new borrowings compared to the same period lastyear.

Year on year increase of the net increase in cash and cash equivalents wasmainly due to the increase in net cash generated from operating activities.

Explanation on significant difference between net cash generated from operatingactivities and net profit during the reporting period.

□Applicable ?Not Applicable

5. Non- core business analysis

□Applicable ?Not Applicable

6. Analysis of Assets and Liabilities

I. Major changes

Unit: RMB

Asset itemEnd of 2023Beginning of 2023YOY
Proportion change
AmountProportionAmountProportion(Points)
Cash and cash equivalents11,830,560,67540.60%8,604,977,72531.33%9.27%
Accounts receivables4,401,826,02215.11%4,245,541,75215.46%-0.35%
Inventories1,560,259,5115.35%2,129,040,8207.75%-2.40%
Long-term equity investments233,798,3480.80%248,482,8220.90%-0.10%
Fixed assets5,389,645,15218.49%5,446,384,36919.83%-1.34%
Construction in progress464,431,4121.59%718,612,1902.62%-1.03%
Right-of-use assets194,836,0280.67%233,622,8900.85%-0.18%
Short-term borrowings1,300,000,0004.46%1,100,000,0004.00%0.46%
Contract liabilities243,740,9920.84%152,065,0250.55%0.29%
Long-term borrowings1,391,4140%20,858,0570.08%-0.08%
Lease liabilities138,005,9430.47%193,090,3510.70%-0.23%

Foreign assets account for a relatively high proportion

□Applicable ?Not Applicable

II. The fair value of the assets and liabilities.

Unit: RMB

Itemfinancial assets1.Trading financial assets (excluding derivative financial assets)2.Receivables financingSubtotalFinancial liabilities
Beginning of the period0376,662,817376,662,8170
Loss/profit in fair value in the period604,8770604,8770
Cumulative changes in fair value recorded into equity00
Impairment in the period00
Purchase in the period500,000,0003,737,982,9544,237,982,9540
Sell in the300,000,0003,991,475,7094,291,475,709.0
period
Other changes00
End of the period200,604,877123,170,062323,774,9390

Other changeNone.

Whether there is a significant change in the measurement attributes of theCompany's main assets during the reporting period

□Applicable ?Not Applicable

III. Restriction on Assets Rights as of the End of the Reporting Period

Units: RMB

ItemsBook value at the end of the periodCause for restriction
Cash and cash equivalents20,854,424frozen funds for litigation.

7. Investment Analysis

I. Summary

□Applicable ?Not Applicable

II. Obtained Major Equity Investment during the Reporting Period

□Applicable ?Not Applicable

III. Ongoing Major Non-Equity Investment during the Reporting Period

□Applicable ?Not Applicable

IV. Financial Assets Investment(a) Stock Investment

□Applicable ?Not Applicable

There was no financial assets investment on the reporting period.

(b) Derivative Investment

□Applicable ?Not Applicable

There was no derivative investment on the reporting period.

V. Usage of Raised Fund

□Applicable ?Not Applicable

There was no usage of raised fund on the reporting period.

8. Sales of Major Assets and Equity

I. Sale of Major Assets

□Applicable ?Not Applicable

II. Sales of Major Equity?Applicable □Not Applicable

CounterpartyVolvo Lastvagnar Aktiebolag
Sold equity100% equity of JMC Heavy Duty Vehicle Co., Ltd., a wholly owned subsidiary of JMC
Date of saleThe transaction had been terminated
Transaction price (RMB thousand)781,400
Equity sale pricing principlePublic bidding process.
Whether it is a related party transactionNo.
Association with the counterpartyNo relationship.
Whether all the equity involved has been transferredNo.
Whether the plan is implemented as scheduled, if not, the reason and the measures taken by the companySince the items required for government approval on the transaction were not completed within the agreed time, the Company and Volvo Lastvagnar Aktiebolag agreed to terminate the transaction through negotiation.
Date of disclosureMay 13, 2023
IndexThe announcement (No. 2023-013) was published on the website: www.cninfo.com.cn

9. Analysis of major shareholding companies

?Applicable □Not ApplicableMain Subsidiaries and the Joint-Stock Companies whose operating resultsimpact on JMC’s net profit more than 10%

Unit: RMB’000

Name of companiesJiangling Motors Sales Corporation, LtdJMC Heavy Duty Vehicle Co., Ltd.Jiangling Ford Automobile Technology (Shanghai) Co., Ltd.
Type of companiesWhole-onwed subsidiaryWhole-owned subsidiaryHolding subsidiary
Main businessSales of vehicles and service parts.Production and sales of automobiles, engines and other automotive partsEngineering and technology research and experimental development, sales of vehicles, new energy vehicles, auto parts, etc.
Registered capital50,000.001,323,793.20200,000.00
Assets5,434,014.20396,986.20948,410.40
Net assets254,641.00366,242.80-745,455.30
Turnover22,161,719.40294.70643,047.90
Operating profit-116,386.60-334,545.30-1,118,600.80
Net profit-88,417.20-330,496.80-838,984.80

Acquisition and disposal of the subsidiaries

□Applicable ?Not Applicable

Description of the main holding and participating companiesThe impact of JMCH on the Company's performance is that the increase inprofits was partially offset by the assets impairment provisions accrued to reflectthe idle long-term assets of due to the termination of the reorganizationtransaction

The impact of Jiangling Ford Automobile Technology (Shanghai) Co., Ltd. on theCompany's performance is increase in net profit attributable to shareholders ofthe listed company caused by the changes in Minority Interests.

10. Structured Entities Controlled by JMC

□Applicable ?Not Applicable

11. Outlook

I. Industry DevelopmentIn 2024, China will continue to promote progress while maintaining stability, focuson spurring domestic demand, promote the steady recovery and expansion ofconsumption; expand effective investment, increase sci-tech innovation, andactively drive the high-quality economic development. In 2024, a number of newmeasures will also be reserved and optimized, which will have additive effectswith the stock policies to safeguard the stable economic operation. JMC isconfident in the economic upturn throughout the year. It is expected that theautomobile market will continue to appear a stable development trend in 2024,showing a growth of more than 3%.

Overall market: Annual sales are expected to be 31,000 thousand vehicles, anincrease of 3% year on year, the policy tone of stabilizing growth stimulatesdomestic demand growth, and the continuous drive of exports is conducive toautomobile consumption.

Commercial vehicle market: Annual sales are expected to be 4,200 thousandvehicles, an increase of 4% year on year, the country’s additional issuance ofone-trillion-yuan treasury bonds forms a good support for the commercial vehiclemarket in the first half of 2024, and new energy commercial vehicles bringstructural growth to the industry.

Passenger car market: Annual sales are expected to be 26,800 thousand cars,an increase of 3% year on year, and the “competition” and growing demands areexpected to drive sales growth.

New energy vehicle market: Annual sales are expected to be 11,500 thousandvehicles, an increase of 21% year on year, new energy vehicles maintain a highdegree of prosperity, and the penetration rate is expected to be further increased.

Export market: The annual export volume of automobiles is expected to be 5,500thousand vehicles, an increase of 12% year on year.

II. Company StrategyJMC adheres to the development vision of “becoming a leader in the lightcommercial vehicle industry and a high performance provider of Ford” and thevalues of “integrity, dedication, innovation and cooperation”. In terms ofcommercial vehicles, JMC aims at being a provider of comprehensive productand service solutions of urban and trunk logistics, and creating a “lifelong partner”new business concept to meet customer needs through offering customizedproducts and integrated services. In the passenger car field, JMC focuses onoutdoor and off-road needs and provide differentiated products to create theultimate customer experience. JMC will continue to focus on its core business,explore the potential of niche fields, always take customers’ demands asorientation, enhance the market awareness of the whole value chain, and striveto shape its products into the leaders of niche market. JMC will also aim at thenew development trend of the automobile industry, accelerate the transition tonew energy vehicles, increase investment, carry out technology research anddevelopment and product innovation, anchor in overseas markets, establish andimprove the international marketing service system, consolidate and expand theautomobile exports to the markets of key countries and regions, cultivateautomobile exports as a new growth point of enterprise development, andcomprehensively lay out the technology in new industrialization, informationtechnology application, urbanization, and agricultural modernization, make layoutin the core fields of new energy vehicles, intelligent connected vehicles andautonomous driving, and accelerate the construction of a future-oriented andglobally competitive business ecosystem through the overall synergy and theintegration of the new industrialization, information technology application,urbanization, and agricultural modernization. JMC is committed to building aleading and perfect digital system to make the product design, manufacturing,delivery, after-sales service and other parts closer to user needs through in-depthdata mining and demand analysis, so as to promote the pace of its digitaltransformation.

III. Business PlanIn 2024, the Company plans to achieve the sales volume of 360 thousand unitsand the operation revenue of about RMB 37.8 billion, up 16% and 14%

respectively compared with 2023. In order to further improve the managementquality, the Company will devote itself to the following aspects in 2024:

(1) To stabilize and enhance JMC’s leading position in the field of lightcommercial vehicles, continue to strengthen private sphere marketing andpromoting brand upward;

(2) To accelerate the transformation of passenger car channels from “FamilySpace” to “Ford Beyond”, continue to empower dealers, strengthen customeroperations, and further build the image of China’s top outdoor life leader;

(3) To strengthen the promotion of the new energy capacity brand of “JMC fun-to-drive”, vigorously promote the new marketing model, and accelerate thecultivation of the new business of capacity operation;

(4) To deepen synergistic cooperation with shareholders, enrich product portfolio,expand overseas market scale, and continuously improve overseas serviceexperience;

(5) To always adhere to the customer-centric concept, deeply understand marketchanges and customer needs, and provide customers with high-quality productsand services through continuous innovation and efficient synergy;

(6) To put into production and launch new Ford high-end off-road models,passenger car MCA, light trucks and passenger car hybrid models, etc. in a high-quality manner to enhance product competitiveness;

(7) To continuously promote cost reduction, efficiency improvement, and leanmanagement, and build an efficient and agile organization to lay a solidfoundation for the company’s overall strategic development.

IV. Potential Risks and SolutionsGeopolitical conflicts are intensifying in 2024, and the momentum of worldeconomic growth is insufficient. Throughout the country, it was proposed at theCentral Economic Work Conference to continue to act on the principle of seekingprogress while maintaining stability, promoting stability through progress, andestablishing the new before abolishing the old. The effect of growth stabilizationpolicy will continue to appear, domestic demand is expected to be repairedcontinuously, consumption is expected to be further recovered, and infrastructureand manufacturing investment is expected to grow faster, bringing greateropportunities than challenges and stronger favorable conditions than unfavorablefactors. However, the marketization of new energy vehicles accelerates, new car-making forces rise strongly, and the intelligent and digital paces accelerate at thesame time, leading to more intense industrial competition in price, and bringinggreater challenges to the company’s operations. In order to maintain steadygrowth, JMC will focus on the following aspects:

(1) To adhere to the customer-centric concept, gain in-depth insight intocustomer needs and changes in the market environment, explore new businessgrowth points, and get in on the ground floor in the disruptive industry changes;

(2) To optimize new energy product portfolio, expand channels, upgrade servicelevels, construct a new model for development, and increase the sales andpenetration rate of new energy products;

(3) To have an in-depth insight into overseas markets, focus on promoting the“one country one policy” overseas strategy, and optimize and enhance overseaschannels;

(4) To accelerate the construction of key technologies in the fields of intelligentconnection network, intelligent cockpit and intelligent driving, as well as the keytechnological breakthroughs in new energy hardware and software;

(5) To continuously deepen the company’s digital transformation, break downdata silos, enhance digital experience in such three dimensions as customerinsight, user experience and innovative services, and improve operationalefficiency;

(6) To strengthen the quality awareness of all staff, enhance the control of high-risk suppliers, and comprehensively improve product quality;

(7) To continuously promote cost reduction, expenses control and efficiencyenhancement, meanwhile, strengthen the management and control of operatingcash flow to improve the quality of operations;

(8) To strengthen corporate governance, strictly comply with national laws andregulations, and improve risk assessment and control mechanisms.

JMC will focus on light commercial vehicles, follow the customer-centric concept,continue to strengthen the marketing system reform, promote brand upgradingand channel rejuvenation, and consolidate the core competitiveness of lightcommercial vehicles; it will attach equal importance to passenger cars andcommercial vehicles, accelerate the transformation of passenger car channels,enhance market awareness, and seize the momentum to increase the scale ofpassenger car sales; accelerate the development of new energy vehicles;vigorously explore overseas markets; expand new businesses and profit models,and accelerate the development of the new industrialization, informationtechnology application, urbanization, and agricultural modernization as well asdigitalization, deeply promote sci-tech innovation and industrial transformation,and achieve “stable development with solid foundation and additive energy foremerging business”. At the same time, JMC will continue to implement thestrategy of quality leadership, optimize the cost structure, promote cost reductionand efficiency enhancement, improve profitability and create sufficient cash flowto support the Company’s high-quality development.

12. External Research, Communication, and Media Interview to the Company?Applicable □Not Applicable

DateCommunication MethodType of ObjectInformation Discussed and Materials offered
April 14, 2023Online communication through network platformIndividual InvestorsJMC Operating highlights
May 19, 2023Online communication through network platformIndividual InvestorsJMC Operating highlights

13. Implementation of the action program "Double Enhancement of Quality andReturn"Whether the company has disclosed the action plan of "Double Enhancement ofQuality and Return".

□Yes ?No

Chapter IV Corporate Governance Structure

1. Status of the Corporate Governance in JMC

During the reporting period, the Company strictly abided by the Company Law, theSecurities Law, the Code of Corporate Governance for Listed Companies in China,the Rules Governing Listing of Stock on Shenzhen Stock Exchange, as well asrelevant laws and regulations, to carry out corporate governance activities andcontinued to improve its corporate governance.

Whether there are significant differences between the actual situation of corporategovernance in the company and the laws, administrative regulations and that ofregulations on corporate governance of listed companies promulgated by CSRC

□Yes ?No

There is no significant difference between the actual situation of corporategovernance in JMC and the laws, administrative regulations and that ofregulations on corporate governance of listed companies promulgated by CSRC.

2. Separation between JMC and the Controlling Shareholders and actual controllerin respect of Personnel, Assets and Finance, and Independence concerningOrganization and Business:

(1) With respect to personnel matters, the positions of chairman and president areheld by different individuals; JMC’s senior management do not hold positions otherthan director positions with its controlling shareholders; JMC senior managementpersonnel are paid by JMC; labor, personnel matters and compensationmanagement of JMC are completely independent.

(2) With respect to assets, JMC assets are complete. The assets utilized by JMC,including production system, supporting production system and peripheral facilities,and non-patent technology, are owned and/or controlled by JMC.

(3) With respect to finance, JMC has an independent finance department andindependent accounting system, and has a uniform and independent accountingsystem and financial control system for its branches and subsidiaries. JMC has itsown bank accounts, and there are no bank accounts jointly owned by JMC and itscontrolling shareholders. JMC pays taxes independently in accordance withrelevant laws.

(4) With respect to organization, JMC’s organization is independent, complete andscientifically established with a sound and efficient operating mechanism. Theestablishment and the operation of JMC’s corporate governance are strictlycarried out per the Articles of Association of JMC. Production and administrativemanagement are independent from the controlling shareholders. JMC hasestablished an organization structure that meets the need for ongoingdevelopment.

(5) With respect to business, JMC has independent purchasing, production andsales systems. The purchasing, production and sales of main materials andproducts are carried out through its own purchasing, production & sales functions.JMC is independent from the controlling shareholders in respect to its business,

and has independent and complete business and self-sufficient operatingcapability.

3. Horizontal Competition

□Applicable ?Not Applicable

4 Introduction to the Shareholders’ Meetings Held in the Reporting Period

(1) Index to the Shareholders’ Meeting in the reporting period

In 2023, the Company has hold one Shareholders’ Meeting, and the relevantcontents are as follows:

1. Session of the meeting:2022 Annual Shareholders’ MeetingThe meeting type: annual shareholders’ meetingInvestor participation ratio: 74.61%Convening date: June 16, 2023Disclosure date: June 17, 2023The meeting resolutions:

1. approve 2022 Work Report of the Board of Directors of JMC;

2. approve 2022 Work Report of the Supervisory Board of JMC;

3. approve 2022 Annual Report of JMC and the Extracts from such Annual Report;

4. approve 2022 Financial Statements of JMC;

5. approve the proposal on JMC Profit Distribution for Year 2022;

6. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with JMCG Finance Company;

7. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. and itssubsidiaries;

8. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Jiangling Motor Group Co., Ltd. and its subsidiaries;

9. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Ford Motor Company and its subsidiaries;

10. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Nanchang Jiangling HuaXiang Auto Components Co., Ltd.;

11. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Nanchang Baojiang Steel Processing Distribution Co., Ltd.;

12. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Magna PT Powertrain (Jiangxi) Co., Ltd.;

13. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Jiangxi Jiangling Lear Interior System Co., Ltd.;

14. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Jiangxi JMCG Specialty Vehicles Co., Ltd. and its subsidiaries;

15. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Nanchang Faurecia Emissions Control Technologies Co., Ltd.;

16. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with China South Industries Group Corporation and its subsidiaries;

17. approve the Proposal on the Y2023 Routine Related Party TransactionFramework with Nanchang Unistar Electric & Electronics Co., Ltd.;

18. approve JMC Year 2023-2025 Shareholder Return Plan;

19. Election of Directors for the Eleventh Board of Directors of JMC (ExcludingIndependent Directors):

19.01. approve the Proposal on Electing Mr. Qiu Tiangao as a Director of theEleventh Board of Directors of JMC;

19.02. approve the Proposal on Electing Mr. Shengpo Wu as a Director of theEleventh Board of Directors of JMC;

19.03. approve the Proposal on Electing Mr. Ryan Anderson as a Director of theEleventh Board of Directors of JMC;

19.04. approve the Proposal on Electing Ms. Xiong Chunying as a Director of theEleventh Board of Directors of JMC;

19.05. approve the Proposal on Electing Mr. Jin Wenhui as a Director of theEleventh Board of Directors of JMC;

19.06. approve the Proposal on Electing Mr. Yuan Mingxue as a Director of theEleventh Board of Directors of JMC;

20. Election of Independent Directors for the Eleventh Board of Directors of JMC:

20.01. approve the Proposal on Electing Mr. Yu Zhuoping as an IndependentDirector of the Eleventh Board of Directors of JMC;

20.02. approve the Proposal on Electing Mr. Chen Jiangfeng as an IndependentDirector of the Eleventh Board of Directors of JMC;

20.03. approve the Proposal on Electing Ms. Wang Yue as an IndependentDirector of the Eleventh Board of Directors of JMC;

21. Election of Supervisors for the Eleventh Supervisory Board of JMC:

21.01. approve the Proposal on Electing Mr. Xiao Hu as a Supervisor of theEleventh Supervisory Board of JMC;

21.02. approve the Proposal on Electing Mr. Zhang Yangyang as a Supervisor ofthe Eleventh Supervisory Board of JMC;

21.03. approve the Proposal on Electing Mr. Zhang Jian as a Supervisor of theEleventh Supervisory Board of JMC.

(2) Special Shareholders’ Meeting convened by preferred-shareholders whosevoting rights were restored

□Applicable ?Not Applicable

5.Directors, supervisors and senior managers

(1) Basic information

NameGenderAgePositionTerm of OfficeShares at the period-beginningStock optionsrestricted stockShare Change in the reporting periodShares at the period-end
Qiu TiangaoMale57Chairman2023.06.16-2026.06.1500000
Shengpo WuMale57Vice Chairman2023.06.16-2026.06.1500000
Ryan AndersonMale50Director2023.06.16-2026.06.1500000
Yuan MingxueMale55Director2023.06.16-2026.06.1500000
Xiong ChunyingFemale59Director & President2023.06.16-2026.06.151,2000001,200
Jin WenhuiMale56Director2023.06.16-2024.04.1100000
Yu ZhuopingMale63Independent Director2023.06.16-2026.06.1500000
Chen JiangfengMale44Independent Director2023.06.16-2026.06.1500000
Wang YueFemale45Independent Director2023.06.16-2026.06.1500000
Xiao HuMale55Chief supervisor2023.06.16-2026.06.1500000
Zhang YangyangMale44Supervisor2023.06.16-2026.06.1500000
Zhang JianMale54Supervisor2023.06.16-2026.06.154000040
Ma JianMale48Supervisor2023.06.16-2026.06.1500000
Li YanlingFemale46Supervisor2023.06.16-2026.06.1500000
Zhong JunhuaFemale47EVP2024.03.26-2026.06.1500000
Ding WenminMale51EVP2023.06.16-2026.06.1500000
Joey ZhuMale41CFO2023.06.16-2026.06.1500000
Erik HermannMale59VP2023.06.16-2026.06.1500000
Wu XiaojunMale49VP2023.06.16-2026.06.1500000
Xu LanfengFemale54VP &Board Secretary2023.06.16-2026.06.1500000
Liu RangpoMale50VP2023.06.16-2026.06.1500000
Wu JiehongFemale47VP2023.06.16-2026.06.1500000
Yang ShenghuaMale43VP2023.06.16-2026.06.1500000
Sam loMale44VP2023.06.16-2026.06.1500000
Zeng FafaMale45VP2023.06.16-2026.06.1500000
Anderson LiuMale51VP2023.06.16-2026.06.1500000
Total-12400001240

Whether there are any outgoing Directors and Supervisors and the dismissal ofsenior management personnel during the reporting period?

□Yes ?No

Changes of Directors, Supervisors and Senior Management?Applicable □Not Applicable

NamePositionStatusDateReason
Zhong JunhuaEVPEmployment2024.03.26Appointment due to work need.
Jin WenhuiEx-EVPLeave2024.03.26Work rotation.

(2). Employment

The current Directors, Supervisors and Senior Executives’ professionalbackground, main working experience and main responsibilities in the Company:

Directors:

Mr. Qiu Tiangao, born in 1966, holds a Bachelor Degree in MechanicalManufacturing and a Master Degree in Industrial Engineering from HuazhongUniversity of Science and Technology, and is Chairman of JMCG, Chairman ofNanchange Jiangling Investment Co., Ltd., and Chairman of JMC. Mr. QiuTiangao held various positions including General Manager, Chairman ofNanchang Gear Co., Ltd., Chairman of Jiangxi JMCG Gear Co., Ltd., VicePresident of Jiangling Motor Holdings Co., Ltd., and Director & General Managerof JMCG.

Mr. Shengpo Wu, born in 1966, holds a Bachelor’s Degree in Thermal EnergyEngineering from Tsinghua University in Beijing and Master’s Degrees inMechanical Engineering and Information Management, respectively, from theUniversity of Nebraska-Lincoln and the Keller Graduate School of Management ofDeVry University, and is a Group Vice President of Ford, Chairman and President& Chief Executive Officer of Ford China, Vice Chairman of JMC, Vice Chairman ofChangan Ford Automobile Co., Ltd., Chairman of Fuqi Trading (Shanghai) Ltd,and Chairman of Ford Model e Technology (Nanjing) Co., Ltd. Mr. Shengpo Wuheld various positions including Vice President and Regional General Manager forHoneywell Process Solutions in Greater China, President and CEO of Osram’sAsia-Pacific business, President, Asia Pacific, and a member of the GlobalExecutive Committee for Whirlpool Corporation, Managing Director.

Mr. Ryan Anderson, born in 1973, holds a Bachelor’s Degree in Economics fromUniversity of Chicago and a Master’s Degree in Business Administration fromUniversity of Michigan - Ann Arbor, and is Director and CFO of Ford Motor (China)Ltd., Director of JMC, Director of Changan Ford Automobile Co., Ltd. and FuqiTrading (Shanghai) Ltd., Director and President of Ford Model e Technology(Nanjing) Co., Ltd. Mr. Ryan Anderson has held various positions includingTreasurer of Ford Europe, Product Development Controller, Marketing & SalesController of Ford Asia Pacific, Director of Corporate Financial Planning andAnalysis for Ford Motor Company.

Mr. Yuan Mingxue, born in 1968, holds a Bachelor’s Degree in Auto Engineeringfrom Beijing Institute of Technology and an EMBA from China Europe InternationalBusiness School, and is Chief Expert of Chongqing Chang’an AutomobileCompany Limited, Senior consultant of chairman business team and Director ofJMC. Mr. Yuan Mingxue has held various positions including Assistant to thePresident of Chang’an Auto and Executive Vice President of Jiangling HoldingsLimited Company, Assistant to the President and Director of Strategy PlanningDepartment for Chang’an Auto, Assistant to the President and Director ofOverseas Development Department for Chang’an Auto, deputy Secretary of theParty Committee, Vice President, Executive Vice President of Chang’an Auto,Union president.

Ms. Xiong Chunying, born in 1964, senior engineer, holds a Bachelor Degree inAutomobile Engineering from Jiangsu Engineering College, a Master Degree in

Industrial Economics from Jiangxi University of Finance and Economics and anEMBA Degree from China Europe International Business School, and is Presidentand a Director of JMC. Ms. Xiong Chunying held various positions including Chiefof Quality Management Department, Assistant to the President, Vice President,President, Executive Vice President, Director for JMC.

Mr. Jin Wenhui, born in 1967, senior engineer, holds a Bachelor’s Degree inMechanical Manufacturing, a Master’s Degree in Mechanical Engineering fromHuazhong University of Science and Technology and an EMBA Degree in ChinaEurope International Business School, and is a Director of JMC. Mr. Jin Wenhuiheld various positions including Chief of Manufacturing Department, Assistant tothe President, Vice President for JMC, Director, General Manager of JMCGJingma Motors Co., Ltd., and Executive Vice General Manager of Jiangxi-IsuzuMotors Co., Ltd., and Executive Vice President of JMC.

Mr. Yu Zhuoping, born in 1960, holds a Bachelor's Degree in MechanicalEngineering and a Master's degree in Mechanical Engineering from TongjiUniversity and a Doctor's Degree in Automotive Engineering from TsinghuaUniversity, and is Director of Collaborative Innovation Center for Intelligent EnergyVehicles of Tongji University, Chairman of Tongji Automobile Design andResearch Institute Co., Ltd., a Director of Beijing National Hydrogen ZhonglianHydrogen Energy Technology Research Institute Co., Ltd., Chairman and GeneralManager of Shanghai Intelligent New Energy Vehicle Science and TechnologyInnovation Function Platform Co., Ltd., a Counsellor of Shanghai MunicipalPeople's Government, a Deputy Chief Supervisor of China Society of AutomotiveEngineers, an Independent Director of Weichai Power Co., Ltd., an IndependentDirector of Ningbo Shenglong Automotive Powertrain System Co., Ltd., anIndependent Director of Huayu Automotive Systems Co., Ltd and an IndependentDirector of JMC. Mr. Yu Zhuoping held various positions including Director ofSchool of Mechanical Engineering, Executive Deputy Director of New EnergyVehicle Engineering Center, Executive Vice Dean, Dean of School of AutomotiveStudies for Tongji University, and Assistant to the President of Tongji University.

Mr. Chen Jiangfeng, born in 1979, holds a Bachelor’s Degree and Master’sDegree in Law from International Law Department, Foreign Affairs College, and isSenior Deputy General Counsel & Executive Director of Gilead (Shanghai)Pharmaceutical Technology Co., and an Independent Director of JMC. Mr. ChenJiangfeng has held various positions including Legal Counsel of Ford Motor (China)Ltd., Legal Counsel of Ford Motor Research & Engineering (Nanjing) Co., Ltd./Chang’an Ford Mazda Automobile Corporation, Ltd., Nanjing Company/Chang’anFord Mazda Engine Company, Ltd., Senior Legal Counsel & Compliance Officer ofFord Asia Pacific & Africa, Senior Legal Counsel of BMW China AutomotiveTrading Ltd., and Member of China Country Council, Head of legal, Director,Merck Healthcare China.

Ms. Wang Yue, born in 1978, holds a Bachelor’s Degree in Accountancy fromHenan University, a Master’s Degree in Accountancy from Zhongnan University ofEconomics and Law, and a Doctor’s Degree in Accountancy from ShanghaiUniversity of Financial and Economics, and is a Professor of School ofAccountancy for Shanghai University of Financial and Economics, an IndependentDirector of JMC, an Independent Director of Guangdong Yangshan United

Precision Manufacturing Co., Ltd. and an Independent Director of Scivita MedicalTechnology Co., Ltd. Ms. Wang Yue has served as Research Assistant at TheHong Kong Polytechnic University and China Europe International School, andduring 2012~2013, served as Visiting Scholar at Zimmerman Center for Universityof Illinois at Urbana-Champaign.

Supervisors:

Mr. Xiao Hu, born in 1968, holds a Bachelor’s Degree in Radio from InformationScience & Electronic Engineering Department of Zhejiang University, and is amember of the Standing Committee of the CPC, the secretary of DisciplineInspection Commission and Chairman of Supervisory Board for JMCG, and ChiefSupervisor of JMC. Mr. Xiao Hu has served as a cadre in the General Office of theNanchang Municipal People's Government, Deputy Director of the Office of theWorking Committee of the Nanchang Hi-tech Industrial Development Zone, deputydirector of the Software Industry Office of the Nanchang Hi-tech IndustryDevelopment Zone Administrative Committee, Deputy Head of the OrganizationDepartment of the Working Committee of Nanchang Hi-tech Industry DevelopmentZone, Deputy Director of the Personnel and Labor Bureau of the Nanchang Hi-tech Industry Development Zone Administrative Committee, Head of theOrganization Department of the Working Committee of Nanchang Hi-tech IndustryDevelopment Zone, and the Director of the Personnel Bureau of the Nanchang Hi-tech Industry Development Zone Administrative Committee.

Mr. Zhang Yangyang, born in 1979, holds a LLB Degree in International Law fromChina Foreign Affairs University and a LLM Degree from the University ofMichigan Law School (Ann Arbor), is qualified to practice law in People’s Republicof China and in the State of New York, the United States of America, and iscurrently serve as a Director, General Counsel & China Policy Group Lead of FordMotor (China) Ltd., Principle of Beijing Branch for Ford Motor (China) Ltd., aSupervisory of Ford Model e Technology (Nanjing) Co., Ltd., a Supervisor of FordModel E Auto Sales (Shanghai) Co., Ltd and a Supervisor of JMC. Mr. ZhangYangyang previously assumed a series of legal related positions within Fordincluding Managing Counsel for Ford China and ASEAN region, Senior Counselfor Ford China Operations, etc.

Mr. Zhang Jian, born in 1969, holds a College Degree in Secretarial Professionalfrom North China University of Technology, and is Chairman of JMCG LaborUnion, Chairman of Supervisor Board of Nanchang Jiangling Investment Co., Ltd.,and a Supervisor of JMC. Mr. Zhang Jian held various positions includingSecretary of Chairman and Deputy Director of Office for JMC, Director of Office,Director of Communist Party Office, Chief of Publicity Department for JMCG,Assistant to General Manager of JMCG, and Senior Vice Chairman of JMCGLabor Union.

Mr. Ma Jian, born in 1975, holds a College Degree in Mechanical & ElectricalEngineering from Nanchang University of Aeronautical Technology, a MasterDegree in Mechanical Engineering from Huazhong University of Science andTechnology, and is a Supervisor and Chief of Manufacturing Department for JMC.Mr. Ma Jian held various positions including Lead Engineer, Assistant to the Chief,Deputy Chief of Manufacturing Department for JMC, Director of Nanchang factory

for Getrag Powertrain (Jiangxi) Co. Ltd., and Director of Nanchang Factory andDirector of DCT Factory for Magna Powertrain (Jiangxi) Co. Ltd.

Ms. Li Yanling, born in 1977, holds a College Degree in Industrial and TradeEnglish from Nanchang University of Aeronautical Technology, a Bachelor Degreein English from Jiangxi Normal University, and is a Supervisor and Deputy Chief ofPublic Relationship Department for JMC. Ms. Li Yanling held various positionsincluding Assistant to Ford Quality Expert of Quality Control Department, Assistantto Ford Expert of Public Relationship and Legal Affairs Department, ExecutiveAssistant to President, Chief of Translation Office, and Deputy Chief of PublicRelationship Department for JMC.

Senior management:

Ms. Xiong Chunying, please refer to the part of Directors for her resume.

Ms. Zhong Junhua, born in 1976, graduated in Financial Accounting from Schoolof Management, Shijiazhuang Tiedao University, holds a Bachelor’s Degree inEconomics and a MBA Degree, Certified Public Accountant, Senior Accountant,and is a Director of JMCG, a Director of Nanchang Jiangling Investment Co., Ltd.,and an EVP of JMC, in charge of marketing sales & service, and assist thePresident to manage the Company. Ms. Zhong Junhua held various positionsincluding the chief of Assets and Finance Department for JMCG, Chairman ofJMCG Finance Co., Ltd., General Manager, Chairman of Nanchang JianglingDingsheng Investment Management Co., Ltd., Vice General Manager of JMCG,Chairman of Jiangxi JMCG Specialty Vehicles Co., Ltd., and Chairman of JiangxiJiangling Group Special Vehicle Co., Ltd.

Mr. Ding Wenming, born in 1972, holds a Bachelor’s Degree in AutomobileExertion from Wuhan University of Technology, and is an Executive VicePresident of JMC, in charge of the Company's product research and development.Mr. Ding Wenming held various positions including Deputy Chief of ProductDevelopment Center, Chief of Product Planning & Program ManagementDepartment, and Assistant to the President for JMC, Vice President of JMC.

Mr. Joey Zhu, born in 1982, holds a Bachelor’s Degree in Accounting from NanjingUniversity and a Master’s Degree in Financial Engineering from NanyangTechnological University, and is CFO of JMC. Mr. Joey Zhu held various positionsincluding PD Profit Planning Manager, Profit Analysis Manager, Admin & ITController, and PD Finance Controller for Ford Asia & Pacific, Deputy CFO ofCEVT, Sweden, Finance Controller of Byton NEV Company, Senior BusinessDevelopment Manager, CFO of BEV Division, and BEV Strategic PartnershipDevelopment Director for Ford China.

Mr Eric Hermann, born in 1964, holds a Bachelor’s Degree in EngineeringMechanical and a Master’s Degree in Engineering Mechanical from University ofMichigan, and is a Vice President of JMC, in charge of the Company's productresearch and development. Mr. Eric Hermann held various positions in Ford MotorCompany including Light Truck Exhaust Design Engineer, Vehicle NVHSupervisor, VE Launch Leader, Exhaust, AIS & Clutch Supervisor, AIS, Cooling,Exhaust & CAE Manager, BoF Cooling & Mounts Manager, Unibody Exhaust &

AIS Manager, and Global AIS Manager, as well as the Director of PowertrainEngineering Department and Assistant President for JMC.

Mr. Wu Xiaojun, born in 1974, holds an Automobile Design Bachelor’s Degreefrom Wuhan University of Technology and a MBA from Jiangxi University ofFinance and Economics, and is a Vice President of JMC, CEO of New EnergyDivision for JMC, Executive Director and General Manager of Jiangling HeavyVehicle Co., Ltd., in charge of the new energy business of commercial vehicles forthe Company. Mr. Wu Xiaojun held various positions including Chief of QualityDepartment, Assistant to the President for JMC, and Executive Deputy GeneralManager of JMC Heavy Duty Vehicle Co., Ltd.

Ms. Xu Lanfeng, born in 1969, holds a Bachelor’s Degree in Forging Technologyand Equipment from Jiangxi Industry University and a MBA from University ofInternational Business and Economics, and is a Vice President and the BoardSecretary of JMC, in charge of the Company’s human resources and relevantduties of Board Secretary. Ms. Xu Lanfeng held various positions in JMC includingDeputy Plant Manager of Framing Plant, Deputy Chief, Chief of ManufactureDepartment and Assistant to the President of JMC.

Mr. Liu Ranbo, born in 1973, holds a Bachelor’s Degree in Plastic Forming fromWuhan Automotive Polytechnic University, and is a Vice President of JMC andGeneral Manager of Jiangling Motor Sales Co., Ltd., in charge of commercialvehicle sales business of the Company. Mr. Liu Ranbo held various positions inJMC including Marketing Service Manager for Customer Service Department,Regional Manager for East 3 / East 1 District, JMC Light Truck Brand Manager,Sales Director of Jiangling Motors Sales General Company, and Deputy GeneralManager of Jiangling Motor Sales Co., Ltd.

Ms. Wu Jiehong, born in 1976, holds a Bachelor’s Degree in FinanceManagement from Nanchang University and a MBA from Jiangxi University ofFinance and Economics, and is a Vice President of JMC, in charge of the strategicdevelopment of the Company and assist the CFO to support the financial work. Ms.Wu Jiehong held various positions including Assistant to the Chief of FinancialDepartment, Chief of Internal Audit Office, and Chief of Financial Department forJMC, Finance Manager for Ford APA, Chief of Planning Department, andAssistant to the President for JMC.

Mr. Yang Shenghua, born in 1980, holds a Bachelor’s Degree in EnglishLanguage & Literature from Huazhong University of Science and Technology anda Master’s Degree in Business Administration from Nanjing University, and is aVice President of JMC, in charge of purchasing business of the Company. Mr.Yang Shenghua held various positions including Program Purchasing Supervisorof Chang’an Ford Automobile Co., Ltd., Program Purchasing Manager, andPurchasing Strategy & Program Director for JMC.

Mr. Sam Lo, born in 1979, holds a Bachelor's Degree in Mechanical Engineeringfrom National Taiwan University of S&T, China, a Master's degree in MechanicalEngineering from National Taiwan University, China, and is a Vice President ofJMC, in charge of manufacturing business of the Company. Mr. Sam Lo heldvarious positions including Welding area Manufacturing Engineer, Craft Engineer,

Production Superintendent and ME Manager of Ford Lio Ho Motor Company,VOME Implementation Body Manager and Final Assembly Manager of Ford Asia& Pacific, Body Area Manager Advisor of Changan Ford Motor Co., Ltd. HarbinBranch, Plant Launch Manager and Plant Manager of Changan Ford Motor Co.,Ltd. Hangzhou Branch.

Mr. Zeng Fafa, born in 1978, holds a Bachelor's Degree in AutomotiveEngineering from Nanchang University, China, and is a Vice President of JMC, incharge of manufacturing business. Mr. Zeng Fafa held various positions includingDeputy Director of Quality Control Department, Director of New Model ProgramDepartment, Director of Quality Control Department, Director of Quality Control &New Model Program Department, Director of Manufacture Department, and anAssistant to the President of JMC.

Mr. Anderson Liu, born in 1972, holds a Bachelor’s Degree in Liberal Arts-Psychology from National Taiwan University, China, a Master’s Degree in LiberalArts-Psychology from National Chengchi University, China, and a MBA Degreefrom University of Pittsburgh, USA, is a Vice President of JMC and GeneralManager of Jiangling Ford Motor Automobile (Shanghai) Co., Ltd. Mr. AndersonLiu held various positions including Financial Analyst, E-Commerce Manager,Research Manager, Marketing Manager for FLH, Sr. Marketing Manager, VP ofVW Branch Operation, VP of MS for VW Swire, Sales Director, MS Director forFLH, General Manager of Dealer Network Development and Consumer & RetailExperience for Lincoln China, and Executive Vice General Manager of JianglingMotor Sales Co., Ltd.

Positions at the shareholder entities?Applicable □Not Applicable

Positions in other entities?Applicable □Not Applicable

NameShareholder EntityTitleTerm of OfficeCompensation Paid by Shareholder Entity (Y/N)
Qiu TiangaoJICChairman2019.05.28N
Shengpo WuFordGroup Vice President2023.03.01Y
Ryan AndersonFordCFO, Ford China2021.06.01Y
Yuan MingxueJICDirector2019.05.28N
Jin WenhuiJICDirector2019.05.28N
Zhang JianJICChief supervisor2019.05.28N
Zhong JunhuaJICDirector2019.05.28N
Description of the positions in the shareholder entitiesNone.

Name

NameEntityTitleCompensation Paid by Other Entities (Y/N)
Qiu TiangaoJMCGChairmanY
Qiu TiangaoJiangxiISUZU Co., Ltd.ChairmanN
Qiu TiangaoJMCG New Energy Vehicle Co.,ChairmanN
Ltd.
Qiu TiangaoNanchang Jiangling Investment Co. Ltd.ChairmanN
Qiu TiangaoNanchang Intelligent New Energy Vehicle Research InstituteChairmanN
Shengpo WuFord Motor (China) Ltd.Chairman, President and CEON
Shengpo WuLincoln Motor Sales Service (Shanghai) Co., Ltd.ChairmanN
Shengpo WuChangan Ford Automobile Co., Ltd.Vice ChairmanN
Shengpo WuFord Technology (China) Holding, Inc.ChairmanN
Shengpo WuFord Technology (China) Holding LimitedChairmanN
Shengpo WuFord Model e Technology (Nanjing) Co., Ltd.ChairmanN
Shengpo WuFuqi Trading (Shanghai) Ltd.ChairmanN
Shengpo WuWhirlpool (China) Co., Ltd.Vice ChairmanY
Ryan AndersonFord Motor (China) Ltd.Director, Chief Financial OfficerN
Ryan AndersonChang'an Ford Automobile Co., Ltd.DirectorN
Ryan AndersonFuqi Trading (Shanghai) Ltd.DirectorN
Ryan AndersonLincoln Motor Sales Service (Shanghai) Co., Ltd.DirectorN
Ryan AndersonFord Model e Technology (Nanjing) Co., Ltd.Chairman, President, Head of Power Technology branchN
Ryan AndersonFord Technology (China) Holding, Inc.DirectorN
Ryan AndersonFord Technology (China) Holding LimitedDirectorN
Yuan MingxueChongqing Chang'an Automobile Company LimitedChief Expert and Senior Consultant of Chairman Business TeamY
Jin WenhuiJiangling Ford Automobile Technology (Shanghai) Co., Ltd.ChairmanN
Jin WenhuiHanon Systems (Nanchang) Co., Ltd.Vice ChairmanN
Jin WenhuiJiangxi Jiangling Special Purpose Vehicle Co., Ltd.DirectorN
Yu ZhuopingCollaborative Innovation Center for Intelligent Energy Vehicles of Tongji UniversityDirectorN
Yu ZhuopingTongji Automobile Design and Research Institute Co., Ltd.ChairmanN
Yu ZhuopingBeijing National Hydrogen Zhonglian Hydrogen Energy Technology Research Institute Co., Ltd.DirectorN
Yu ZhuopingShanghai Intelligent New Energy Vehicle Science and Technology Innovation Function Platform Co., Ltd.Chairman & PresidentN
Yu ZhuopingHuayu Automotive Systems Co., Ltd.Independent DirectorY
Yu ZhuopingWeichai Power Co., Ltd.Independent DirectorY
Yu ZhuopingNingbo Shenglong Automotive Powertrain System Co., Ltd.Independent DirectorY
Yu ZhuopingShanghai Municipal People's GovernmentCounsellorN
Yu ZhuopingChina Society of Automotive EngineersDeputy Chief SupervisorN
Chen JiangfengGilead (Shanghai) Pharmaceutical Technology Co., Ltd.Executive Director, Senior Deputy General CounselY
Wang YueShanghai University of Finance and EconomicsProfessorY
Wang YueGuangdong Yangshan United Precision Manufacturing Co., Ltd.Independent DirectorY
Wang YueScivita Medical Technology Co., Ltd.Wang YueY
Xiao HuJMCGChairman of Supervisory BoardY
Xiao HuJMCG Jingma Motors Co., Ltd.SupervisorN
Xiao HuJiangxi Jiangling Group Special Vehicle Co., Ltd.SupervisorN
Xiao HuJiangxi Jiangling Chassis Co., Ltd.SupervisorN
Xiao HuJiangling Dingsheng Investment Co., Ltd.SupervisorN
Xiao HuJiangxi Jiangling Real Estate Co., Ltd.Chairman of Supervisory BoardN
Zhang YangyangFord Motor (China) Ltd.Director, General Counsel & China Policy Group Lead, Principal of Beijing BranchY
Zhang YangyangChangan Ford Automobile Co., Ltd.SupervisorN
Zhang YangyangFord Motor Research & Engineering (Nanjing) Co., Ltd.SupervisorN
Zhang YangyangFord Motor Research & Testing (Nanjing) Co. Ltd.SupervisorN
Zhang YangyangFuqi Trading (Shanghai) Ltd.SupervisorN
Zhang YangyangFord Model e Technology (Nanjing) Co., Ltd.SupervisorN
Zhang YangyangFord Model E Auto Sales (Shanghai) Co., LtdSupervisorN
Zhang YangyangFord Model e Automobile Sales (Nanjing) Co., Ltd.SupervisorN
Zhang YangyangLincoln Motor Sales Service (Shanghai) Co., Ltd.SupervisorN
Zhang YangyangJiangling Ford Automobile Technology (Shanghai) Co., LtdSupervisorN
Zhang YangyangFord Technology (China) Holding, Inc.DirectorN
Zhang JianJMCGChairman of the Labor UnionY
Zhang JianNanchang Jiangling Investment Co. Ltd.Chairman of Supervisory BoardN
Zhang JianJMCG New Energy Automobile Co. Ltd.SupervisorN
Zhang JianJiangxi Jiangling Special-Purpose Vehicle Co., Ltd.SupervisorN
Zhang JianJiangxi JMCG Specialty Vehicles Co., Ltd.SupervisorN
Zhang JianNanchang Gear Co., Ltd.Chief SupervisorN
Zhang JianJMCG Finance Co., Ltd.Chief SupervisorN
Zhang JianJiangxi Lingrui Renewable Resources Development Co., Ltd.SupervisorN
Zhang JianJiangxi Jiangling Real Estate Co.,LtdSupervisorN
Zhang JianJiangxi Jiangling Motors Imp. & Exp. Co., Ltd.Chief SupervisorN
Zhang JianMagna Powertrain (Jiangxi) Co. Ltd.SupervisorN
Zhang JianJiangxi Yizhizhixing Automobile Operation Service Co., Ltd.SupervisorN
Zhong JunhuaJMCGDirectorY
Zhong JunhuaJiangling Motor Sales Co., Ltd.Executive DirectorN
Ding WenmingJMCGDirectorN
JoeyZhuJiangling Ford Automobile Technology (Shanghai) Co., Ltd.DirectorN
JoeyZhuHanon Systems (Nanchang) Co., Ltd.DirectorN
JoeyZhuJiangling Motor Sales Co., Ltd.SupervisorN
Wu XiaojunJMC Heavy Duty Vehicle Co.,ExecutiveN

Penalties from securities regulator to the present and resigned Directors,Supervisors and Senior Executives in the recently three years

□Applicable ?Not Applicable

(3). Compensation of Directors, Supervisors and Senior ExecutivesDecision-making procedure, determination of basis, and actual payment regardingthe compensation of the Directors, Supervisors and Senior Executives

Directors and Supervisors who did not concurrently hold other managementpositions in JMC were not paid by JMC. Director Qiu Tiangao, Supervisor Xiao Huand Supervisor Zhang Jian were paid by JMCG. Director Shengpo Wu andDirector Ryan Anderson were paid by Ford. Supervisor Zhang Yangyang was paidby Ford Motor (China) Ltd.. Director Yuan Mingxue were paid by ChongqingChang’an Automobile Co., Ltd.

(a) In accordance with JMC Executive Compensation Scheme approved by theBoard of Directors, the compensation for the Chinese-side senior managementconsists of base salary and floating bonus. The base salary level is determinedaccording the grade of the senior executives, and the floating bones shall be paidaccording to the operating performance. 70% of the bonus will be distributed inthis year, and the rest 30% will be distributed in the next three years. In 2023, theCompany paid annual compensation before tax of approximately RMB 1,820thousand to EVP Ding Wenmin, paid approximately RMB 1,460 thousand to VPWu Xiaojun, paid approximately RMB 1,450 thousand to VP & Board Secretary XuLanfeng, paid approximately RMB 1,420 thousand to VP Liu Rangpo, paidapproximately RMB 1,470 thousand to VP Wu Jiehong, paid approximately RMB1,310 thousand to VP Zeng Fafa, paid approximately RMB 900 thousand toEmployee-representative Supervisor Ma Jian, paid approximately RMB 440thousand to Employee-representative Supervisor Li Yanling, and paid annualcompensation before tax of approximately RMB 2,010 thousand to Director & Ex-EVP Jin Wenhui. The total compensation before tax paid by JMC for the aforesaidpersons was about RMB 12.28 million in the reporting period, including the long-term incentive of RMB 810 thousand deferred from the previous years.

Ltd.Director, General Manger
Wu XiaojunShenzhen Fujiang New Energy Automobile Sales Co., Ltd.Executive DirectorN
Wu XiaojunGuangzhou Fujiang New Energy Automobile Sales Co., Ltd.Executive DirectorN
Wu XiaojunShanxi Yunnei Power Co., Ltd.DirectorN
Liu RangpoJiangling Ford Automobile Technology (Shanghai) Co., Ltd.DirectorN
Liu RangpoJiangling Motor Sales Co., Ltd.General ManagerN
Wu JiehongJMC Heavy Duty Vehicle Co., Ltd.SupervisorN
Wu JiehongShanxi Yunnei Power Co., Ltd.DirectorN
Wu JiehongShenzhen Fujiang New Energy Automobile Sales Co., Ltd.SupervisorN
Anderson LiuJiangling Ford Automobile Technology (Shanghai) Co., Ltd.General ManagerN
Description of the positions in other entitiesNone

(b)JMC pays annual compensation for Ford-seconded senior managementpersonnel to Ford in accordance with the Personnel Secondment Agreementsigned between JMC and Ford & Ford Affiliates. In 2023, the Company should payapproximately RMB 1,100 thousand to Ford for Director and President XiongChunying, pay approximately RMB 1,100 thousand for CFO Joey Zhu, payUS$ 500 thousand for VP Erik Hermann, pay RMB 1,100 thousand for VP YangShenghua, pay RMB 1,100 thousand for VP Sam Lo, pay RMB 4,210 thousand forVP Anderson Liu. These payments made by JMC to Ford do not reflect the actualsalaries earned by Ford-seconded senior management.

(c) Pursuant to the resolutions of JMC 2011 Annual Shareholder’s Meeting, theannual compensation for the JMC Independent Directors is RMB 100 thousandper person, and JMC bears their travel-related expenses associated with JMC’sbusiness. In 2023, the Company paid annual compensation before tax of RMB100 thousand to Independent Director Yu Zhuoping, Independent Director ChenJiangfeng, and Independent Director Wang Yue respectively.

Table on compensation of the Directors, Supervisors and Senior Executives in thereporting period

Unit: RMB’ 000

NameGenderAgePositionPresent (Y/N)Compensation Before Tax Paid by JMCCompensation Paid by Related Party (Y/N)
Qiu TiangaoMale57ChairmanY0Y
Shengpo WuMale57Vice ChairmanY0Y
Ryan AndersonMale50DirectorY0Y
Yuan MingxueMale55DirectorY0Y
Xiong ChunyingFemale59Director & PresidentY*Y
Yu ZhuopingMale63Independent DirectorY100Y
Chen JiangfengMale44Independent DirectorY100Y
Wang YueFemale45Independent DirectorY100Y
Xiao HuMale55Chief supervisorY0Y
Zhang YangyangMale44SupervisorY0Y
Zhang JianMale54SupervisorY0Y
Ma JianMale48SupervisorY900Y
Li YanlingFemale46SupervisorY440Y
Ding WenminMale51EVPY1,820Y
Joey ZhuMale41CFOY*Y
Erik HermannMale59VPY*Y
Wu XiaojunMale49VPY1,460Y
Xu LanfengFemale54VP &Board SecretaryY1,450Y
Liu RangpoMale50VPY1,420Y
Wu JiehongFemale47VPY1,470Y
Yang ShenghuaMale43VPY*Y

*See the instructions in the previous paragraph.

6. Directors’ Performance of Duty

(1) Introduction to the Board of Directors

Sam loMale44VPY*Y
Zeng FafaMale45VPY1,310Y
Anderson LiuMale51VPY*Y
Jin WenhuiMale56Director & Ex-EVPN2,010N
Total----12,580-

Meeting

MeetingConvening DateDisclosure DateMeeting Resolutions
Paper Meeting2023.03.17-03.282023.03.301. Approved to submit to the 2022 Annual Shareholders’ Meeting the proposal on Year 2022 profit distribution; 2. Approved the 2022 Annual Report of the Company and the Extracts from such Annual Report; 3. Approved the 2022 Work Report of the Board of Directors of the Company; 4. Approved the 2022 Financial Statements of the Company; 5. Approved the 2022 Internal Control Self-assessment Report of the Company; 6. Approved the 2022 Corporate Social Responsibility Report of the Company; 7. Approved JMCG Finance Company Continuous Risk Assessment Report; 8. Approved the 2022 Assets Impairment Provisions & Write-off proposal of the Company.
Twelfth Session of the Tenth Board2023.03.24No matters that should be disclosed are involved.
Paper Meeting2023.04.19-04.262023.04.27Approved the Company’s 2023 First Quarter Report.
Paper Meeting2023.05.21-05.242023.05.261. Agreed JMC Year 2023-2025 Shareholder Return Plan, and to submit it to the Shareholders’ Meeting for approval; 2. Agreed to submit the proposal on election of Directors for the new Board of Directors to the Shareholders’ Meeting for approval; 3. Approved the Notice on Holding 2022 Annual Shareholders’ Meeting of JMC.
First Session of the Eleventh Board2023.06.162023.06.171. Elected Mr. Qiu Tiangao as the Chairman of JMC and Mr. Shengpo Wu as the Vice Chairman of JMC; 2. approved the composition of the special committees under the Board; 3. Appointed the Senior Executives;

(2) Particulars about the Directors’ attendance to the Board meeting and theShareholders’ Meeting

Statements on failure to attend Board meetings in person for two consecutiveoccasionsNone.

(3) Dissent from Directors

□Yes ?No

4. Approved the Executive Committee shall be comprised.
Paper Meeting2023.06.17No matters that should be disclosed are involved.
Paper Meeting2023.06.27-06.292023.07.01Approved the Service Contract for Ford All New F-150 Raptor Between Jiangling Ford Automobile Technology (Shanghai) Co., Ltd., a subsidiary of the Company, and Ford Motor (China) Ltd.
Paper Meeting2023.08.21-08.282023.08.30

1. Approved JMC 2023 Half-year

Report and the Extracts from suchReport;

2. Approved JMCG Finance

Company Continuous RiskAssessment Report.

Second Session of the Eleventh Board2023.10.09No matters that should be disclosed are involved.
Paper Meeting2023.10.17-10.242023.10.25Approved the Company’s Third Quarter Report.
Third Session of the Eleventh Board2023.12.082023.12.12Approved the 2024 Routine Related Party Transaction Forecast Proposal.
Paper Meeting2023.12.09No matters that should be disclosed are involved.

Name

NameRequired Board AttendancePresence in PersonPresence in form of Paper MeetingPresence by ProxyAbsenceNot to present in person in two consecutive meetings (Y/N)Presence at the Shareholders’ Meeting
Qiu Tiangao1248--N1
Shengpo Wu1248--N1
Ryan Anderson1248--N-
Yuan Mingxue12381-
Xiong Chunying1248--N1
Jin Wenhui1248--N1
Yu Zhuoping1248--N1
Chen Jiangfeng1248--N1
Wang Yue1248--N1

The Directors of the Company had no dissent to the relevant proposals of theCompany in the reporting period.

(4) Other introduction to Directors’ Performance of Duty

Whether the Directors' suggestions on the Company have been adopted?Yes □NoStatement of the adoption or not of the Directors’ suggestions on the CompanyAll the Directors of the Company fulfill their duties diligently, actively pay attentionto the Company’s management information, financial situation, and major issues,make thoroughly study and discussion on the proposals submitted to the Board ofDirectors and put forward their respective opinions, make recommendations forthe Company's business development, fully consider the interests and demands ofminority shareholders while making decisions, which strengthens the scientific ofthe Board’s decision, and promotes the sustainable, stable and healthydevelopment of the Company’s operation.

7. Situation of the Committees under the Board of Directors in the ReportingPeriod

(1) Audit Committee

Members:

Chairman: Wang YueMember: Ryan Anderson, Yuan Mingxue, Yu Zhuoping, Chen JiangfengSecretary: Joey Zhu

The number of meetings held in the reporting period: five.

The first Audit Committee meeting of 2023 was convened on January 13,2023. Meeting contents:

Reviewed the 2022 Annual Financial and Accounting Statements of JMC, andwould review the Company's financial and accounting statements again after theauditor forms the preliminary audit opinions.

Important comments and suggestions made: None.

Other performance of duties: None.

Details of the objection to matter: None.

The second Audit Committee meeting of 2023 was convened on February 22,2023. Meeting contents:

Reviewed the Company's financial report after the certified auditor issued itsinitial audit opinions.

Important comments and suggestions made: None.

Other performance of duties: None.

Details of the objection to matters: None.

The third Audit Committee meeting of 2023 was convened on March 3, 2023.Meeting contents:

1.Reviewed the PwC Report;

2.Reviewed the 2022 Financial Report audited by the auditor and agreed tosubmit it to the Board of Directors for approval;

3.Reviewed the Annual Audit Summary Report of External Auditors andagreed to submit it to the Board of Directors for approval;

4.Reviewed the 2022 Internal Control Self-Evaluation Report and agreed tosubmit it to the Board of Directors for approval;

5.Reviewed the Audit Committee Performance Report and agreed to submit itto the Board of Directors for approval;

Important comments and suggestions made: None.

Other performance of duties: None.

Details of the objection to matters: None.

The forth Audit Committee meeting of 2023 was convened on June 15, 2023.Meeting contents:

1.Reviewed the Internal Control Work Report for the first half of 2023 and theWork Plan for the second half of 2023;

2. Reviewed the PwC Report.

Important comments and suggestions made: None

Other performance of duties: None.

Details of the objection to matters: None.

The fifth Audit Committee meeting of 2023 was convened on December 8,2023. Meeting contents:

1.Reviewed the PwC Report;

2.Reviewed the Year 2023 Assets Impairment Provision Report and agreed tosubmit it to the Board for review;

3.Reviewed and approved the 2023 annual financial report audit timing plan ;

4.Reviewed and approved the Revision of Internal Control DeficiencyDetermination Criteria;

5.Reviewed the 2023 Internal Control Work Report and approved the InternalAudit Work Plan for 2024.

Important comments and suggestions made: The Audit Committeerecommended the company pay more attention to the operating risk of exportbusiness.

Other performance of duties: None.

Details of the objection to matters: None.

(2) Compensation Committee

Members:

Chairman: Chen Jiangfeng

Member: Qiu Tiangao, Ryan Anderson, Yu Zhuoping, Wang Yue

Secretary: Xu Lanfeng

The number of meetings held in the reporting period: one.

A Compensation Committee meeting was convened on March 3, 2023.Meeting contents:

1. Reviewed and approved the Proposal on 2022 Year-end Bonus for theCompany’s senior executives;

2. Reviewed and approved the adjustment of the annual total cash incometarget of the Company’s senior executives in 2023;

3. Reviewed and approved the KPIs for the Company’s senior executives in2023;

5. Reviewed and approved the 2022 Due Diligence Report of theCompensation Committee.

Important comments and suggestions made: None.Other performance of duties: None.Details of the objection to matters: None.

(3) Strategy Committee

Members:

Chairman: Qiu TiangaoMember: Shengpo Wu, Ryan Anderson, Yuan Mingxue, Xiong Chunying, JinWenhuiSecretary: Wu Jiehong

The number of meetings held in the reporting period: one.

A Strategy Committee meeting was convened on December 8, 2023. Meetingcontents:

1. The Company’s strategic focus review;

2. Commercial vehicle new energy strategy report.

Important comments and suggestions made: agreed to the company's newenergy strategy of commercial vehicles and should strengthen the implementationof the Company's strategy.

Other performance of duties: None.

Details of the objection to matters: None.

8. Works of Supervisory Board

Risks found by the Supervisory Board in the reporting period

□Yes ?No

The Supervisory Board had no dissent on inspection items in the reporting period.

9. Employees

(1) Employees, Professional Structure and Educational Level

Employees in parent company at the end of reporting period(person)11,395
Employees in subsidiaries at the end of reporting period(person)224
Total employees at the end of reporting period(person)11,619
Total employees paid compensation (person)12,260
Retired employees bore retirement benefits in parent company and its subsidiaries641
Professional Structure
TypeEmployees (Person)
Production Worker7,093
Sales Personnel704
Technical Personnel3,052
Finance Personnel138
Administrative Staff632
Total11,619
Educational Level
TypeEmployees (Person)
Master degree and higher908

(2) Compensation Policy

JMC strictly abided by the relevant requirements of national labor laws andregulations, and provided safe and comfortable work places. The Company alsoestablished and improved the incentive system that can effectively help therealization of the Company’s strategy and targets, based on the characteristics ofthe business and talents. The Company promoted the multi-talent incentivesystem with orientation on value, ability and contribution, so as to accelerate thegrowth of new automobile talents. The Company also strengthened the connectionbetween personal interests of core talents and the company's medium and long-term strategic goals, thus driving the achievement of business objectives. At thesame time, the Company constantly improved employee welfare policies to meetthe diversified individual needs of employees and improve the employees’experience and satisfaction.

(3) Training

In 2023, JMC focused on the talent transformation and cultivation in the field ofnew automotive technologies and skills. By building an efficient and dynamiclearning environment, it was committed to improving the learning experience andeffectiveness, and providing employees with a broad platform and abundantresources. This initiative aimed to provide solid human resources support for therealization of the Company’s strategic goals, helping the Company meet thechallenges of the industry in the fields of new energy, intelligent connectionnetwork and intelligent manufacturing.

(4) Labour outsourcing

□Applicable ?Not Applicable

10. Profit distribution and capital reserve conversion

Establishment, implementation or adjustment of profit distribution policy, esp. cashdividend distribution policy, regarding common stock during the reporting period?Applicable □Not ApplicableIn accordance with the requirements of laws, regulations and the Articles ofAssociation of the Company, the Company's profit distribution policy maintainscontinuity and stability, and the Company pays attention to the reasonable returnto investors. The Company gives priority to cash dividend, and subject to theprovisions of laws, regulations and the Articles of Association of the Company, theBoard of Directors can put forward a mid-term or special profit distributionproposal. The Company's profit distribution policy is in line with the CSRC'sguidance on encouraging cash dividends for listed companies.

Undergraduate degree3,506
Polytechnic school degree1,444
Below polytechnic school degree5,761
Total11,619

Special Explanation on Cash Dividend Policy

Special Explanation on Cash Dividend Policy
Whether to comply with the requirements of the Articles of Association of JMC or resolution of the Shareholders’ Meeting (Y/N)Y
Whether the standards and proportion of dividends on profit distribution are clear (Y/N)Y
Whether the procedures are valid and legal (Y/N)Y

The Company made a profit during the reporting period and the profit of the parentcompany distributable to the common shareholders is positive, but a distributionplan of cash dividends for the common shares is not put forward

□Applicable ?Not Applicable

Proposal on Year 2023 Profit Distribution Plan or Capital Reserve Conversion?Applicable □Not Applicable

11. Implementation of Equity Incentive Plan, Employee Stock Ownership Plan andOther Employee Incentive Method

□Applicable ?Not Applicable

There was neither equity incentive plan or ESOP, nor other employee incentivemethod during the reporting period.

12. Internal control system construction and implementation during the reportingperiod

(1) Internal control construction and implementation

According to the requirements of the Basic Standard for Enterprise InternalControl (C-SOX) along with its Application Guidelines and Internal ControlGuidelines for Public Companies listed on the Shenzhen Stock Exchange jointly

Whether the Independent Director fulfil their duties (Y/N)Y
Whether middle and small shareholders have opportunities to claim their appeals and their legal rights and interests are completely protected (Y/N)Y
Whether the condition and procedure are reasonable and transparent when the cash dividend policy is being changed (Y/N)Y

Stock dividend (share) for every 10 shares

Stock dividend (share) for every 10 shares0
Cash Dividend (RMB) for every 10 shares (including tax)6.84
Total share capital (share)863,214,000
Total cash dividend distribution amounts (RMB) (including tax)590,438,376
Amount of cash dividend (RMB) in other ways (e.g. repurchase of shares)0
Total cash dividend amounts (RMB) (including other ways)590,438,376
Distributable profit (RMB)8,232,632,623
Total cash dividends (including other ways) as a proportion of total profit distribution100%
Cash dividend status
If the development stage of the Company is not easy to distinguish but there are major fund expenditure arrangements, the minimum proportion of cash dividends in this profit distribution shall reach 20% when the profit distribution is carried out.
Detailed description of profit distribution or capital reverse conversion proposal
Proposal on year 2023 profit distribution: the Company plans to distribute a cash dividend of RMB 6.84 (including tax) for every 10 shares held. Based on the total share capital of 863,214,000 shares as of December 31, 2023, the total cash dividend distribution amounts shall be RMB 590,438,376. The cash dividend on B share shall be paid in Hong Kong Dollars and converted at the middle rate of the HK dollar’s exchange rate against RMB quoted by the People’s Bank of China on the first working day following the relevant resolution adopted by the Company’s Annual Shareholders’ Meeting. The Board decides not to convert the capital reserve to the share capital this time. The proposal is subject to the approval of the Company’s 2023 annual shareholders’ meeting.

issued by the Ministry of Finance and China Security Regulation Commission, theCompany has established a set of sound and effective internal control system, andat the same time, combined with the internal and external environment, internalinstitutions and management requirements, so as to make the internal controlsystem design scientific, simple, applicable and effective operation.

The Company has reasonably planned the organizational structure, andestablished a control structure with the full participation of the Audit Committee,Executive Committee, senior management and business level under theleadership of the Board of Directors. The Audit Committee has an auditdepartment, which supervises and evaluates the operation of the Company'sinternal control system through internal audit.Through the operation, analysis and evaluation of the internal control system, theCompany has effectively prevented the risks in the operation and management,and promoted the realization of the internal control objectives.

This year, the Company's internal control can cover the main aspects of theCompany's operation and management without major omissions; the units,businesses and matters and high-risk areas included in the evaluation scopecover the main aspects of the Company's operation and management withoutmajor omissions.

(2) Major defect of internal control in the reporting period

□Yes ?No

13.The Company's management control over the subsidiaries during the reportingperiod

□Applicable ?Not Applicable

During the reporting period, the Company has not purchased new subsidiaries.

14. Internal Control Self-Assessment Report or Internal Control Audit Report

(1) Internal Control Self-Assessment Report

Issuance dateMarch 30, 2024
Indexwww.cninfo.com.cn
Total value of assets of the entities in scope counts as % of that disclosed in the consolidated financial statements100.00%
Total value of operating revenue of the entities in scope counts as % of that disclosed in the consolidated financial statements100.00%
Deficiency Determination Criteria
TypeTypeType
Qualitative CriteriaMaterial Weakness: An error that changes the trend of results, changes profit to loss or loss to profit; Ineffective anti-fraud process or any fraud involving senior management; Ineffective control over accounting policies; Ineffective oversight by the Audit Committee Significant Deficiency: Errors in management reporting systems orMaterial Weakness: Unscientific decision making process such as incorrect decisions that result in unsuccessful mergers and acquisitions; Major regulatory compliance issues; Frequent media reports harmful to the Company’s reputation; A lack of control within key business processes or systematic

(2). Internal Control Audit Report

?Applicable □Not Applicable

Abnormal opinion issued by the accounting firm

□Yes ?No

Corporate accounting records that could lead to incorrect management decisions; Actions inconsistent with Company values, policies, approval authorities and other Corporate guidelines that are likely to significantly impact cost, quality, customer satisfaction, reputation, or competitive advantage; Significant control issues in IT infrastructure or applications that creates significant risk to corporate assets or processes; Identification of fraud of a significant magnitude or theft that is significant in value Minor Deficiency: Any control deficiencies that do not meet the criteria for material or significantbreakdown of control policies; Material weakness identified in the self-assessment without any action plan implemented Significant Deficiency: a control deficiency, or combination of control deficiencies, that does not meet; The criteria for material weakness but deserves the concerns of the Audit Committee and the Board of Directors Minor Deficiency: Any control deficiencies that do not meet the criteria for material or significant
Quantitative CriteriaMaterial Weakness: Misstatement in the Financial Report is more than 1% of the total assets or 1% of the annual sales revenue in the latest audited consolidated Financial Statements, the lower of the two indicators above Significant Deficiency: Misstatement in the Financial Report is more than 0.5% of the total assets or 0.5% of the annual sales revenue in the latest audited consolidated Financial Statements, the lower of the two indicators above Minor Deficiency: All the deficiencies that don’t meet the quantitative criteria for significantPlease refer to internal control deficiency over financial reporting for the criteria for non-financial reporting internal control.
Number of Material Weakness in financial report0
Number of Material Weakness in non-financial report0
Number of Significant Deficiency in financial report0
Number of Significant Deficiency in non-financial report0

Opinions in the Internal Control Audit Report

Opinions in the Internal Control Audit Report
The comments in the Internal Control Audit Report issued by PWC Zhongtian Accountants (special general partnership) are as follows: On December 31, 2023, JMC maintained effective internal control of financial reporting in all major aspects in accordance with the Basic Code for Enterprise Internal Control and relevant provisions.
Disclosure of Internal Control Audit ReportDisclosed
Issuance DateMarch 30, 2024
Indexwww.cninfo.com.cn
Type of OpinionStandard and unqualified opinions
Major Defect Regarding Non-financial Report or noNo

Whether the Opinion issued by the accounting firm keeps the same with that ofself-assessment report made by the Board??Yes □No

15.Situation of Problem Rectification for the self-inspection of the special actionfor the governance of listed companies

According to the deployment of China Securities Regulatory Commission, in 2021,the Company organized the self-inspection of the special action for thegovernance of listed companies. After self-inspection, the Company did not findany situation that needs to be rectified.

Chapter V Environment and Social Responsibilities

1.Major Environmental issues

(1) Environmental protection

Whether the Company and affiliates is the key pollution discharge unit publishedby environmental protection administration??Yes □No

Environmental protection related policies and industry standardsIn 2023, the State updated the “Technical Specification for Setting IdentificationSigns of Hazardous Waste”, the “Standard for Pollution Control on HazardousWaste Storage” and the “Stationary Source Emission—Specifications forContinuous Monitoring of Nonmethane Hydrocarbons”, and other importantregulations. JMC updated the storage signs of all hazardous waste stations asrequired, strictly regulated the storage conditions of all hazardous waste stations,and followed the requirements to operate exhaust gas online monitoringequipment to ensure the effective treatment of wastes and exhaust gases, andsafeguard the stable and standardized emission of pollutants.

Situation of administrative permit for environmental protectionIn the process of environmental operation control, the Company takes the initiativeto analyze and foresee the current and future hidden worries, actively takespreventive measures, and makes targeted countermeasures to implementimprovements. In terms of new construction, expansion and reconstructionprojects, the Company should make comprehensive environmental protectionplanning and "three simultaneous" assessment, and always implement theconcept of energy saving and low carbon from the design source. In 2023, thecompany's XiaoLan Plant coating SUV wire film pre-treatment technicaltransformation project completed the environmental assessment procedures andpassed the environmental protection completion acceptance; Axle Plant passedthe clean production audit; Cast Plant sewage permit renewal application passed;Other factory discharge permits are within the validity period.

Name of company or subsidiaryJMCJMC
Kind of principal pollutant and specific pollutantWastewater discharge pollutantExhaust emission pollutant
Name of principal pollutant and specific pollutantCOD, NH-NSO2, NOx, NMHC
Mode of dischargeContinuous dischargeContinuous discharge
Number of discharge outlet5150
Distribution of discharge outlet1 in Fushan Site, 2 in Xiaolan Site, 1 in Cast Plant and 1 in Axle Plant38 in Fushan Site, 81 in Xiaolan Site, 28 in Cast Plant and 3 in Axle Plant
Discharge concentrationCOD: 15.73-57.93mg/L; NH-N: 0.81-4.66mg/LNOx: 2-182mg/m?; NMHC: Xiaolan Plant 10.39g/ m2; Fushan Plant 6.11g/ m2;
Particulate matter: 1.2-40.5mg/m?
Applicable standard for pollutant dischargeGan EIA [2015] No. 144; Integrated Wastewater Discharge Standard (GB 8978-1996)Emission Standards for Atmospheric Pollutants from Boilers (GB13271-2014); Volatile Organic Compounds Emission Standards - Part 5: Auto Manufacturing (DB36/1101.5-2019); Emission Standard of Air Pollutants for Foundry Industry (GB 39726—2020)
Total amount of dischargeCOD: 39.43t; NH-N: 2.1tNOx: 53.34t NMHC: Xiaolan Plant 167t, Fushan Plant 75t
Total amount of discharge auditedCOD≤517.39t; NH-N≤24.795tNOx≤95.59t NMHC≤1882.4t
Excessive dischargeMeet StandardMeet Standard

Treatment of pollutantsIn 2023, about 760 thousand tons of wastewater were treated, and the treatedwastewater steadily met the national discharge standards. In order to ensure thestandard discharge of waste gas, the Company stable operation of waste gastreatment facilities. JMC smart environmental supervision platform monitors in realtime to ensure the stable up-to-standard discharge of VOC data. In terms of thewaste management, the Company has adopted intelligent management system tofurther standardize the refined management of hazardous waste. And by means ofsource control, brainstorming, digging into the internal potential, the Company hasactively adopted various measures to reduce waste and cost.

Emergency plan on emergency environmental incidentsIn order to dilute or prevent environmental risks, JMC established an emergencypreparation and response procedure and specific environmental emergency plans,so as to formulate corresponding control methods for potential accidents andemergences occurred or that may probably occur, and has been filed with theenvironmental protection bureau. JMC organized various emergency drills to theeffectiveness of the plan.

Environmental self-monitoring schemeThe Company carries out self-monitoring in strict accordance with therequirements of the state. The monitoring schemes, monitoring results, and annualmonitoring report on pollution sources were disclosed on the government platform.In 2023, the reporting rate of self-monitoring data of the Company's four plants onthe national monitoring platform is 100%.

Relevant information of investment in environmental governance andprotection and payment of environmental protection taxIn 2023, the Company invested approximately RMB 14 million in environmentalremediation, operation and maintenance, of which, RMB 7.61 million for the

disposal of solid wastes, RMB 920 thousand for environmental monitoring andonline operation, RMB 290 thousand for the addition of new VOC onlinemonitoring equipment, and RMB 170 thousand for the optimization of the transferchannel of Xiaolan Hazardous Waste Station. In 2023, JMC invested RMB 160thousand for installing the hazardous waste intelligent terminal equipment in theengine plant and the axle plant, to comprehensively update the hazardous wastevisualization to meet the latest national regulatory requirements; invested RMB160 thousand to renovate the hazardous waste station of the axle plant, and therenovated hazardous waste station met the standardization requirements; in 2023,JMC paid a total of approximately RMB 197,800 for environmental protection tax.

Remarks: The exhaust gas treatment facilities were not counted separately for theoperating expenses due to the overall operation with the production facilities.

Measures and effects taken to reduce carbon emissions during the reportingperiod?Applicable □Not ApplicableJMC has been adhering to green development principle to provide green, energy-saving and environment-protection automobiles and responding to national“double carbon” target, leading low carbon actions. Photovoltaic power generationshelters were built above Xiaolan and Fushan vehicle parking lot and employees’parking lots. By the end of December 2022, all 10 parallel points have beenconnected to the grid for power generation, annual power generation is 74 millionkilowatt hours, which saving 24,272 tons of standard coal per year; reducing CO

emissions by 61,568 tons/year; reducing SO

emissions by 2,220 tons/year;reducing NOxemissions by 1,110 tons/year. In the process of productmanufacturing, energy consumption is reduced by optimizing productionscheduling, balancing production, optimizing process, transforming energy-savingtechnology, advocating green office and other measures. In 2023, the Company'scomprehensive energy consumption per million output value decreased by 7.53%compared with 2022; The comprehensive energy consumption of the Company'ssingle vehicle decreased by nearly 10.18% compared with 2022.

Administrative punishment for environmental problems during the reportingperiodNone.

Other environmental information that should be disclosedNone.

Other environmental protection related informationNone.

2. Corporation Social Responsibilities

Details are contained in the Company's Environmental, Social and Governance(ESG) Report, which was disclosed on March 30, 2024.

3. The consolidation and expansion of poverty alleviation achievements and ruralrevitalization

JMC deeply implemented the decision arrangement of the CPC CentralCommittee on consolidating our gains in poverty elimination and advancing ruralrevitalization across the board, and offered paired assistance to Xianting Village ofSonghu Town of Xinjian District of Nanchang City, Huanggangtou Village andHongxing Village of Liuhu Town of Honggutan New District of Nanchang City, andLuoyang Village of Dafen Town of Suichuan County of Ji’an City according to therequirements of the CPC Jiangxi Provincial Committee and People’s Governmentof Jiangxi Province, and under the leadership of JMCG.

Taking industrial revitalization as a channel, by means of talent dispatching,consumption assistance, etc., JMC deeply promoted rural revitalization work. In2023, the Company purchased more than 5,000 jin of rapeseed oil, 46,000 jin ofyellow peaches, and 120,000 jin of rice from the assisted villages to increasevillagers’ income.

In 2023, JMC donated RMB 2 million to China Foundation for Rural Developmentto implement the “JMC Xiqiao Project”. Since the establishment of the project,JMC has invested more than RMB 38.7 million, benefiting 128 counties in 25provinces (cities and autonomous regions) in China. In 2023, the brand of JMCXiqiao Project was refreshed, and JMC will uphold the new brand proposition of“Building Bridges in the Countryside to Link the Road to Revitalization” to start anew journey full of glory and dreams. With the brand refreshing, JMS’s funding foreach bridge will be raised from RMB 100,000 to RMB 200,000; at the same time,the project introduced the “Internet+” mode to boost rural revitalization, andthrough JMC Smart Drive APP, millions of JMC vehicle owners link with the JMCXiqiao Project to drive more forces to do good and practical things for ruralrevitalization.

JMC Xiqiao Project has been awarded the “Best Practice Case of RuralRevitalization for Listed Companies in 2023” by China Association for PublicCompanies and the first China Fortune “Golden Lion” Excellent Case of RuralRevitalization.

Chapter VI Major events

1. Commitments

(1) Commitments of actual controlling parties, shareholders, related parties,acquirers and the Company finished in the reporting period or overdue unfinishedby the end of the reporting period

□Applicable ?Not Applicable

There is no commitment of actual controlling parties, shareholders, related parties,acquirers and the Company finished in the reporting period or overdue unfinishedby the end of the reporting period.

(2) Earnings forecast of the assets or project and the explanations

□Applicable ?Not Applicable

2. Non-operating funding in the Company occupied by controlling shareholder andits affiliates

□Applicable ?Not Applicable

There was no non-operating funding in the Company occupied by controllingshareholder and its affiliates.

3. Illegal outside guarantee

□Applicable ?Not Applicable

The Company had no illegal outside guarantee during the reporting period.

4.The Board's explanation of the situation related to the latest "non-standard auditReport"

□Applicable ?Not Applicable

5. Explanation of the Board of Directors, Supervisory Board and IndependentDirectors to abnormal opinions from accounting firm

□Applicable ?Not Applicable

6. Description of changes in accounting policies, accounting estimates, orcorrection of major accounting errors compared to the financial report of theprevious year?Applicable □Not ApplicablePlease refer to the Note 2 Summary of significant accounting policies andaccounting estimates (26) Significant changes in accounting policies in theChapter X Financial Statements for details.

7.Description of changes in the scope of consolidated statements as comparedwith the financial statements of the previous year

□Applicable ?Not Applicable

There was no change in the scope of the consolidated statements during thereporting period.

8. Appointment or Dismissal of Accounting Firm

Current appointed accounting firm

NamePricewaterhouseCoopers Zhong Tian LLP
Compensation (RMB’000)1,840
Consecutive years offering audit services22
Names of signed accountantsYe Jun, Xiao Minjie
Consecutive years offering audit services of signed accountantsYe Jun 2 year, Xiao Minjie 2 year

Dismissal of accounting firm

□Applicable ?Not Applicable

Appointment of C-SOX auditor, financial consultant or sponsor?Applicable □Not ApplicableUpon the approval of 2020 Annual Shareholders’ Meeting, JMC appointedPricewaterhouseCoopers Zhong Tian LLP as JMC’s 2022 to 2024 C-SOX auditor.In 2023, JMC paid RMB 440 thousand to PricewaterhouseCoopers Zhong TianLLP for the C-SOX audit.

9. Suspension and Termination of Listing after Annual Report Disclosed

□Applicable ?Not Applicable

10. Related Matters regarding Bankruptcy

□Applicable ?Not Applicable

There was no matter involving bankruptcy during the reporting period.

11. Major Litigation or Arbitration

□Applicable ?Not Applicable

There was no major litigation or arbitration during the reporting period.

12. Punishment

□Applicable ?Not Applicable

Neither JMC nor its Directors or senior management were punished by regulatoryauthorities during the reporting period.

13. Honesty and credit of JMC and its controlling shareholder or actual controllingparty

□Applicable ?Not Applicable

14. Major Related Transactions

(1) Routine related party transactions

Please refer to the Note 7 related party transactions of the notes to theconsolidated financial statements in the Chapter X Financial Statements for details.

(2) Major related party transaction concerning transfer of assets or equity

□Applicable ?Not Applicable

There was no major related party transaction concerning transfer of assets orequity in the reporting period.

(3) Related party transaction concerning outside co-investment

□Applicable ?Not Applicable

(4) Related credit and debt

?Applicable □Not Applicable

Is there non-operating related credit and debt?

□Yes ?No

The Company had no non-operating related credit and debt in the reporting period.

(5) Transaction with related financial companies or financial companies that thecompany holds?Applicable □Not ApplicableDeposit business

Related partyThe related relationshipMaximum daily deposit limitDeposit rateBalance at the beginning of the period(RMB thousands)Current amountBalance at the end of the period (RMB thousands)
Deposit amount (RMB thousands)Take out the amount (RMB thousands)
JMCG Finance CompanySubsidiary of JMCG*0.455%-2.25%886,25013,997,36013,790,7401,092,870

* Note: JMC applies the consolidated deposit limit in JMCG Finance Company atthe end of each month to the lower of the following: 1) 25% of JMCG FinanceCompany absorbing deposit in prior year end; or 2) 12% of JMC’s consolidatedtotal cash reserve.

Loan business

Related partyThe related relationshiploan limit (RMB thousands)Loan rate rangeBalance at the beginning of the period (RMB thousands)Current amountBalance at the end of the period (RMB thousands)
Loan amount (RMB thousands)Repayment amount (RMB thousands)
JMCG Finance CompanySubsidiary of JMCG1,000,0002.5%200,0000200,0000

Granting credit or other financial business

Related partyThe related relationshipType of businessTotal (RMB thousands)Actual amount (RMB thousands)
JMCG Finance CompanySubsidiary of JMCGGranting credit1,300,0000

(6) The transactions between the financial company controlled by the companyand its related parties

□Applicable ?Not Applicable

The Company has no controlling financial company.

(7) Other major related party transactions

?Applicable □Not ApplicablePlease refer to the Note 7 related party transactions of the notes to theconsolidated financial statements for details.

The announcement on Related Party Transactions

NameDisclosure DateWebsite for Disclosure
Public Announcement on Related Party Transactions2023.07.01www.cninfo.com.cn.
Public Announcement on the 2024 Forecast Routine Related Party Transactions2023.12.12www.cninfo.com.cn.

15. Major Contracts and Execution

(1) Entrustment, contract or lease

a. Entrustment

□Applicable ?Not Applicable

There was no entrustment in the reporting period.

b. Contract

□Applicable ?Not Applicable

There was no contract in the reporting period.

c. Lease?Applicable □Not ApplicablePlease refer to the Note 4 (16), note 4 (31) and note 7 (5) (b) of the financialstatements in the Chapter X Financial Statements for detail.

Project of which the profit and loss brought for the company reaches more than 10%of the total profit of the company during the reporting period

□Applicable ?Not Applicable

There was no leasing project of which the profit and loss brought for the Companyreached more than 10% of the total profit of the Company during the reportingperiod.

(2) Major guarantee

□Applicable ?Not Applicable

The Company had no outside guarantee in the reporting period.

(3) Entrustment on cash asset management

a. Trust investment

□Applicable ?Not Applicable

There was no trust investment in the reporting period.

b. Entrusted loan

□Applicable ?Not Applicable

There was no entrusted loan in the reporting period.

(4) Other major contract

□Applicable ?Not Applicable

There was no other major contract in the reporting period.

16. Other Major Events

?Applicable □Not Applicable

In 2023, the Company received government incentives of approximately RMB 550million appropriated from Nanchang Xiaolan Economic and Technological

Development Zone, which is to support the daily operation and development of theCompany.

17.Major event of JMC subsidiary

?Applicable □Not Applicable

On August 23, 2021, by consensus, for transfer of equity interest in JMCH, awholly-owned subsidiary of the Company, the Company signed the Equity InterestTransfer Agreement Relating to100% of the Equity Interests in JMC Heavy DutyVehicle Co., Ltd. with Volvo Lastvagnar Aktiebolag. In 2023, Since the itemsrequired for government approval on the transaction were not completed within theagreed time, the Company and Volvo Lastvagnar Aktiebolag agreed to terminatethe transaction through negotiation. Since the JMCH asset group was idled andthere was no clear plan for its subsequent operation, there was an indication ofimpairment, the Company recorded a corresponding asset impairment provision ofapproximately RMB 244 million in fiscal year 2023 for this asset group.

Chapter VII Share Capital Changes & Shareholders

1. Changes of shareholding structure

I. Table of the changes of shareholding structure

Before the changeChange (+, -)After the change
SharesProportion of total shares (%)New sharesBonus SharesReserve- converted sharesOthersSubtotalSharesProportion of total shares (%)
I. Limited tradable A shares750,8400.09%750,8400.09%
1. Other domestic shares750,8400.09%750,8400.09%
Including:
Domestic legal person shares745,1400.09%750,8400.09%
Domestic natural person shares5,7000.00%5,7000.00%
II. Unlimited tradable shares862,463,16099.91%862,463,16099.91%
1. A shares518,463,16060.06%518,463,16060.06%
2. B shares344,000,00039.85%344,000,00039.85%
III. Total863,214,000100.00%863,214,000100.00%

Causes of shareholding changes

□Applicable ?Not Applicable

Approval of changes of shareholding structure

□Applicable ?Not Applicable

Shares Transfer

□Applicable ?Not Applicable

Impact on accounting data, such as the latest EPS, diluted EPS, shareholders’equity attributable to the equity holders of the Company, generated from sharestransfer

□Applicable ?Not Applicable

Others to be disclosed necessarily or per the requirements of securities regulator

□Applicable ?Not Applicable

II. Changes of limited A shares

□Applicable ?Not Applicable

2. Securities Issuance and Listing

I. Securities issuance (not including preferred shares) in the reporting period

□Applicable ?Not Applicable

II. Explanation on changes of shares, shareholding structure, assets and liabilitiesstructure

□Applicable ?Not Applicable

III. Current staff shares

□Applicable ?Not Applicable

3. Shareholders and actual controlling parties

I. Total shareholders, top ten shareholders, and top ten shareholders holdingunlimited tradable shares

Total shareholders as of the end of the reporting periodJMC had 34,453 shareholders, including 28,740 A-share holders, and 5,713 B-share holders, as of December 31, 2023.
Total shareholders as of the last month-end prior to the disclosure date of the ReportJMC had 28,302 shareholders, including 22,755 A-share holders, and 5,547 B-share holders, as of February 29, 2024.
Top ten shareholders
Shareholder NameShareholder TypeShareholding Percentage (%)Shares at the End of YearChange (+,-)Shares with Trading RestrictionShares due to mortgage or mark or frozen
Nanchang Jiangling Investment Co., Ltd.State-owned legal person41.03%354,176,000000
Ford Motor CompanyForeign legal person32.00%276,228,394000
Hong Kong Securities Clearing Company Ltd. (HKSCC)Foreign legal person3.96%34,213,82828,715,09600
Shanghai Automotive Co., Ltd.State-owned legal person1.51%13,019,610000
Jin XingDomestic Natural Person0.87%7,546,1001,439,90000
Invesco Great Wall New energy industry equity securities investment fundDomestic non-State-owned legal persons0.46%3,984,4003,984,40000
Li YifengDomestic Natural Person0.34%2,930,900277,30000
Jin ShiyaDomestic Natural Person0.27%2,343,512650,46400
Taikang Life Insurance Co., Ltd.- investment linked insurance -Industry ConfigurationDomestic non-State-owned legal persons0.27%2,302,6002,302,60000
GAOLING FUND, L.P.Foreign legal person0.21%1,793,693-3,659,39300
Strategic investors or general legal persons become the top 10 shareholders due to the placement of new sharesNone.
Notes on association among above-mentioned shareholdersShareholders holding more than 5% are not related.
Description of the above shareholders' entrusted / entrusted voting rights and waived voting rightsNone.
A special description of the special repurchase account among the top 10 shareholdersNone.
Top ten shareholders holding unlimited tradable shares
Shareholder NameShares without Trading RestrictionShare Type
Nanchang Jiangling Investment Co., Ltd.354,176,000A share
Ford Motor Company276,228,394B share
Hong Kong Securities Clearing Company Ltd. (HKSCC)34,213,828A share
Shanghai Automotive Co., Ltd.13,019,610A share
Jin Xing7,546,100B share
Invesco Great Wall New energy industry equity securities investment fund3,984,400A share
Li Yifeng2,930,900B share
Jin Shiya2,343,512B share
Taikang Life Insurance Co., Ltd.- investment linked insurance -Industry Configuration2,302,600A share
GAOLING FUND, L.P.1,793,693B share
The top 10 shareholders to sell circulated shares, and the infinite tradable relationship between shareholders and top 10 shareholders or concerted actionShareholders holding more than 5% are not related.
Description of Shareholders Participating in Financing and Securities Financing BusinessNone.

Participation of top ten shareholders in the lending of shares in the refinancingbusiness

□Applicable ?Not Applicable

Change in the top ten shareholders from the previous period due to therefinancing business

□Applicable ?Not Applicable

Stock buy-back by top ten shareholders or top ten shareholders holding unlimitedtradable shares in the reporting period

□Applicable ?Not Applicable

The top 10 common shareholders of the Company and the top 10 commonshareholders with unlimited conditions of sale did not conduct agreed repurchasetransactions during the reporting period.

II. Controlling ShareholdersNature of controlling shareholders: Central/Local government holdings, foreign

holdingsType: Legal person

NameLegal representativeEstablished DateOrganization codeMain scope of business
Nanchang Jiangling Investment Co., Ltd.Qiu TiangaoMay 28, 201991360125MA38LUR91Finvestment management, industrial investment, asset management and other business.
Ford Motor CompanyWilliam Clay Ford, Jr.January 1, 1903to design, manufacture, market, and service a full line of Ford cars, trucks, sport utility vehicles (“SUVs”), electrified vehicles, and Lincoln luxury vehicles, provide financial services through Ford Motor Credit Company LLC, and be pursuing leadership positions in electrification, autonomous vehicles, and mobility solutions.
Equity status of other listed companies in domestic and aboard market controlled and participated by the controlling shareholders during the reporting periodNone

Change of controlling shareholders

□Applicable ?Not Applicable

The controlling shareholders of the Company did not change during the reportingperiod.

III. Actual Controlling PartiesNature of controlling shareholders: Central/Local State-owned Assets Supervision

and AdministrationType: Legal person

NameLegal representativeEstablished DateOrganization codeMain scope of business
JMCGQiu TiangaoJuly 27, 199191360000158263759Rmanufacturing of automobiles, engines, chassis, specialty vehicle, transmission, other products, automotive quality testing, sales of self-produced products and raw materials, equipment, electronic products, parts and others, as well as related after-sales services and maintenance services; development of products derived from JMC brand light vehicle; overseas auto project-contracting, export equipment, material and related labour services.
Chongqing Changan Automobile Co., Ltd.Zhu HuarongOctober 31, 19969150000020286320X6development, manufacturing, sales, import & export business of auto (including sedan), engine, automotive components, die, tools, installation of machinery, technological consultant services.
Equity status of listed companies in domestic and aboard market controlled by the actual controlling parties during the reporting periodNone

Change of actual controlling parties

□Applicable ?Not Applicable

There was no change of actual controlling parties in the reporting period.

Ownership and control relations between the Company and the actual controllingparties are shown as follows:

SASAC
Nanchang State-owned Assets Supervision and Administration Committee

Chongqing Changan Automobile Co., Ltd.

Chongqing Changan Automobile Co., Ltd.

100%

100%

JMCG

JMCG

39.69%

39.69%

50%

50%50%

Nanchang Jiangling Investment Co., Ltd.

Nanchang Jiangling Investment Co., Ltd.Ford Motor Company

32%

41.03%32%

Jiangling Motors Co., Ltd.

Actual controlling parties control the Company by the way of trust or other assetsmanagement

□Applicable ?Not Applicable

IV. The cumulative number of shares pledged by the controlling shareholder or thelargest shareholder and its acting partners accounts for 80% of the number ofshares held by them.

□Applicable ?Not Applicable

V. Other legal person shareholder holding more than 10% of total equity of theCompany

□Applicable ?Not Applicable

VI Shareholding reducing restriction to controlling shareholders, actual controllingparties, restructuring parties and other commitment-making entities

□Applicable ?Not Applicable

4.The specific implementation of share repurchase during the reporting periodThe implementation progress of share repurchase

□Applicable ?Not Applicable

The implementation progress of the reduction of the shares repurchase throughcentralized bidding

□Applicable ?Not Applicable

Chapter VIII Preferred Shares

□Applicable ?Not Applicable

JMC had no preferred shares in the reporting period.

Chapter IX Bond related Information

□Applicable ?Not Applicable

Chapter X Financial Statements

Type of Audit ReportStandard and Unqualified Opinion
Signature dateMarch 28, 2024
Name of AuditorPricewaterhouseCoopers Zhong Tian LLP
Document No. of Audit ReportPwC ZT Shen Zi (2024) No. 10080

[English Translation for Reference Only]

Auditor’s Report

PwC ZT Shen Zi (2024) No. 10080

(Page 1 of 5)

To the shareholders of Jiangling Motors Corporation, Ltd.,

Opinion

What we have audited

We have audited the accompanying financial statements of Jiangling Motors Corporation, Ltd.(hereinafter “Jiangling Motors”), which comprise:

? the consolidated and company balance sheets as at 31 December 2023;? the consolidated and company income statements for the year then ended;? the consolidated and company cash flow statements for the year then ended;? the consolidated and company statements of changes in shareholder’s equity for the year

then ended; and? notes to the financial statements.

Our opinion

In our opinion, the accompanying financial statements present fairly, in all material respects, theconsolidated and company’s financial position of Jiangling Motors as at 31 December 2023 andtheir financial performance and cash flows for the year then ended in accordance with therequirements of Accounting Standards for Business Enterprises (“CASs”).

Basis for Opinion

We conducted our audit in accordance with China Standards on Auditing (“CSAs”). Ourresponsibilities under those standards are further described in the Auditor’s Responsibilities forthe Audit of the Financial Statements section of our report. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our opinion.

We are independent of Jiangling Motors in accordance with the Code of Ethics for ProfessionalAccountants of the Chinese Institute of Certified Public Accountants (“CICPA Code”), and we havefulfilled our other ethical responsibilities in accordance with the CICPA Code.

Key Audit Matter

Key audit matters are those matters that, in our professional judgment, were of most significancein our audit of the financial statements of the current period. These matters were addressed in thecontext of our audit of the financial statements as a whole, and in forming our opinion thereon,and we do not provide a separate opinion on these matters.

Key audit matter identified in our audit is expenditures on research and development.

PwC ZT Shen Zi (2024) No. 10080

(Page 2 of 5)

Key Audit Matter (Cont’d)

Key Audit MatterHow our audit addressed the Key Audit Matter
Expenditures on research and development Please refer to Note 2(14)(e), Note 4(18) and Note 4(45) to the financial statements. The amount of expenditures on research and development was RMB1,846,382,521 during the year ended 31 December 2023, of which RMB560,180,909 was capitalised. As of 31 December 2023, the balance of development expenditures amounted to RMB283,738,155. We identified the expenditures on research and development as key audit matter due to the significant amount of expenditure of research and development incurred, a portion of which being capitalised and the fact that there is significant management’s judgment involved in assessing whether the criteria of capitalisation have been met, particularly included: ? Technical feasibility of the project ? Likelihood of the generating of sufficient future economic benefits ? Timing of the capitalisationThe audit procedures we performed on expenditures on research and development included: ? We understood and evaluated the design of internal controls related to expenditures on research and development, and tested the operation effectiveness of the key controls; ? We obtained breakdown of expenditures on research and development by project and reconciled them with amounts recorded in general ledger; ? We understood the cost allocation method of research and development projects, reviewed the results of allocation of indirect expenses, and verified the reasonableness the indirect expenses attributable to relevant projects, including payrolls, depreciation and amortization expenses; ? We compared costs components across different projects and incurred research and development costs with corresponding budgets, and evaluated the progress of the different projects by interviewing with project managers on a sampling basis; ? For projects which expenditures on research and development were capitalised, we understood the criteria and timing of capitalisation determined by management; we checked the feasibility reports of different projects and interviewed with relevant project managers, reviewed the verification reports and meeting minutes at different research and development stages to further confirm the reasonableness of the judgment made by management; and we assessed the technical feasibility of the development projects and the likelihood of the generating of sufficient future economic benefits by considering market information and the Company’s successful development experience in the past; ? We tested expenditures on research and development on a sampling basis by obtaining and inspecting documents, including contracts and invoices, to verify and evaluate the relevance with research and development activities, the reality of occurrence, the accuracy of amount and the reasonableness of classification. Based on the audit procedures performed, the audit evidence we obtained supports the recognition of the expenditures on research and development and management's judgment on capitalisation of the related development expenditures.

PwC ZT Shen Zi (2024) No. 10080

(Page 3 of 5)

Other Information

Management of Jiangling Motors is responsible for the other information. The other informationcomprises all of the information included in 2023 annual report of Jiangling Motors other than thefinancial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and we do not expressany form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistent withthe financial statements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated. If, based on the work we have performed, we conclude that there is a materialmisstatement of this other information, we are required to report that fact. We have nothing toreport in this regard.

Responsibilities of Management and the Audit Committee for the Financial Statements

Management of Jiangling Motors is responsible for the preparation and fair presentation of thesefinancial statements in accordance with the CASs, and for such internal control as managementdetermines is necessary to enable the preparation of financial statements that are free from materialmisstatement, whether due to fraud or error.

In preparing these financial statements, management is responsible for assessing Jiangling Motors’sability to continue as a going concern, disclosing, as applicable, matters related to going concern andusing the going concern basis of accounting unless management either intend to liquidate JianglingMotors or to cease operations, or have no realistic alternative but to do so.

The Audit Committee is responsible for overseeing Jiangling Motors’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether these financial statements as awhole are free from material misstatement, whether due to fraud or error, and to issue an auditor’sreport that includes our opinion. Reasonable assurance is a high level of assurance, but is not aguarantee that an audit conducted in accordance with CSAs will always detect a materialmisstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these financial statements.

PwC ZT Shen Zi (2024) No. 10080

(Page 4 of 5)

Auditor’s Responsibilities for the Audit of the Financial Statements(Cont’d)

As part of an audit in accordance with CSAs, we exercise professional judgment and maintainprofessional scepticism throughout the audit. We also:

? Identify and assess the risks of material misstatement of the financial statements, whether

due to fraud or error, design and perform audit procedures responsive to those risks, andobtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.The risk of not detecting a material misstatement resulting from fraud is higher than for oneresulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.

? Obtain an understanding of internal control relevant to the audit in order to design audit

procedures that are appropriate in the circumstances.

? Evaluate the appropriateness of accounting policies used and the reasonableness of

accounting estimates and related disclosures made by management.

? Conclude on the appropriateness of management’s use of the going concern basis ofaccounting and, based on the audit evidence obtained, whether a material uncertainty existsrelated to events or conditions that may cast significant doubt on Jiangling Motors’s abilityto continue as a going concern. If we conclude that a material uncertainty exists, we arerequired to draw attention in our auditor’s report to the related disclosures in these financialstatements or, if such disclosures are inadequate, to modify our opinion. Our conclusions arebased on the audit evidence obtained up to the date of our auditor’s report. However, futureevents or conditions may cause Jiangling Motors to cease to continue as a going concern.

? Evaluate the overall presentation (including the disclosures), structure and content of the

financial statements, and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.

? Obtain sufficient appropriate audit evidence regarding the financial information of theentities or business activities within Jiangling Motors to express an opinion on the financialstatements. We are responsible for the direction, supervision and performance of the groupaudit. We remain solely responsible for our audit opinion.

We communicate with the Audit Committee regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internalcontrol that we identify during our audit.

We also provide the Audit Committee with a statement that we have complied with relevant ethicalrequirements regarding independence, and to communicate with them all relationships and othermatters that may reasonably be thought to bear on our independence, and where applicable, relatedsafeguards.

PwC ZT Shen Zi (2024) No. 10080

(Page 5 of 5)

Auditor’s Responsibilities for the Audit of the Financial Statements (Cont’d)

From the matters communicated with the Audit Committee, we determine those matters that were ofmost significance in the audit of the financial statements of the current period and are therefore thekey audit matters. We describe these matters in our auditor’s report unless law or regulationprecludes public disclosure about the matter or when, in extremely rare circumstances, we determinethat a matter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of such communication.

PricewaterhouseCoopers Zhong Tian LLP Shanghai, the People’s Republic of China 28 March 2024Signing CPA Signing CPA—————————— Ye Jun (Engagement Partner) —————————— Xiao Minjie

CONSOLIDATED FINANCIAL STATEMENTS ANDREPORT OF THE AUDITORS

31 DECEMBER 2023

JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED AND COMPANY BALANCE SHEETS AS AT 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)

AssetsNotes31 December 2023 Consolidated31 December 2022 Consolidated31 December 2023 Company31 December 2022 Company
Current assets
Cash and cash equivalents4(1)11,830,560,6758,604,977,7258,697,182,4606,910,646,428
Financial assets held for trading4(2)200,604,877---
Derivative financial assets4(3)-2,972,698-2,972,698
Notes receivable4(4)14,621,337742,752,730700,000,0001,099,742,888
Accounts receivable4(5)、14(1)4,401,826,0224,245,541,7524,594,376,1602,368,898,327
Financing receivables4(6)123,170,062376,662,81717,979,57856,868,760
Advances to suppliers4(7)204,358,759277,743,526204,358,759277,278,672
Other receivables4(8)、14(2)75,319,848111,063,37271,813,906128,855,851
Inventories4(9)1,560,259,5112,129,040,8201,558,685,5262,129,040,820
Current portion of non-current assets4(11)15,749,80613,851,63414,495,73613,851,634
Other current assets4(10)951,659,5561,362,502,624731,819,0051,310,164,197
Total current assets19,378,130,45317,867,109,69816,590,711,13014,298,320,275
Non-current assets
Long-term receivables4(12)22,775,69631,148,04416,699,34831,148,044
Long-term equity investments4(13)、14(3)233,798,348248,482,822786,452,2781,146,033,812
Fixed assets4(14)5,389,645,1525,446,384,3695,176,956,6984,961,529,936
Construction in progress4(15)464,431,412718,612,190438,083,465688,385,553
Right-of-use assets4(16)194,836,028233,622,890183,725,741232,666,362
Intangible assets4(17)1,691,021,1211,195,005,7521,469,907,538971,966,227
Development expenditures4(18)283,738,155477,233,877283,738,155477,233,877
Goodwill4(21)----
Deferred tax assets4(19)1,472,003,5541,250,722,193185,190,368235,320,874
Other non-current assets4(20)10,807,967-10,807,967-
Total non-current assets9,763,057,4339,601,212,1378,551,561,5588,744,284,685
TOTAL ASSETS29,141,187,88627,468,321,83525,142,272,68823,042,604,960

JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED AND COMPANY BALANCE SHEETS (CONT'D) AS AT 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated))

Liabilities and equityNotes31 December 2023 Consolidated31 December 2022 Consolidated31 December 2023 Company31 December 2022 Company
Current liabilities
Short-term borrowings4(22)1,300,000,0001,100,000,0001,300,000,0001,100,000,000
Derivative financial liabilities4(3)459,306-459,306-
Accounts payable4(23)9,476,215,2239,015,978,3549,475,904,2329,015,584,820
Contract liabilities4(24)243,740,992152,065,02529,190,9151,011,195
Employee benefits payable4(25)890,051,287915,703,680788,409,476824,364,157
Taxes payable4(26)118,399,765193,249,60497,718,547110,894,972
Other payables4(27)5,944,976,0935,672,708,5112,377,082,5772,418,186,421
Current portion of non-current liabilities4(28)93,383,89872,680,75686,713,25871,491,054
Other current liabilities4(29)373,948,630386,889,54236,085,60129,814,619
Total current liabilities18,441,175,19417,509,275,47214,191,563,91213,571,347,238
Non-current liabilities
Long-term borrowings4(30)1,391,41420,858,0571,391,41420,858,057
Lease liabilities4(31)138,005,943193,090,351134,081,724192,887,339
Provisions4(32)315,700,263250,762,589--
Deferred income4(33)67,601,36160,849,64367,601,36160,849,643
Long-term employee benefits payable4(34)52,891,00051,293,00052,562,00051,067,000
Deferred tax liabilities4(19)19,256,89023,305,359--
Other non-current liabilities4(35)120,293,201118,240,580--
Total non-current liabilities715,140,072718,399,579255,636,499325,662,039
Total liabilities19,156,315,26618,227,675,05114,447,200,41113,897,009,277
Equity
Share capital4(36)863,214,000863,214,000863,214,000863,214,000
Capital surplus4(37)839,442,490839,442,490839,442,490839,442,490
Other comprehensive income4(38)(20,572,000)(13,484,250)(20,979,000)(13,844,250)
Special reserve3,821,625-3,821,625-
Surplus reserve4(39)431,607,000431,607,000431,607,000431,607,000
Retained earnings4(40)8,232,632,6237,123,038,0938,577,966,1627,025,176,443
Total equity attributable to shareholders of the Company10,350,145,7389,243,817,33310,695,072,2779,145,595,683
Minority interests(365,273,118)(3,170,549)--
Total equity9,984,872,6209,240,646,78410,695,072,2779,145,595,683
TOTAL LIABILITIES AND EQUITY29,141,187,88627,468,321,83525,142,272,68823,042,604,960

Legal representative:Qiu Tiangao CFO:Joey Zhu Finance Department:Hu Hanfeng

JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED AND COMPANY INCOME STATEMENTS FOR THE YEAR ENDED 31DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)

ItemNotes2023 Consolidated2022 Consolidated2023 Company2022 Company
Revenue4(41)、14(4)33,167,325,08130,100,283,84232,573,697,82128,100,997,449
Less: Cost of sales4(41)、4(47)、14(4)(28,065,528,223)(25,812,264,868)(27,518,938,281)(25,020,438,748)
Taxes and surcharges4(42)(974,171,328)(951,394,115)(936,086,314)(919,835,457)
Selling and distribution expenses4(43)、4(47)(1,466,692,447)(1,444,894,711)(144,390,059)(171,729,499)
General and administrative expenses4(44)、4(47)(983,458,031)(964,786,345)(899,692,892)(875,592,926)
Research and development expenses4(18)、4(45)、4(47)(1,286,201,612)(1,483,329,630)(1,286,201,612)(1,483,329,630)
Financial expenses4(46)204,908,754163,907,346149,679,267108,526,076
Including: Interest expenses(41,844,790)(49,305,209)(36,373,400)(49,225,042)
Interest income251,052,563236,308,959189,389,569180,329,362
Add: Other income4(50)567,529,766943,326,556563,577,455942,054,079
Investment income4(51)、14(5)(10,579,046)(36,082,647)(17,317,710)(35,294,097)
Including: Share of profit of associates and joint ventures(9,591,118)(8,768,433)(9,591,118)(8,768,433)
Gains on changes in fair value4(52)(2,827,127)13,434,988(3,432,004)13,677,317
Credit impairment losses4(49)(5,964,483)(12,066,846)(4,170,386)5,631,231
Asset impairment losses4(48)(345,125,558)(7,242,768)(509,025,850)(7,242,768)
Gains on disposal of assets4(53)(3,908,476)391,369,117(4,425,983)391,709,115
Operating profit795,307,270900,259,9191,963,273,4521,049,132,142
Add: Non-operating income4(54)8,875,8803,788,2687,026,529383,365
Less: Non-operating expenses4(55)(6,041,023)(4,481,962)(5,991,770)(4,455,773)
Total profit798,142,127899,566,2251,964,308,2111,045,059,734
Less: Income tax expenses4(56)266,352,570(36,687,606)(45,515,756)(49,560,101)
Net profit1,064,494,697862,878,6191,918,792,455995,499,633
Classified by continuity of operations
Net profit from continuing operations1,064,494,697862,878,6191,918,792,455995,499,633
Net profit from discontinued operations----
Classified by ownership of the equity
Minority interests(411,102,569)(52,170,549)--
Attributable to shareholders of the Company1,475,597,266915,049,1681,918,792,455995,499,633
Other comprehensive income, net of tax(7,087,750)2,938,500(7,134,750)2,840,250
Attributable to shareholders of the Company
Other comprehensive income items which will not be reclassified to profit or loss
Changes arising from remeasurement of defined benefit plan4(38)(7,087,750)2,938,500(7,134,750)2,840,250
Attributable to minority interests----
Total comprehensive income1,057,406,947865,817,1191,911,657,705998,339,883
Attributable to shareholders of the Company1,468,509,516917,987,6681,911,657,705998,339,883
Attributable to minority interests(411,102,569)(52,170,549)--
Earnings per share
Basic earnings per share (RMB Yuan)4(57)1.711.06————
Diluted earnings per share (RMB Yuan)4(57)1.711.06————

Legal representative:Qiu Tiangao CFO:Joey Zhu Finance Department:Hu Hanfeng

JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS FOR THE YEAR ENDED31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)

ItemNotes2023 Consolidated2022 Consolidated2023 Company2022 Company
Cash flows generated from/(uesd in) operating activities
Cash received from sales of goods or rendering of services37,150,759,55030,379,935,54233,349,485,19128,500,883,020
Refunds of taxes658,837,860186,230,096658,837,860139,724,259
Cash received relating to other operating activities4(58)653,090,5521,048,761,411616,538,1381,012,041,891
Sub-total of cash inflows38,462,687,96231,614,927,04934,624,861,18929,652,649,170
Cash paid for goods and services(26,547,151,493)(26,012,469,683)(25,829,707,895)(25,251,565,747)
Cash paid to and on behalf of employees(2,564,423,876)(2,236,265,303)(2,361,423,689)(2,042,877,671)
Payments of taxes and surcharges(2,252,941,361)(2,208,513,599)(1,937,323,927)(1,895,305,960)
Cash paid relating to other operating activities4(58)(2,530,631,366)(2,676,252,416)(1,395,818,726)(1,545,847,293)
Sub-total of cash outflows(33,895,148,096)(33,133,501,001)(31,524,274,237)(30,735,596,671)
Net cash flows generated from/(uesd in) operating activities4(59)4,567,539,866(1,518,573,952)3,100,586,952(1,082,947,501)
Cash flows uesd in investing activities
Cash received from disposal of investments4(58)300,000,000200,000,000--
Cash received from returns on investments7,215,5481,523,8365,093,356-
Net cash received from disposal of fixed assets, intangible assets and other long-term assets2,193,226783,318,0542,920,918782,994,506
Cash received from disposal of subsidiaries and other business units60,900,000191,100,00060,900,000191,100,000
Cash received relating to other investing activities4(58)254,122,532231,280,443193,082,627181,238,794
Sub-total of cash inflows624,431,3061,407,222,333261,996,9011,155,333,300
Cash paid to acquire fixed assets, intangible assets and other long-term assets(1,296,500,813)(1,380,537,113)(1,295,937,393)(1,377,197,659)
Cash paid to acquire investments4(58)(500,000,000)(100,000,000)(53,167,203)(55,924,647)
Cash paid relating to other investing activities(88,707)(15,828,699)(88,707)(15,828,699)
Sub-total of cash outflows(1,796,589,520)(1,496,365,812)(1,349,193,303)(1,448,951,005)
Net cash flows uesd in from investing activities(1,172,158,214)(89,143,479)(1,087,196,402)(293,617,705)
Cash flows (uesd in)/generated from financing activities
Cash received from absorbing investments49,000,00049,000,000--
Including: cash received by the subsidiary from absorbing minority shareholders' investment49,000,00049,000,000--
Cash received from borrowings4,278,854,8334,682,667,6613,583,941,0564,682,667,661
Cash received from other financing activities700,000,000---
Sub-total of cash inflows5,027,854,8334,731,667,6613,583,941,0564,682,667,661
Cash repayments of borrowings(4,106,648,284)(3,900,441,579)(3,406,648,284)(3,900,441,579)
Cash payments for distribution of dividends, profits or interest expenses(377,731,962)(230,386,002)(377,731,962)(230,386,002)
Cash paid relating to other financing activities4(58)(735,531,278)(18,980,309)(27,737,455)(17,978,248)
Sub-total of cash outflows(5,219,911,524)(4,149,807,890)(3,812,117,701)(4,148,805,829)
Net cash flows (uesd in)/generated from financing activities(192,056,691)581,859,771(228,176,645)533,861,832
Effect of foreign exchange rate changes on cash and cash equivalents----
Net increase/(decrease) in cash and cash equivalents4(59)3,203,324,961(1,025,857,660)1,785,213,905(842,703,374)
Add: Cash and cash equivalents at beginning of year4(59)8,543,193,6549,569,051,3146,863,577,3377,706,280,711
Cash and cash equivalents at end of year4(59)11,746,518,6158,543,193,6548,648,791,2426,863,577,337

Legal representative:Qiu Tiangao CFO:Joey Zhu Finance Department:Hu Hanfeng

JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED STATEMENT OF CHANGES IN EQUITY(All amounts in RMB Yuan unless otherwise stated)

2023

ItemNotesAttributable to shareholders of the parent companyMinority interestsTotal equity
Share capitalCapital surplusOther comprehensive incomeSpecial reserveSurplus reserveRetained earnings
Balance at 1 January 2023863,214,000839,442,490(13,484,250)-431,607,0007,123,038,093(3,170,549)9,240,646,784
Movements for the year ended 31 December 2023--(7,087,750)3,821,625-1,109,594,530(362,102,569)744,225,836
Total comprehensive income
Net profit/(loss)-----1,475,597,266(411,102,569)1,064,494,697
Other comprehensive income--(7,087,750)----(7,087,750)
Total comprehensive income for the year--(7,087,750)--1,475,597,266(411,102,569)1,057,406,947
Capital contributed by owners and capital decreases
Capital invested by shareholders------49,000,00049,000,000
Profit distribution
Distribution to shareholders4(40)-----(366,002,736)-(366,002,736)
Special reserve
Withdrawal this year---29,300,742---29,300,742
Used this year---(25,479,117)---(25,479,117)
Balance at 31 December 2023863,214,000839,442,490(20,572,000)3,821,625431,607,0008,232,632,623(365,273,118)9,984,872,620

JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONT’D)(All amounts in RMB Yuan unless otherwise stated)

2022

ItemNotesAttributable to shareholders of the parent companyMinority interestsTotal equity
Share capitalCapital surplusOther comprehensive incomeSurplus reserveRetained earnings
Balance at 1 January 2022863,214,000839,442,490(16,422,750)431,607,0006,437,603,849-8,555,444,589
Movements for the year ended 31 December 2022--2,938,500-685,434,244(3,170,549)685,202,195
Total comprehensive income
Net profit/(loss)----915,049,168(52,170,549)862,878,619
Other comprehensive income--2,938,500---2,938,500
Total comprehensive income for the year--2,938,500-915,049,168(52,170,549)865,817,119
Capital contributed by owners and capital decreases
Capital invested by shareholders-----49,000,00049,000,000
Profit distribution
Distribution to shareholders4(40)----(229,614,924)-(229,614,924)
Balance at 31 December 2022863,214,000839,442,490(13,484,250)431,607,0007,123,038,093(3,170,549)9,240,646,784

Legal representative:Qiu Tiangao CFO:Joey Zhu Finance Department:Hu Hanfeng

JIANGLING MOTORS CORPORATION, LTD.COMPANY STATEMENT OF CHANGES IN EQUITY(All amounts in RMB unless otherwise stated)

2023

ItemNotesShare capitalCapital surplusOther comprehensive incomeSpecial reserveSurplus reserveRetained earningsTotal equity
Balance at 1 January 2023863,214,000839,442,490(13,844,250)-431,607,0007,025,176,4439,145,595,683
Movements for the year ended 31 December 2023--(7,134,750)3,821,625-1,552,789,7191,549,476,594
Total comprehensive income
Net profit-----1,918,792,4551,918,792,455
Other comprehensive income--(7,134,750)---(7,134,750)
Total comprehensive income for the year--(7,134,750)--1,918,792,4551,911,657,705
Profit distribution
Distribution to shareholders4(40)-----(366,002,736)(366,002,736)
Special reserve
Withdrawal this year---29,300,742--29,300,742
Used this year---(25,479,117)--(25,479,117)
Balance at 31 December 2023863,214,000839,442,490(20,979,000)3,821,625431,607,0008,577,966,16210,695,072,277

JIANGLING MOTORS CORPORATION, LTD.COMPANY STATEMENT OF CHANGES IN EQUITY(All amounts in RMB unless otherwise stated)

2022

ItemNotesShare capitalCapital surplusOther comprehensive incomeSurplus reserveRetained earningsTotal equity
Balance at 1 January 2022863,214,000839,442,490(16,684,500)431,607,0006,259,291,7348,376,870,724
Movements for the year ended 31 December 2022--2,840,250-765,884,709768,724,959
Total comprehensive income
Net profit----995,499,633995,499,633
Other comprehensive income--2,840,250--2,840,250
Total comprehensive income for the year--2,840,250-995,499,633998,339,883
Profit distribution
Distribution to shareholders4(40)----(229,614,924)(229,614,924)
Balance at 31 December 2022863,214,000839,442,490(13,844,250)431,607,0007,025,176,4439,145,595,683

Legal representative:Qiu Tiangao CFO:Joey Zhu Finance Department:Hu Hanfeng

FINANCIAL STATEMENTS ANDAUDITOR'S REPORTFOR THE YEAR ENDED 31 DECEMBER 2023

[English translation for reference only. Should there be any inconsistency between theChinese and English versions, the Chinese version shall prevail.]

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

1General information
Jiangling Motors Corporation, Ltd. (hereinafter “the Company”) is a Sino-foreign joint stock enterprise established under the approval of Hong ban (1992) No. 005 of Nanchang Revolution and Authorisation Group of Company’s Joint Stock on the basis of Jiangxi Motors Manufacturing Factory on 16 June 1992. The registration number of the enterprise business license is No. 913600006124469438. The registered address of the Company and the address of its headquarters are both Nanchang City, Jiangxi Province of the People’s Republic of China (“the PRC”).
On 23 July 1993, with the approval of the China Securities Regulatory Commission (hereinafter “CSRC”) (Zheng Jian Fa Shen Zi [1993] No. 22) and (Zheng Jian Han Zi [1993] No. 86), the Company was listed on the Stock Exchange of Shenzhen on 1 December 1993, issuing 494,000,000 shares in total. On 8 April 1994, a total of 25,214,000 shares were distributed for the 1993 dividend distribution programme with the approval of the shareholders’ meeting and Jiangxi Securities Management Leading Group (Gan Securities [1994] No. 02). In 1995, with the approval of CSRC (Zheng Jian Fa Zi [1995] No. 144) and the Shenzhen Securities Management Office (Shenzhen Office Fu [1995] No. 92), the Company issued 174,000,000 ordinary shares (“B shares”). In 1998, with the approval of CSRC (Zheng Jian Fa Zi [1998] No. 19), the Company issued additional 170,000,000 B shares.
According to the resolution of the shareholders’ meeting regarding the split share structure reform on 11 January 2006, the Company implemented the Scheme on Split Share Structure Reform on 13 February 2006. After the implementation, the Company’s total paid-in capital remains the same. Related details are disclosed in Note 4(36).
As at 31 December 2023, the Company’s paid-in capital totalled RMB863,214,000, with par value of RMB1 per share.
The actual principal business scope of the Company and its subsidiaries (hereinafter “the Group”) includes production and sales of automobile assemblies such as automobiles, special (modified) vehicles, engines and chassis and other automobile parts, and provision of related after-sales services; retail and wholesale of imported FORD E series automobiles of Ford Motor (China) Co., Ltd. as the dealer; import and export of automobiles and parts; dealership of used cars; provision of enterprise management and consulting services related to production and sales of automobiles.
Subsidiaries included in the consolidation scope for the current year are detailed in Note 5.
These financial statements were authorised for issue by the Company's Board of Directors on 28 March 2024.
2Summary of significant accounting policies and accounting estimates
The Group determines specific accounting policies and estimates based on the features of its production and operation, which mainly comprise the measurement of expected credit losses (“ECL”) on receivables (Note 2(8)), valuation of inventories (Note 2(9)), depreciation of fixed assets and amortisation of intangible assets and right-of-use assets (Note 2(11), (14), (22)), criteria for capitalisation of development expenditures (Note 2(14)), impairment of long-term assets (Note2(15)), recognition and measurement of revenue (Note 2(19)), government subsidies (Note2(20)), etc. Key judgements and critical accounting estimates and key assumptions applied by the Group on the determination of significant accounting policies are set out in Note 2(25).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(1)Basis of preparation
The financial statements are prepared in accordance with the Accounting Standard for Business Enterprises - Basic Standard, specific accounting standards and relevant regulations issued by the Ministry of Finance on 15 February 2006 and in subsequent periods (hereinafter collectively referred to as “the Accounting Standards for Business Enterprises” or “CASs”) and the disclosure requirements in the Preparation Convention of Information Disclosure by Companies Offering Securities to the Public No.15 - General Rules on Financial Reporting issued by CSRC. These financial statements have been prepared on a going concern basis.
(2)Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements of the Company for the year ended 31 December 2023 are in compliance with the Accounting Standards for Business Enterprises, and truly and completely present the consolidated and company’s financial position of the Company as at 31 December 2023 and their financial performance, cash flows and other information for the year then ended.
(3)Fiscal year
The Company’s fiscal year starts on 1 January and ends on 31 December.
(4)Recording currency
The recording currency of the Company and its subsidiaries is Renminbi (“RMB”). The financial statements are presented in RMB.
(5)Preparation of consolidated financial statements
The consolidated financial statements comprise the financial statements of the Company and all of its subsidiaries.
Subsidiaries are consolidated from the date on which the Group obtains control and are de-consolidated from the date that such control ceases. For a subsidiary that is acquired in a business combination involving enterprises under common control, it is included in the consolidated financial statements from the date when it, together with the Company, comes under common control of the ultimate controlling party. The portion of the net profits realised before the combination date is presented separately in the consolidated income statement.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(5)Preparation of consolidated financial statements (Cont’d)
In preparing the consolidated financial statements, where the accounting policies or the accounting periods of the Company and subsidiaries are inconsistent, the financial statements of the subsidiaries are adjusted in accordance with the accounting policies and the accounting period of the Company. For subsidiaries acquired from business combinations involving enterprises not under common control, the individual financial statements of the subsidiaries are adjusted based on the fair value of the identifiable net assets at the acquisition date.
All significant intra-group balances, transactions and unrealised profits are eliminated in the consolidated financial statements. The portion of subsidiaries’ shareholders' equity and the portion of subsidiaries’ net profits and losses and comprehensive income for the period not attributable to the Company are recognised as minority interests, net profit attributed to minority interests and total comprehensive income attributed to minority interests and presented separately in the consolidated financial statements under shareholders' equity, net profits and total comprehensive income respectively. If the subsidiaries’ loss for the current period attributed to the minority shareholders exceeds their share in the opening shareholder’s equity, the excess will be deducted against the minority interests. Unrealised profits and losses resulting from the sales of assets by the Company to its subsidiaries are fully eliminated against net profit attributable to owners of the parent. Unrealised profits and losses resulting from the sales of assets by a subsidiary to the Company are eliminated and allocated between net profit attributable to owners of the parent and net profit attributed to minority interests in accordance with the allocation proportion of the parent in the subsidiary. Unrealised profits and losses resulting from the sales of assets by one subsidiary to another are eliminated and allocated between net profit attributable to owners of the parent and net profit attributed to minority interests in accordance with the allocation proportion of the parent in the subsidiary. If the accounting treatment of a transaction is inconsistent in the financial statements at the Group level and at the Company or its subsidiary level, adjustment will be made from the perspective of the Group.
The Group remeasure the remaining investment held at its fair value in the consolidated statement of financial position when the control is lost because of the partially disposal of the equity or other reasons. The difference between the consideration of the disposal as well as the fair value of the remaining investment and the share of net assets of the former subsidiary calculated based on the original share since the acquisition date as well as the good will is recognised in investment income in the period of control lost. In addition, the other comprehensive income and other changes in owner's equity related to the investment of the former subsidiary, are reclassified to profit or loss when the control is lost, except for the changes arising from remeasurement of net liabilities or net assets of defined benefit, the accumulated changes in fair value from the equity instruments not held for trading and designated as financial assets at fair value through other comprehensive income by the investee.
(6)Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, deposits that can be readily drawn on demand, and short-term and highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(7)Foreign currency translation
Foreign currency transactions
Foreign currency transactions are translated into recording currency using the exchange rates prevailing at the dates of the transactions.
At the balance sheet date, monetary items denominated in foreign currencies are translated into recording currency using the spot exchange rates on the balance sheet date. Exchange differences arising from these translations are recognised in profit or loss for the current period, except for those attributable to foreign currency borrowings that have been taken out specifically for acquisition or construction of qualifying assets, which are capitalised as part of the cost of those assets. Non-monetary items denominated in foreign currencies that are measured at historical costs are translated at the balance sheet date using the spot exchange rates at the date of the transactions. The effect of exchange rate changes on cash is presented separately in the cash flow statement.
(8)Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. A financial asset or a financial liability is recognised when the Group becomes a party to the contractual provisions of the instrument.
(a)Financial assets
(i)Classification and measurement
Based on the business model for managing the financial assets and the contractual cash flow characteristics of the financial assets, financial assets are classified as: (1) financial assets at amortised cost; (2) financial assets at fair value through other comprehensive income; (3) financial assets at fair value through profit or loss.
The financial assets are measured at fair value at initial recognition. Related transaction costs that are attributable to the acquisition of the financial assets are included in the initially recognised amounts, except for the financial assets at fair value through profit or loss, the related transaction costs of which are recognised directly in profit or loss for the current period. Accounts receivable or notes receivable arising from sales of products or rendering of services (excluding or without regard to significant financing components) are initially recognised at the consideration that is entitled to be charged by the Group as expected.
Debt instruments
The debt instruments held by the Group refer to the instruments that meet the definition of financial liabilities from the perspective of the issuer, and are measured in the following three ways:

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

Measured at amortised cost:
The objective of the Group’s business model is to hold the financial assets to collect the contractual cash flows, and the contractual cash flow characteristics are consistent with a basic lending arrangement, which gives rise on specified dates to the contractual cash flows that are solely payments of principal and interest on the principal amount outstanding. The interest income of such financial assets is recognised using the effective interest method. Such financial assets mainly include cash at bank and on hand, notes receivable, accounts receivable, other receivables and long-term receivables, etc. The Group presents long-term receivables that are due within one year from the balance sheet date (including one year) as non-current assets due within one year.
Measured at fair value through other comprehensive income:
The objective of the Group’s business model is to hold the financial assets to both collect the contractual cash flows and sell such financial assets, and the contractual cash flow characteristics are consistent with a basic lending arrangement. Such financial assets are measured at fair value through other comprehensive income, except for the impairment gains or losses, foreign exchange gains and losses, and interest income calculated using the effective interest method which are recognised in profit or loss for the current period. Such financial assets mainly include financing receivables, etc.
Measured at fair value through profit or loss:
Debt instruments held by the Group that are not divided into those at amortised cost, or those measured at fair value through other comprehensive income, are measured at fair value through profit or loss. At initial recognition, the Group does not designate a portion of financial assets as at fair value through profit or loss to eliminate or significantly reduce an accounting mismatch. Financial assets that are due in more than one year as from the balance sheet date and are expected to be held for over one year are included in other non-current financial assets, and the others are included in financial assets held for trading.
2Summary of significant accounting policies and accounting estimates (Cont’d)
(8)Financial instruments (Cont’d)
(a)Financial assets (Cont’d)
(i)Classification and measurement (Cont’d)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(8)Financial instruments (Cont’d)
(a)Financial assets (Cont’d)
(ii)Impairment
Loss provision for financial assets at amortised cost and receivables financing at fair value through other comprehensive income is recognised on the basis of ECL.
Giving consideration to reasonable and supportable information that is related to past events, current conditions and forecasts of future economic conditions and is available without undue cost or effort at the balance sheet date, as well as the default risk weight, the Group recognises the ECL as the probability-weighted amount of the present value of the difference between the cash flows receivable from the contract and the cash flows expected to collect.
For notes receivable, accounts receivable and financing receivables arising from sales of goods and rendering of services in the ordinary course of operating activities, the Group recognises the lifetime ECL regardless of whether there exists a significant financing component.
Except for the above-mentioned notes receivable, accounts receivable and financing receivables, as at each balance sheet date, the ECL of financial instruments at different stages are measured respectively. 12-month ECL provision is recognised for financial instruments in Stage 1 that have not had a significant increase in credit risk since initial recognition; lifetime ECL provision is recognised for financial instruments in Stage 2 that have had a significant increase in credit risk yet without credit impairment since initial recognition; and lifetime ECL provision is recognised for financial instruments in Stage 3 that have had credit impairment since initial recognition.
For the financial instruments with low credit risk on the balance sheet date, the Group assumes there is no significant increase in credit risk and identifies it in Stage 1 since initial recognition and recognises the 12-month ECL provision.
For the financial instruments in Stage 1 and Stage 2, the Group calculates the interest income by applying the effective interest rate to the gross carrying amount (before deduction of the impairment provision). For the financial instrument in Stage 3, the interest income is calculated by applying the effective interest rate to the amortised cost (after deduction of the impairment provision from the gross carrying amount).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(8)Financial instruments (Cont’d)
(a)Financial assets (Cont’d)
(ii)Impairment (Cont’d)
The credit risk characteristics of various financial assets where the ECL is calculated individually are significantly different from those of other financial assets in this category. In case the ECL of an individually assessed financial asset cannot be evaluated with reasonable cost, the Group divides the receivables into certain groupings based on credit risk characteristics and calculates the ECL for the groupings. Basis for determining groupings and related provision methods are as follows:
Grouping - Bank acceptance notesState-owned banks and joint stock banks
Grouping - Trade acceptance notesCustomers purchasing using trade acceptance notes
Grouping - Sales of general automobiles i)Customers of general automobiles, with the aging calculated from the overdue date
Grouping - Domestic sales of general automobiles i)Domestic customers of general automobiles, with the aging calculated from the overdue date
Grouping - Export sales of general automobiles i)Overseas customers of export general automobiles, with the aging calculated from the overdue date
Grouping - Sales of new energy automobilesCustomers of new energy automobiles, with the aging calculated from the overdue date
Grouping - Sales of automobile partsCustomers of automobile parts, with the aging calculated from the overdue date
Grouping - Other receivablesOther receivables with the same nature
i) In 2023, the Group splitted the Sales of general automobiles grouping into the Domestic sales of general automobiles grouping and the Export sales of general automobiles grouping based on changes in business policies.
For accounts receivable classified as a portfolio and notes receivable and financing receivables resulting from daily operating activities such as sale of goods and provision of services, the Group calculates the ECL with reference to historical credit losses experience, current conditions and forecasts of future economic conditions, and based on the exposure at default and the lifetime ECL rate. For other notes receivable, financing receivables and other receivables classified into groupings, the Group calculates the ECL with reference to the historical credit loss experience, current conditions and forecasts of future economic conditions, and based on the exposure at default and the 12-month or lifetime ECL rate.
The Group recognises the loss provision made or reversed into profit or loss for the current period. For debt instruments held at fair value through other comprehensive income, the Group adjusts other comprehensive income while the impairment loss or gain is recognised in profit or loss for the current period.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(8)Financial instruments (Cont’d)
(a)Financial assets (Cont’d)
(iii)Derecognition
A financial asset is derecognised when: (i) the contractual rights to the cash flows from the financial asset expire, (ii) the financial asset has been transferred and the Group transfers substantially all the risks and rewards of ownership of the financial asset to the transferee, or (iii) the financial asset has been transferred and the Group has not retained control of the financial asset, although the Group neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset. When a financial asset is derecognised, the difference between the carrying amount and the sum of the consideration received and the cumulative changes in fair value that are previously recognised directly in other comprehensive income is recognised in profit or loss for the current period.
(b)Financial liabilities
Financial liabilities are classified as financial liabilities at amortised cost and financial liabilities at fair value through profit or loss at initial recognition. Financial liabilities of the Group mainly comprise financial liabilities at amortised cost, including notes payable, accounts payable, other payables, borrowings, etc. Such financial liabilities are initially recognised at fair value, net of transaction costs incurred, and subsequently measured using the effective interest method. Financial liabilities that are due within one year (inclusive) are classified as current liabilities; those with maturities over one year but are due within one year (inclusive) as from the balance sheet date are classified as current portion of non-current liabilities. Others are classified as non-current liabilities.
A financial liability is derecognised or partly derecognised when the underlying present obligation is discharged or partly discharged. The difference between the carrying amount of the derecognised part of the financial liability and the consideration paid is recognised in profit or loss for the current period.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(8)Financial instruments (Cont’d)
(c)Determination of fair value of financial instruments
The fair value of a financial instrument that is traded in an active market is determined at the quoted price in the active market. The fair value of a financial instrument that is not traded in an active market is determined by using a valuation technique. In valuation, the Group adopts valuation techniques applicable in the current situation and supported by adequate available data and other information, selects inputs with the same characteristics as those of assets or liabilities considered in relevant transactions of assets or liabilities by market participants, and gives priority to the use of relevant observable inputs. When relevant observable inputs are not available or feasible, unobservable inputs are adopted.
(9)Inventories
(a)Classification
Inventories include raw materials, work-in-process, finished goods, low-value consumables, materials in transit and materials on consignment, etc., and are measured at the lower of cost or net realizable value.
(b)Costing of inventories
Cost is determined using the weighted average method. The cost of finished goods and work in progress comprise raw materials, direct labour and systematically allocated production overhead based on the normal production capacity.
(c)Basis for determining net realisable value of inventories and method for making provision for inventories
Provision for inventories is determined at the excess amount of the carrying amounts of the inventories over their net realisable value. Net realisable value is determined based on the estimated selling price in the ordinary course of business, less the estimated costs to completion, estimated contract fulfilment costs and estimated costs necessary to make the sale and related taxes. The provision for decline in the value of inventories relating to inventories that are produced and sold in the same region and with the same or similar end uses or purposes, is determined on an aggregate basis. The Group makes provision for decline in the value of inventories based on factors including sales.
(d)The Group adopts the perpetual inventory system.
(e)Amortisation method of low value consumables
Low value consumables are amortised into expenses in full when issued for use.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(10)Long-term equity investments
Long-term equity investments comprise the Company’s long-term equity investments in its subsidiaries, and the Group’s long-term equity investments in its associates.
Subsidiaries are the investees over which the Company is able to exercise control. Associates are the investees that the Group has a significant influence on their financial and operating decisions.
Investments in subsidiaries are presented using the cost method in the Company’s financial statements, and adjusted to the equity method when preparing the consolidated financial statements. Investments in associates are accounted for using the equity method.
(a)Determination of investment cost
For long-term equity investments acquired through a business combination involving enterprises under common control, the investment cost shall be the absorbing party’s share of the carrying amount of owners’ equity of the party being absorbed in the consolidated financial statements of the ultimate controlling party at the combination date; for long-term equity investments acquired through a business combination not involving enterprises under common control, the investment cost shall be the combination cost. For long-term equity investments acquired not through a business combination, such as long-term equity investments acquired by payment in cash, the initial investment cost shall be the purchase price actually paid; for long-term equity investments acquired by issuing equity securities, the initial investment cost shall be the fair value of the equity securities issued.
(b)Subsequent measurement and recognition of profit or loss
Long-term equity investments accounted for using the cost method are measured at the initial investment cost. Cash dividend or profit distribution declared by an investee is recognised as investment income into profit or loss for the current period.
For long-term equity investments accounted for using the equity method, where the initial investment cost exceeds the Group’s share of the fair value of the investee’s identifiable net assets at the time of acquisition, the investment is initially measured at that cost. Where the initial investment cost is less than the Group’s share of the fair value of the investee’s identifiable net assets at the time of acquisition, the difference is included in profit or loss for the current period and the cost of the long-term equity investment is adjusted upwards accordingly.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(10)Long-term equity investments (Cont’d)
(b)Subsequent measurement and recognition of profit or loss (Cont’d)
For long-term equity investments accounted for using the equity method, the Group recognises the investment income or losses according to its share of net profit or loss of the investee. The Group does not recognise further losses when the carrying amounts of the long-term equity investment together with any long-term interests that, in substance, form part of the Group’s net investment in investees are reduced to zero. However, if the Group has obligations for additional losses and the criteria with respect to recognition of provisions are satisfied, the Group continues recognising the investment losses and the provisions at the amount it expects to undertake. The Group’s share of the changes in investee’s owner's equity other than those arising from the net profit or loss, other comprehensive income and profit distribution is recognised in capital surplus with a corresponding adjustment to the carrying amounts of the long-term equity investment. The carrying amount of the investment is reduced by the Group’s share of the profit distribution or cash dividends declared by the investees. Unrealised gains or losses on transactions between the Group and its investees are eliminated to the extent of the Group’s equity interest in the investees, based on which the investment income or losses in the Company’s financial statements are recognised. When preparing consolidated financial statements, for the portion of unrealised gains and losses of internal transaction attributable to the Group arising from downstream transactions in which the Group invests in or sells assets to the investees, the Group shall, on the basis of offsetting the Company's financial statements, offset the portion of unrealised revenue and costs or asset disposal gains and losses attributable to the Group, and adjust investment income accordingly; for the unrealised gains and losses of internal transaction attributable to the Group arising from the upstream transactions in which the investees invest in or sell assets to the Group, the Group shall, on the basis of offsetting the Company's financial statements, offset the portion of unrealised gains and losses of internal transaction included in the carrying amount of the relevant assets, and adjust the carrying amount of long-term equity investments accordingly. Any losses resulting from transactions between the Group and its investees, which are attributable to asset impairment losses are not eliminated.
(c)Basis for determining existence of control and significant influence over investees
Control is the power over investees that can bring variable returns through involvement in related activities of investees and the ability to influence the returns by using such power over investees.
Significant influence is the power to participate in making decisions on financial and operating policies of the investee but is not control or joint control over making those policies.
(d)Impairment of long-term equity investments
The carrying amounts of long-term equity investments in subsidiaries and associates is reduced to the recoverable amounts when the recoverable amounts are below their carrying amount (Note 2(15)).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(11)Fixed assets
(a)Recognition and initial measurement of fixed assets
Fixed assets comprise buildings, machinery and equipment, vehicles, moulds, and electronic and other equipment.
Fixed assets are recognised when it is probable that the related economic benefits will flow to the Group and the costs can be reliably measured. Fixed assets purchased or constructed by the Group are initially measured at cost at the time of acquisition. The fixed assets contributed by the state-owned shareholders upon the restructuring of the Company are recorded at the valued amount determined by the state-owned asset administration department.
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed asset when it is probable that the associated economic benefits will flow to the Group and the related cost can be reliably measured. The carrying amount of the replaced part is derecognised. All the other subsequent expenditures are recognised in profit or loss for the period in which they are incurred.
(b)Depreciation methods of fixed assets
Fixed assets are depreciated using the straight-line method to allocate the cost of the assets to their estimated net residual values over their estimated useful lives. For the fixed assets that have been provided for impairment loss, the related depreciation charge is prospectively determined based upon the adjusted carrying amounts over their remaining useful lives.
The estimated useful lives, the estimated net residual values expressed as a percentage of cost and the annual depreciation rates of fixed assets are as follows:
Estimated useful livesEstimated net residual valuesAnnual depreciation rates
Buildings35 to 40 years4%2.4% to 2.7%
Machinery and equipment10 to 15 years4%6.4% to 9.6%
Vehicles2 to 10 years4% - 22.32%9.6% to 42.2%
Moulds5 years-20%
Electronic and other equipment5 to 7 years4%13.7% to 19.2%
The estimated useful life and the estimated net residual value of a fixed asset and the depreciation method applied to the asset are reviewed and adjusted as appropriate at each year-end.
(c)The carrying amount of a fixed asset is reduced to the recoverable amount when the recoverable amount is below the carrying amount (Note 2(15)).
(d)Disposal of fixed assets
A fixed asset is derecognised on disposal or when no future economic benefits are expected from its use or disposal. The amount of proceeds from disposals on sale, transfer, retirement or damage of a fixed asset net of its carrying amount and related taxes and expenses is recognised in profit or loss for the current period.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(12)Construction in progress
Construction in progress is measured at actual cost. Actual cost comprises construction costs, installation costs, borrowing costs that are eligible for capitalisation and other costs necessary to bring the construction in progress ready for their intended use. Construction in progress is transferred to fixed assets when the assets are ready for their intended use, and depreciation is charged starting from the following month. The carrying amount of construction in progress is reduced to the recoverable amount when the recoverable amount is below the carrying amount (Note 2(15)).
(13)Borrowing costs
The borrowing costs that are directly attributable to acquisition and construction of an asset that needs a substantially long period of time for its intended use commence to be capitalised and recorded as part of the cost of the asset when expenditures for the asset and borrowing costs have been incurred, and the activities relating to the acquisition and construction that are necessary to prepare the asset for its intended use have commenced. The capitalisation of borrowing costs ceases when the asset under acquisition or construction becomes ready for its intended use and the borrowing costs incurred thereafter are recognised in profit or loss for the current period. Capitalisation of borrowing costs is suspended during periods in which the acquisition or construction of an asset is interrupted abnormally and the interruption lasts for more than 3 months, until the acquisition or construction is resumed.
The capitalised amount of specific borrowings intended to be used for the acquisition and construction of qualifying assets is determined by the interest expenses incurred in the current period less interest income of the unused borrowings deposited at banks or investment income from temporary investments.
The capitalised amount of general borrowings intended to be used for the acquisition or construction of qualifying assets is determined by the weighted average of the excess of accumulated capital expenditure over capital expenditure of the special borrowings multiplied by the weighted average effective interest rate of the utilised general borrowings. The effective interest rate is the rate at which the future cash flows of the borrowings over the expected lifetime or a shorter applicable period are discounted into the initial recognised amount of the borrowings.
(14)Intangible assets
Intangible assets include land use rights, software use fees, non-patent technologies and after-sales service management mode, are measured at cost.
(a)Land use rights
Land use rights are amortised on the straight-line basis over their approved use period of 50 years. If the acquisition costs of the land use rights and the buildings located thereon cannot be reasonably allocated between the land use rights and the buildings, all of the acquisition costs are recognised as fixed assets.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(14)Intangible assets (Cont’d)
(b)Software use fees
Software use fees are amortised on a straight-line basis over the estimated useful life of 5 years.
(c)Non-patent technologies
Non-patent technologies are amortised on the straight-line basis over the estimated useful life of 5 to 7 years.
(d)Periodical review of useful life and amortisation method
For an intangible asset with a finite useful life, review of its useful life and amortisation method is performed at each year-end, with adjustment made appropriately.
(e)Research and development
The expenditure on research and development of the Group mainly include materials consumed for research and development activities, employee benefits of research and development departments, depreciation and amortisation of assets such as equipment and software used for research and development, research and development design fees and research and development testing expenses.
Expenditure on the research phase related to planned survey, evaluation and selection for research on manufacturing technique of automobile products is recognised in profit or loss in the period in which it is incurred. Prior to mass production, expenditure on the development phase related to the design and testing phase in regard to the final application of manufacturing technique of automobile products is capitalised only if all of the following conditions are satisfied: ? the development of manufacturing technique of automobile products has been fully demonstrated by technical team; ? management intends to complete the development of manufacturing technique of automobile products, and use or sell it; ? the research and analysis of preliminary market survey indicate that products manufactured with manufacturing technique of automobile products are marketable; ? adequate technical and financial supports are available for development of manufacturing techniques of automobile products and subsequent mass production; and ? expenditure on development of manufacturing techniques of automobile products can be reliably collected.
Other expenditures on the development phase that do not meet the conditions above are recognised in profit or loss in the period in which they are incurred. Development expenditures previously recognised as expenses are not recognised as an asset in a subsequent period. Capitalised expenditure on the development phase is presented as development expenditures in the balance sheet and transferred to intangible assets at the date that the asset is ready for its intended use.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(14)Intangible assets (Cont’d)
(f)Impairment of intangible assets
The carrying amounts of intangible assets are reduced to the recoverable amounts when the recoverable amounts are below their carrying amounts (Note 2(15)).
(15)Impairment of long-term assets
Fixed assets, construction in progress, right-of-use assets, intangible assets with finite useful lives and long-term equity investments in subsidiaries and associates are tested for impairment if there is any indication that the assets may be impaired at the balance sheet date; intangible assets that are not yet available for their intended use are tested for impairment at least once a year, irrespective of whether there is any indication of impairment. If the result of the impairment test indicates that the recoverable amount of an asset is less than its carrying amount, a provision for impairment and an asset impairment loss are recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less disposal costs and the present value of the future cash flows expected to be derived from the asset. Provision for asset impairment is determined and recognised on the individual asset basis. If it is not possible to estimate the recoverable amount of an individual asset, the recoverable amount of a group of assets to which the asset belongs is determined. A group of assets is the smallest group of assets that is able to generate independent cash inflows.
Goodwill that is separately presented in the financial statements is tested at least once a year for impairment, irrespective of whether there is any indication that it may be impaired. In conducting the test, the carrying amount of goodwill is allocated to the related asset group or groups of asset groups which are expected to benefit from the synergies of the business combination. If the result of the test indicates that the recoverable amount of an asset group or a group of asset groups, including the allocated goodwill, is lower than its carrying amount, the corresponding impairment loss is recognised. The impairment loss is first deducted from the carrying amount of goodwill that is allocated to the asset group or group of asset groups, and then deducted from the carrying amounts of other assets within the asset group or group of asset groups in proportion to the carrying amounts of assets other than goodwill.
Once the above asset impairment loss is recognised, it will not be reversed for the value recovered in the subsequent periods.
(16)Employee benefits
Employee benefits refer to all forms of consideration or compensation given by the Group in exchange for service rendered by employees or for termination of employment relationship, which include short-term employee benefits, post-employment benefits, termination benefits, etc.
(a)Short-term employee benefits
Short-term employee benefits include wages or salaries, bonus, allowances and subsidies, staff welfare, premiums or contributions on medical insurance, work injury insurance, housing funds, union running costs and employee education costs, short-term paid absences, etc. The short-term employee benefits actually occurred are recognised as a liability in the accounting period in which the service is rendered by the employees, with a corresponding charge to the profit or loss for the current period or the cost of relevant assets. Non-monetary benefits are measured at fair value.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(16)Employee benefits (Cont'd)
(b)Post-employment benefits
The Group classifies post-employment benefit plans as either defined contribution plans or defined benefit plans. Defined contribution plans are post-employment benefit plans under which the Group pays fixed contributions into a separate fund and will have no obligation to pay further contributions; and defined benefit plans are post-employment benefit plans other than defined contribution plans. During the reporting period, premiums or contributions on basic pensions and unemployment insurance paid for employees belong to defined contribution plans; supplementary retirement benefits for employees are defined benefit plans.
(i)Defined contribution plans
Basic pensions
The Group’s employees participate in the basic pension plan set up and administered by local authorities of Ministry of Human Resources and Social Security. Monthly payments of premiums on the basic pensions are calculated according to the bases and percentage prescribed by the relevant local authorities. When employees retire, the relevant local authorities are obliged to pay the basic pensions to them. The amounts based on the above calculations are recognised as liabilities in the accounting period in which the service has been rendered by the employees, with a corresponding charge to the profit or loss for the current period or the cost of relevant assets.
(ii)Defined benefit plans
The Group also provides employees with supplementary retirement benefits in addition to the insurance system prescribed by the State. Such supplementary retirement benefits belong to defined benefit plans. The defined benefit liabilities recognised on the balance sheet represent the present value of defined benefit obligations less the fair value of the plan assets. The defined benefit obligations are calculated annually by an independent actuary using projected unit credit method at the interest rate of treasury bonds with similar obligation term and currency. Service costs related to supplementary retirement benefits (including current service costs, historical service costs and settled gains or losses) and net interest are recognised in profit or loss for the current period or the cost of related assets, and changes arising from remeasurement of net liabilities or net assets of defined benefit plans are recognised in other comprehensive income.
(c)Termination benefits
The Group provides compensation for terminating the employment relationship with employees before the end of the employment contracts or as an offer to encourage employees to accept voluntary redundancy before the end of the employment contracts. The Group recognises a liability arising from compensation for termination of the employment relationship with employees, with a corresponding charge to profit or loss for the current period at the earlier of the following dates: 1) when the Group cannot unilaterally withdraw an employment termination plan or a curtailment proposal; 2) when the Group recognises costs or expenses for a restructuring that involves the payment of termination benefits.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(16)Employee benefits (Cont'd)
(c)Termination benefits (Cont’d)
Early retirement benefits
The Group offers early retirement benefits to those employees who accept early retirement arrangements. The early retirement benefits refer to the salaries and social security contributions to be paid to and for the employees who accept voluntary retirement before the normal retirement date prescribed by the State, as approved by the management. The Group pays early retirement benefits to those early retired employees from the early retirement date until the normal retirement date. The Group accounts for the early retirement benefits in accordance with the treatment for termination benefits, in which the salaries and social security contributions to be paid to and for the early retired employees from the off-duty date to the normal retirement date are recognised as liabilities with a corresponding charge to the profit or loss for the current period. The differences arising from the changes in the respective actuarial assumptions of the early retirement benefits and the adjustments of benefit standards are recognised in profit or loss in the period in which they occur.
The termination benefits expected to be settled within one year since the balance sheet date are classified as employee benefits payable.
(17)Dividend distribution
Cash dividends are recognised as liabilities in the period in which the dividends are approved at the shareholders’ meeting.
(18)Provisions
Provisions for product warranties, compensation to suppliers, etc. are recognised when the Group has a present obligation, it is probable that an outflow of economic benefits will be required to settle the obligation, and the amount of the obligation can be measured reliably.
A provision is initially measured at the best estimate of the expenditure required to settle the related present obligation. Factors on a contingency, such as the risks, uncertainties and the time value of money, are taken into account as a whole in reaching the best estimate of a provision. Where the effect of the time value of money is material, the best estimate is determined by discounting the related future cash outflows. The increase in the discounted amount of the provision arising from passage of time is recognised as interest expense.
The carrying amount of provisions is reviewed at each balance sheet date and adjusted to reflect the current best estimate.
The provisions expected to be settled within one year since the balance sheet date are classified as current liabilities.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(19)Revenue
The Group sells automobiles and automobile parts to distributors or end customers. In addition, the Group also provides customers with auto maintenance and additional quality warranty services. The Group recognises revenue at the amount of the consideration that is entitled to be charged by the Group as expected when the customer obtains control over relevant goods or services.
Where two or more obligations are included in a contract between the Group and the customers, at the beginning date of the contract, the Group allocates the transaction price to individual obligation in the relative proportion to the individual selling prices of products or services committed in each individual obligation. When the individual selling price is unobservable, the Group makes reasonable estimates on the individual selling price with comprehensive consideration to all available information, and by using market adjustment method, cost plus method, etc.
(a)Sale of automobiles and automobile parts to distributors and end customers
The Group sells automobiles and automobile parts to distributors and end customers. According to the contract, the delivery is completed after the products are delivered at the contracted delivery location and acceptance by both parties. The Group recognises the revenue at the timing of delivery completion. The credit periods granted by the Group to distributors and end customers are generally within one year, which is consistent with the industry practice, and there is no significant financing component. The Group provides product warranties for automobiles and automobile parts as required by laws and regulations and recognises the corresponding provisions (Note 2(18)). The Group provides distributors and end customers with sales discounts based on sales volume, and related revenue is recognised at contract consideration net of the discount amount estimated based on historical experience and using the expected value method.
(b)Rendering of services
The Group provides customers with automobile transportation, automobile maintenance and additional quality warranty services, and the revenue is recognised based on the progress of service provision within a certain period. According to the nature of the service provided, the performance progress is determined in accordance with the value of the labour provided to the customer.
When the Group recognises revenue based on the stage of completion, the amount with unconditional collection right obtained by the Group is recognised as accounts receivable, and the rest is recognised as contract assets. Meanwhile, loss provision for accounts receivable and contract assets are recognised on the basis of ECL (Note 2(8)). If the contract price received or receivable exceeds the amount for the completed service, the excess portion will be recognised as contract liabilities. Contract assets and contract liabilities under the same contract are presented on a net basis.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(20)Government grants
Government grants refer to the monetary or non-monetary assets obtained by the Group from the government at no consideration, including support funds for enterprise development, financial subsidies, etc.
Government grants are recognised when the grants can be received, and the Group can comply with all attached conditions. If a government grant is a monetary asset, it will be measured at the amount received or receivable. If a government grant is a non-monetary asset, it will be measured at its fair value. If it is unable to obtain its fair value reliably, it will be measured at its nominal amount.
Government grants related to assets refer to government grants which are obtained by the Group for the purposes of purchase, construction or acquisition of the long-term assets. Government grants related to income refer to the government grants other than those related to assets.
Government grants related to assets are recorded as deferred income and recognised in profit or loss on a reasonable and systemic basis over the useful lives of the assets. Government grants related to income that compensate future costs, expenses or losses are recorded as deferred income and recognised in profit or loss in reporting the related expenses; government grants related to income that compensate incurred costs, expenses or losses are recognised in profit or loss directly in the current period.
The Group applies the presentation method consistently to the similar government grants in the financial statements.
Government grants that are related to ordinary activities are included in operating profit, otherwise, they are recorded in non-operating income.
The Group recorded at the actual amount of borrowings when received the loans at policy-based preferential interest rates received and the related borrowing costs are calculated on the basis of the principal amount borrowed and the preferential interest rate under the policy.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(21)Deferred tax assets and deferred tax liabilities
Deferred tax assets and deferred tax liabilities are calculated and recognised based on the differences arising between the tax bases of assets and liabilities and their carrying amounts (temporary differences). Deferred tax asset is recognised for the deductible losses that can be carried forward to subsequent years for deduction of the taxable profit in accordance with the tax laws. No deferred tax liability is recognised for a temporary difference arising from the initial recognition of goodwill. No deferred tax asset or deferred tax liability is recognised for a temporary difference arising from the initial recognition of assets or liabilities due to a transaction other than a business combination where the initial recognition of assets or liabilities does not result in equal taxable temporary differences and deductible temporary differences, which affects neither accounting profit nor taxable profit (or deductible loss). At the balance sheet date, deferred tax assets and deferred tax liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled.
Deferred tax assets are only recognised for deductible temporary differences, deductible losses and tax credits to the extent that it is probable that taxable profit will be available in the future against which the deductible temporary differences, deductible losses and tax credits can be utilised.
Deferred tax liabilities are recognised for taxable temporary differences arising from investments in subsidiaries and associates, except where the Group is able to control the timing of reversal of such temporary differences, and it is probable that the temporary differences will not reverse in the foreseeable future. When it is probable that the deductible temporary differences arising from investments in subsidiaries and associates will be reversed in the foreseeable future and that the taxable profit will be available in the future against which the deductible temporary differences can be utilised, the corresponding deferred tax assets are recognised.
Deferred tax assets and deferred tax liabilities are offset when: ? the deferred tax assets and deferred tax liabilities are related to the same taxpayer within the Group and the same taxation authority; and ? that taxpayer within the Group has a legally enforceable right to offset current tax assets against current tax liabilities.
(22)Leases
A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(22)Leases (Cont’d)
The Group as the lessee
At the commencement date, the Group shall recognise the right-of-use asset and measure the lease liabilities at the present value of the lease payments that are not paid at that date. Lease payments include fixed payments, the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and payments of penalties for terminating the lease if the lessee exercises an option to terminate the lease. Variable lease payments in proportion to sales are excluded from lease payments and recognised in profit or loss as incurred. Lease liabilities that are due within one year (inclusive) as from the balance sheet date are included in the current portion of non-current liabilities.
The Group's right-of-use assets represent leased buildings. Right-of-use assets are measured initially at cost which comprises the amount of the initial measurement of lease liabilities, any lease payments made at or before the commencement date and any initially direct costs, less any lease incentives received. If it is reasonably probable that the Group will obtain ownership of the underlying asset by the end of the lease term, the asset is depreciated over its remaining useful life; otherwise, the asset is depreciated over the shorter of the lease term and its remaining useful life. The carrying amounts of the right-of- use assets are reduced to the recoverable amounts when the recoverable amounts are below their carrying amounts (Note 2(15)).
For short-term leases with a term of 12 months or less and leases of an individual asset (when new) of low value, the Group may, instead of recognising right-of-use assets and lease liabilities, recognise the lease payments in the cost of the underlying assets or in profit or loss for the current period on a straight-line basis over the lease term.
The Group shall account for a lease modification as a separate lease if both: (1) the modification extends the scope of the lease by adding the right to use one or more underlying assets; (2) the increased consideration is equivalent to the amount of the individual price of the expanded part of the lease scope adjusted according to the contract conditions.
For a lease modification that is not accounted for as a separate lease, the Group shall redetermine the lease term at the effective date of the lease modification and remeasure the lease liability by discounting the revised lease payments using a revised discount rate, except for the contract changes that may apply the simplified method as specified by the Ministry of Finance. For a lease modification which narrows the scope of the lease or shortens the lease term, the Group decreases the carrying amount of the right-of-use asset and recognises in profit or loss any gain or loss relating to the partial or full termination of the lease. For other changes which lead to the remeasurement of lease liabilities, the Group correspondingly adjusts the carrying amount of the right-of-use asset.
For the qualified rental waivers on existing lease contracts, the Group applies the simplified method, records the undiscounted waivers in profit or loss and adjusts lease liability when the agreement is reached to dismiss the original payment obligation.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(22)Leases (Cont'd)
The Group as the lessor
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset. An operating lease is a lease other than a finance lease.
(a)Operating lease
The Group leases out self-owned buildings and vehicles under operating leases, rental income is recognised on a straight-line basis over the lease term.
(b)Finance lease
At the commencement date of the lease term, the Group recognizes finance lease receivables and derecognizes the related assets for finance lease. The Group presents finance lease receivables as long-term receivables and finance lease receivables collected within one year (including one year) from the balance sheet date as non-current assets due within one year.
(23)Specific reserve
According to the decision of the State Council on Further Strengthening the work of production safety (Guo Fa [2004] No. 2), the Circular of the State Council on Further Strengthening the Work of Enterprise Production Safety (Guo Fa [2010] No. 23 ) and the Measures for the Administration of the Extraction and Use of Enterprise Production Safety Expenses (Cai Zi [2022] No. 136) issued by the Ministry of Finance and the Ministry of Emergency Response in December 2022, the Group extracted safety production costs at a certain percentage of its operating revenue in the previous year, which is specifically used for safety costs.
The Group's production safety expenses, which are extracted in accordance with the aforementioned national regulations, are included in the cost of relevant products or current profit or loss and are also included in special reserves.
When the safety fund is subsequently used for revenue expenditure, the specific reserve is reduced accordingly. On utilisation of the safety fund for fixed assets, the specific reserve is reduced as the fixed assets are recognised, which is the time when the related assets are ready for their intended use; in such cases, an amount that corresponds to the reduction in the specific reserve is recognised in accumulated depreciation with respect to the related fixed assets. As a consequence, such fixed assets are not depreciated in subsequent periods.
(24)Segment information
The Group identifies operating segments based on the internal organisation structure, management requirements and internal reporting system, and discloses segment information of reportable segments which is determined on the basis of operating segments.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(24)Segment information (Cont’d)
An operating segment is a component of the Group that satisfies all of the following conditions: (1) the component is able to earn revenues and incur expenses from its ordinary activities; (2) whose operating results are regularly reviewed by the Group’s management to make decisions about resources to be allocated to the segment and to assess its performance, and (3) for which the information on financial position, operating results and cash flows is available to the Group. Two or more operating segments that have similar economic characteristics and satisfy certain conditions can be aggregated into one single operating segment.
(25)Critical accounting estimates and judgements
The Group continually evaluates the critical accounting estimates and key judgements applied based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
(a)Critical judgements in applying the accounting policies
(i)Classification of financial assets
Significant judgements made by the Group in the classification of financial assets include business models and analysis on contractual cash flow characteristics.
The Group determines the business model for financial assets management on the group basis, and factors to be considered include the methods for evaluating the financial assets performance and reporting such performance to key management personnel, the risks relating to the financial asset’s performance and corresponding management methods, the ways in which related business management personnel are remunerated, etc.
When assessing whether contractual cash flow characteristics of financial assets are consistent with basic lending arrangement, key judgements made by the Group include: the possibility of changes in time schedule or amount of the principal during the lifetime due to reasons such as repayment in advance; whether interest only includes time value of money, credit risks, other basic lending risks and considerations for costs and profits. For example, whether the repayment in advance only reflects the principal outstanding and corresponding interest and reasonable compensation paid for early termination of the contract.
(ii)Judgement on significant increase in credit risk and occurrence of credit impairment
When the Group distinguishes the different stages of financial instruments, its judgement on significant increase in credit risk and occurrence of credit impairment is as follows:
Judgement made by the Group for significant increase in credit risk is mainly based on whether the overdue days exceed 30 days, or whether one or more of the following indicators change significantly: business environment of the debtor, internal and external credit rating, significant changes in actual or expected operating results, significant decrease in value of collateral or credit rate of guarantor, etc.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(25)Critical accounting estimates and judgements (Cont’d)
(a)Critical judgements in applying the accounting policies (Cont’d)
(ii)Judgement on significant increase in credit risk and occurrence of credit impairment (Cont’d)
Judgement made by the Group for the occurrence of credit impairment is mainly based on whether the overdue days exceed 90 days (i.e., a default has occurred), or whether one or more of the following conditions is/are satisfied: the debtor is suffering significant financial difficulties, the debtor is undergoing other debt restructuring, or the debtor probably goes bankrupt, etc.
(iii)Judgement on capitalisation of development expenditures
Development expenditures are capitalised when the criteria in Note 2(14)(e) are fulfilled. The assessments on whether the criteria for capitalisation of development expenditures have been met involve judgements of the Group, including the technical feasibility of the project, the likelihood of the project generating sufficient future economic benefits and the timing to start capitalisation particularly. The Group makes the judgements on the capitalisation of development expenditures and records the process in meeting minutes based on feasibility analysis, regular review on the development project phase, etc.
(iv)Timing of revenue recognition
The Group sells automobiles and automobile parts to distributors or end customers. According to the contract, the delivery is completed after the products are delivered at the contracted delivery location and acceptance by both parties. Thereafter, the distributors or end customers own the products, have the right to set prices independently, and bear the risks from price fluctuation or damage of the products. The distributors or end customers have obtained the control of the products after accepting the products. The Group recognises the revenue at the timing of the delivery completion.
(v)Sales with product warranties
The Group provides statutory warranty for automobiles and automobile parts, and the periods and terms of such warranty comply with the requirements of laws and regulations related to the products. The Group does not provide any significant additional service or additional warranty for this purpose; thus this kind of warranty cannot be identified as a separate performance obligation. In addition, the Group also offers additional warranty other than the requirements of laws and regulations, which is identified as a separate performance obligation. The Group recognises the revenue of the additional warranty over time during the period when services are rendered.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(25)Critical accounting estimates and judgements (Cont’d)
(b)Critical accounting estimates and key assumptions
The critical accounting estimates and key assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next fiscal year are outlined below:
(i)Measurement of ECL
The Group calculates ECL through default risk exposure and ECL rate and determines the ECL rate based on default probability and default loss rate or aging matrix. In determining the ECL rate, the Group uses data such as internal historical credit loss experience, etc., and adjusts historical data based on current conditions and forward-looking information. When considering forward-looking information, the Group takes different macroeconomic scenarios into consideration. In 2023, the weights of “base”, “bad” and “good” are 68%, 16% and 16% (2022: 68%, 16% and 16%) under three economic scenarios respectively for the consideration of forward-looking information. The Group regularly monitors, and reviews important macroeconomic assumptions and parameters related to the calculation of ECL rate, including the risks of economic downturn, external market environment, changes of technological environment and customer, gross domestic product, consumer price index, broad money supply and nominal interest rate. In 2023, the Group has considered the uncertainty under different macroeconomic scenarios and updated relevant assumptions and parameters accordingly. The key macroeconomic parameters used in each scenario are listed as follows:
Scenarios
BaseBadGood
Broad money supply8.58%8.06%9.11%
Consumer price index5.08%2.83%7.34%
Nominal interest rate0.11%0.23%-0.01%
In 2022, the key macroeconomic parameters used in each scenario are listed below:
Scenarios
BaseBadGood
Gross domestic product4.56%2.02%7.11%
Consumer price index3.45%-33.12%40.02%

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(25)Critical accounting estimates and judgements (Cont’d)
(b)Critical accounting estimates and key assumptions (Cont’d)
(ii)Accounting estimate on provision for impairment of long-term assets
When the Group performs impairment tests for long-term assets if there is any indication that the long-term assets may be impaired, if the result of the impairment test indicates that the recoverable amount of an asset is less than its carrying amount, a provision for impairment and an asset impairment loss are recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount of an asset is the higher of the fair value less the cost of disposal and the present value of the future cash flows expected to be derived from the asset. These calculations require the use of estimates (Note 4(13), Note 4(14), Note 4(17) and Note 14(3)). When the Group uses the present value of estimated future cash flows to determine the recoverable amount, as there are uncertainties about the development of economic environment in which the relevant region is situated, the revenue growth rate, the gross profit margin rate and the pre-tax discount rate used in calculating the present value of estimated future cash flows are also subject to uncertainties. If management revises the growth rate, the gross margin rate and the pre-tax discount rate that is used in the calculation of the future cash flows of related asset groups, and the revised rate is lower than the current rate, the Group would need to recognise further impairment against related assets. If the actual growth rate, the gross profit margin rate are higher than management’s estimates or the actual pre-tax discount rate is lower than management’s estimates, the impairment loss of related assets previously recognised is not allowed to be reversed by the Group.
When the Group uses the fair value less disposal costs to determine the recoverable amount, the recoverable amount is determined by the price of a sale agreement in an arm’s length transaction, less the costs that are directly attributable to the disposal of the asset. Where there is no sales agreement but there is an active market of assets, the amount is determined by the market price less the costs that are directly attributable to the disposal of the asset. The market price of assets is determined by the considerations provided by the buyer. Where there is no sales agreement or active market of assets, the amount of an asset’s fair value less disposal costs was determined based on the best information available.
Disposal costs include legal cost, taxes and handling fee related to asset disposal, and direct costs incurred to bring the assets to a saleable state.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(25)Critical accounting estimates and judgements (Cont’d)
(b)Critical accounting estimates and key assumptions (Cont’d)
(iii)Income tax and deferred income tax (Cont’d)
The Group is subject to enterprise income tax in multiple regions. There are some transactions and events for which the ultimate tax treatment is uncertain during the ordinary course of business. Significant judgement is required from the Group in determining the provision for income taxes in each of these regions. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.
As stated in Note 3(2), the Company is a high-tech enterprise. The “High-Tech Enterprise Certificate” is effective for three years. Upon expiration, application for high-tech enterprise assessment should be submitted again to the relevant government authorities. Based on the past experience of reassessment for high-tech enterprise upon expiration and its actual conditions, the Company considers that it is able to obtain the qualification for high- tech enterprises in the next three years, and therefore a preferential tax rate of 15% is used to calculate the corresponding deferred income tax. If the Company cannot obtain the qualification for high-tech enterprise upon expiration, then the Company is subject to a statutory tax rate of 25% for the calculation of income tax, which further influences the recognised deferred tax assets, deferred tax liabilities and income tax expenses.
Deferred tax assets are recognised for the deductible tax losses that can be carried forward to subsequent years to the extent that it is probable that taxable profit will be available in the future against which the deductible tax losses can be utilised. Taxable profit that will be available in the future includes the taxable profit that will be realised through ordinary course of business and the taxable profit that will be increased upon the future reversal of taxable temporary differences incurred in prior periods. Judgements and estimates are required to determine the time and amounts of taxable profit in the future. Any difference between the reality and the estimate may result in adjustment to the carrying amount of deferred tax assets.
(iv)Provisions
The Group undertakes after-sales repair or replacement obligations for automobiles sold based on the after-sales service agreement. Management estimates related provisions based on historical after-sales service data, including the repair and replacement provided as well as current trends. Factors that may impact the estimation of warranty costs include improvement of the Group’s productivity and production quality, as well as changes in related parts and labour costs. Any increase or decrease in provisions will have impact on profit or loss of the Group in the future.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

2Summary of significant accounting policies and accounting estimates (Cont’d)
(25)Critical accounting estimates and judgements (Cont’d)
(b)Critical accounting estimates and key assumptions (Cont’d)
(v)Provision for decline in the value of inventories
The Group's inventories are stated at the lower of cost and net realisable value. Net realisable value of inventories is the amount of the estimated selling price in the ordinary course of business, less the estimated costs to completion, estimated contract performance costs, estimated costs necessary to make the sales and related taxes.
If the management revises the estimated selling price of the inventory, the estimated costs to be incurred by the time of completion, and the estimated selling and distribution expenses and related taxes, the revised estimated selling price is lower than the currently adopted estimated selling price, or the revised until The estimated costs, estimated contract performance costs, sales expenses, and related taxes and fees at the completion of the project are higher than the currently adopted estimates, the Group needs to make provision for decline in the value of inventory.
If the actual selling prices, costs to completion, estimated contract performance costs, selling and distribution expenses and related taxes are higher or lower than management’s estimates, the Group shall recognise the relevant differences in the consolidated income statement during the corresponding accounting period.
(26)Significant changes in accounting policies
The Ministry of Finance released the Circular on Issuing Interpretation No. 16 of Accounting Standards for Business Enterprises (Interpretation No. 16) in 2022. The Group and the Company has adopted the new lease standard since 1 January 2019, and recognised deferred income tax on a net basis related to temporary differences in lease liabilities and right-of-use assets. The Group and the Company adopted the provision "On the inapplicability of exemption at initial recognition to the accounting treatment of deferred income tax related to assets and liabilities arising from individual transactions" stipulated in Interpretation No. 16 from 1 January 2023, and deferred tax assets and deferred tax liabilities were recognised by the Group and the Company respectively for the equal deductible temporary differences and taxable temporary differences arising from the above transactions, and are disclosed in the notes respectively. The related notes as at 31 December 2022 are adjusted accordingly. The implementation of the above provisions of Interpretation No. 16 has no impact on the Group’s and the Company’s profit or loss for the current period of 2022 and financial statement line items as at 1 January 2022 and 31 December 2022.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

3Taxation
(1)The main categories and rates of taxes applicable to the Group are set out below:
CategoryTaxation basisTax rate
Enterprise income tax (a)Taxable income15% and 25%
Value-added tax (“VAT”) (b)Taxable value-added amount (Tax payable is calculated using the taxable sales amount multiplied by the applicable tax rate less deductible input VAT of the current period)13%, 9% and 6%
Consumption tax (c)Taxable sales amount3%, 5% and 9%
City maintenance and construction tax (d)The payment amount of VAT and consumption tax5% and 7%
(a)Pursuant to the Circular on Enterprise Income Tax Policy Concerning Deductions for Equipment and Appliances (Cai Shui [2018] No. 54) and the Announcement on Extending the Implementation Period of Certain Preferential Tax Policies (Cai Shui [2021] No. 6) issued by the State Taxation Administration and relevant regulations, during the period from 1 January 2018 to 31 December 2023, the cost of newly purchased equipment with the original cost less than RMB5 million can be fully deducted against taxable profit in the next month after the asset is put into use, instead of being depreciated annually for tax filing.
(b)Pursuant to the Announcement on Relevant Policies for Deepening Value-Added Tax Reform (Announcement [2019] No. 39) and relevant regulations jointly issued by the Ministry of Finance, the State Taxation Administration and the General Administration of Customs, the Group’s taxable products sales revenue is subject to the VAT at the rate of 13%. The Group's real estate leasing business is subject to the VAT at the rate of 9% and revenue from provision of technical service to external parties is subject to VAT at the rate of 6%.
(c)Pursuant to the Interim Regulations of the People's Republic of China on Consumption Tax promulgated by the State Council (Order No. 539 of the State Council of the People's Republic of China) and the Notice of Ministry of Finance and State Taxation Administration on Adjusting Consumption Tax Policies for Passenger Cars (Cai Shui [2008] No. 105), the consumption tax rates of the Group's taxable products are 3%, 5% and 9%.
(d)Pursuant to the Circular of the State Council on Unifying the Collection of City Maintenance and Construction Tax and Educational Surcharge on Domestic and Foreign-Owned Enterprises and Individuals (Guo Fa [2010] No. 35) issued by the State Council, the Group is subject to city maintenance and construction tax at the rates of 5% and 7%.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

3Taxation (Cont’d)
(2)Tax preference
(a)Pursuant to the Circular on the Announcement of the First Batch of High-Tech Enterprises of Jiangxi Province for the year 2021 (Gan Gao Qi Ren Ban [2021] No. 8), the Company is certified as a high-tech enterprise, and the valid term is three years. Under Article 28 of the Enterprise Income Tax Law of the People's Republic of China, the income tax rate applicable to the Company for the year of 2023 is 15% (2022: 15%).
In 2023, except for the Company, the Company’s wholly-owned companies, including JMC Heavy Duty Vehicle Co., Ltd. (“JMCH”), Jiangling Motor Sales Co., Ltd. (“JMCS”), Shenzhen Fujiang New Energy Automobile Sales Co., Ltd. (“SZFJ”), Guangzhou Fujiang New Energy Automobile Sales Co., Ltd. (“GZFJ”), and Jiangling Ford Automobile Technology (Shanghai) Co., Ltd. (“Jiangling Ford (Shanghai)”) were subject to the enterprise income tax at the rate of 25% (2022: 25%).
(b)Pursuant to the Announcement on Clarifying the Additional Value-added Tax Credit Policy for the Advanced Manufacturing Enterprises (Cai Shui [2023] No. 43) jointly issued by the Ministry of Finance and the State Taxation Administration, the Company, as an advanced manufacturing enterprise, is allowed to offset against the VAT payable by the 1.5 times amount of input tax deductible in the current period from 1 January 2023 to 31 December 2027.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements
(1)Cash at bank and on hand
31 December 202331 December 2022
Cash at bank10,653,646,8117,656,947,735
Cash at finance company (a) (Note 7(6))1,092,871,804886,245,919
Other cash and cash equivalents (b)20,854,424-
Interest receivable63,187,63661,784,071
11,830,560,6758,604,977,725
(a)As at 31 December 2023, the group's bank deposit with Jiangling Automobile Group Finance Co, Ltd. was RMB1,092,871,804. The Group's bank deposits placed with Jiangling Motor Group Finance Company Limited(“JMCF”) bear interest at the bank's annual interest rate of 0.455% - 2.25% (31 December 2022: 1.725% - 2.25%) on RMB deposits for the same period. JMCF, a holding subsidiary of Jiangling Motors Group Co., Ltd (“JMCG”), is a non-banking financial institution. JMCG holds 50% equity capital of Nanchang Jiangling Investment Co., Ltd. (“JIC”), a main shareholder of the Company.
(b)Other cash and cash equivalents of RMB20,854,424 (December 31, 2022: Nil) were the frozen funds of the Group's litigation.
(2)Financial assets held for trading
31 December 202331 December 2022
Structural deposits200,604,877-
(3)Derivative financial assets and derivative financial liabilities
31 December 202331 December 2022
Derivative financial assets -
Forward exchange contracts-2,972,698
Derivative financial liabilities -
Forward exchange contracts459,306-

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(4)Notes receivable
31 December 202331 December 2022
Trade acceptance notes14,638,901743,071,151
Less: Provision for bad debts(17,564)(318,421)
14,621,337742,752,730
As at 31 December 2023, the Group didn’t have notes receivable from Jiangxi Jiangling Import & Export Co., Ltd. (31 December 2022: RMB600,000,000) (Note 7(6)).
(a)As at 31 December 2023, there were no notes receivable pledged.
(b)Provision for bad debts
For notes receivable arising from sales of goods and rendering of services in the ordinary course of operating activities, the Group measures the loss provision based on the lifetime ECL regardless of whether there is a significant financing component.
The provision for bad debts of notes receivable is analysed by category as follows:
31 December 2023
Book balanceProvision for bad debts
Amount% of total balanceAmountProvision ratio
Provision for bad debts on the grouping basis (i)14,638,901100%(17,564)0.12%
31 December 2022
Book balanceProvision for bad debts
Amount% of total balanceAmountProvision ratio
Provision for bad debts on the grouping basis (i)743,071,151100%(318,421)0.04%

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(4)Notes receivable (Cont’d)
(b)Provision for bad debts (Cont’d)
(i)Notes receivable for which the provision for bad debts is provided on the grouping basis are analysed as follows:
Grouping - Trade acceptance notes: As at 31 December 2023, the Group’s provision for bad debts for trade acceptance notes of the grouping was measured based on the lifetime ECL, and the related amount was RMB17,564 (31 December 2022: RMB318,421), of which RMB300,857 was reversed in 2023 (2022: accrual of RMB318,421) .
(ii)The amount of bad debt provision collected or reversed during the year was RMB300,857, of which RMB600,000,000 of the notes receivable from Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. on December 31, 2022 had been fully recovered during the year by the Group.
(iii)There was no provision for bad debts actually written off during the year.
(5)Accounts receivable
31 December 202331 December 2022
Accounts receivable4,529,566,6824,367,065,120
Less: Provision for bad debts(127,740,660)(121,523,368)
4,401,826,0224,245,541,752

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(5)Accounts receivable (Cont’d)
(a)The aging of accounts receivable was analysed as follows:
31 December 202331 December 2022
Within 1 year4,354,838,8624,183,936,645
1 to 2 years28,667,06412,186,785
Over 2 years146,060,756170,941,690
4,529,566,6824,367,065,120
As at 31 December 2023, accounts receivable with individually significant amounts and aged over three years were analyzed as follows:
BalanceReasons and risk of collection
Company 172,230,000As the debtor had difficulties in operation and was involved in several lawsuits, the Group considered that the receivable was difficult to be recovered and therefore a provision for bad debts had been made in full.
Company 237,924,214The Group considered that the new energy subsidy amount was difficult to be recovered from relevant subsidy distribution departments over a long period of time and therefore a provision for bad debts had been made in full.
Company 326,719,887Due to the cash flow arrangement of the debtor, the accounts receivable had a long aging, but the debtor has a good historical collection situation and still has normal business dealings with the Group, and the Group considered that the receivables were likely to be recovered, so a provision for bad debts was made in the grouping - sales of general automobiles.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(5)Accounts receivable (Cont’d)
(b)As at 31 December 2023, the top five accounts receivable ranked by the balances of the debtors are analysed as follows:
BalanceAmount of provision for bad debts% of total balance
The total accounts receivable of the top five balances2,925,806,673(77,947,678)65%
(c)Provision for bad debts
For accounts receivable, the Group measures the loss provision based on the lifetime ECL regardless of whether there is a significant financing component.
The provision for bad debts of accounts receivable was analysed by category as follows:
31 December 2023
Book balanceProvision for bad debts
Amount% of total balanceAmountProvision ratio
Provision for bad debts on the individual basis (i)110,154,2142%(110,154,214)100.00%
Provision for bad debts on the grouping basis (ii)4,419,412,46898%(17,586,446)0.40%
4,529,566,682100%(127,740,660)2.82%
31 December 2022
Book balanceProvision for bad debts
Amount% of total balanceAmountProvision ratio
Provision for bad debts on the individual basis (i)110,154,2143%(110,154,214)100.00%
Provision for bad debts on the grouping basis (ii)4,256,910,90697%(11,369,154)0.27%
4,367,065,120100%(121,523,368)2.78%
(i)Accounts receivable for which the provision for bad debts was provided on the individual basis were analysed follows:
31 December 2023
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
New energy subsidies receivable37,924,214100%(37,924,214)
Receivables for automobiles72,230,000100%(72,230,000)
110,154,214(110,154,214)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(5)Accounts receivable (Cont’d)
(c)Provision for bad debts (Cont’d)
(i)Accounts receivable for which the provision for bad debts is provided on the individual basis are analysed follows (Cont’d):
31 December 2022
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
New energy subsidies receivable37,924,214100%(37,924,214)
Receivables for automobiles72,230,000100%(72,230,000)
110,154,214(110,154,214)
As at 31 December 2023, The Group assessed the expected credit losses on the related accounts receivable, the Group considered the receivables cannot be collected, therefore, full provision was made for those receivables. The related amount was RMB110,154,214(31 December 2022: RMB110,154,214), of which none (2022: RMB35,617,634) was included in profit or loss for the current period.
(ii)Accounts receivable for which provision for bad debts is made on the grouping basis are analysed as follows:
Grouping - Domestic sales of general automobiles:
31 December 2023
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
Not overdue1,330,216,0180.12%(1,651,582)
Overdue for 1 to 30 days41,413,3250.18%(74,476)
Overdue for 31 to 60 days24,216,8672.28%(553,239)
Overdue for 61 to 90 days32,435,3703.34%(1,083,923)
Overdue over 90 days76,187,7165.18%(3,948,751)
1,504,469,296(7,311,971)
Grouping - Export sales of general automobiles:
31 December 2023
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
Not overdue2,647,787,9030.20%(5,295,576)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(5)Accounts receivable (Cont’d)
(c)Provision for bad debts (Cont’d)
(ii)Accounts receivable for which provision for bad debts is made on the grouping basis are analysed as follows (Cont’d):
Grouping - Sales of general automobiles (Cont’d):
31 December 2022
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
Not overdue3,342,241,0630.04%(1,433,732)
Overdue for 1 to 30 days191,926,4070.04%(82,244)
Overdue for 31 to 60 days60,431,8061.07%(645,450)
Overdue for 61 to 90 days28,747,8502.07%(596,073)
Overdue over 90 days132,725,5543.14%(4,170,090)
3,756,072,680(6,927,589)
Grouping - Sales of new energy automobiles:
31 December 2023
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
Overdue over 90 days5,123,26080.00%(4,098,608)
31 December 2022
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
Overdue over 90 days8,803,26031.06%(2,734,591)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(5)Accounts receivable (Cont’d)
(c)Provision for bad debts (Cont’d)
(ii)Accounts receivable for which provision for bad debts is made on the grouping basis are analysed as follows (Cont’d):
Grouping – Automobile parts:
31 December 2023
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
Not overdue242,349,0990.30%(727,047)
Overdue for 1 to 30 days16,195,4860.30%(48,586)
Overdue for 31 to 60 days728,6600.50%(3,643)
Overdue for 61 to 90 days839,1640.60%(5,035)
Overdue over 90 days1,919,6005.00%(95,980)
262,032,009(880,291)
31 December 2022
Book balanceProvision for bad debts
AmountLifetime ECL (%)Amount
Not overdue467,350,9480.30%(1,402,053)
Overdue for 1 to 30 days16,889,5580.30%(50,669)
Overdue for 31 to 60 days1,741,5520.50%(8,708)
Overdue for 61 to 90 days1,297,7460.60%(7,786)
Overdue over 90 days4,755,1625.00%(237,758)
492,034,966(1,706,974)
(iii)The amount of provision for bad debts for the year was RMB6,217,292 and the Group didn’t have provision for bad debts reversed or collected.
(d)There was no provision for bad debts actually written off during the year.
(e)As at 31 December 2023 and 31 December 2022, there were no accounts receivable pledged.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(6)Financing receivables
31 December 202331 December 2022
Bank acceptance notes123,170,062376,662,817
The Group endorses the bank acceptance notes as required by daily fund management, which also met the criteria for derecognition, and therefore classified those the bank acceptance notes as financial assets at fair value through other comprehensive income. In 2023, the Group endorsed and discounted bank acceptance notes, and almost all risks and rewards of ownership have been transferred to other parties, accordingly, the carrying amounts of bank acceptance notes that were derecognised by the Group were RMB1,040,525,217 and RMB2,435,317,198(2022: RMB829,293,203 and RMB2,439,408,138) respectively, and the related losses on discount of RMB9,867,768 (2022: RMB15,303,265) were included in investment income (Note 4(51)).
As at 31 December 2023 and 31 December 2022, as the credit risk characteristics of these bank acceptance notes were similar, no provision for impairment was made individually. In addition, the Group considered that its bank acceptance notes were not exposed to significant credit risk and the probability of default of these banks was very low.
As at 31 December 2023 and 31 December 2022, the Group had no pledged bank acceptance notes receivable presented in financing receivables.
As at 31 December 2023, the Group's bank acceptance notes had been endorsed or discounted but not yet matured were RMB1,277,970,531, which had been derecognised.
There was no significant write-offs of financing receivables for the Group in 2023 (2022: Nil).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(7)Advances to suppliers
(a)The aging of advances to suppliers is analysed as follows:
31 December 202331 December 2022
Amount% of total balanceAmount% of total balance
Within 1 year204,358,759100%277,743,526100%
(b)As at 31 December 2023, the top five advances to suppliers by the balances of the debtors are analysed as follows:
Amount% of total balance
Total prepayments of the top five balances192,713,71094%
(8)Other receivables
31 December 202331 December 2022
Receivables from refund of social insurance23,958,000-
Advance payment of gas expenses12,769,14112,919,400
Import working capital7,000,00010,000,000
Guarantees6,974,6166,978,985
Receivables from platform utilization4,757,2704,510,173
Receivables from disposal of assets4,604,7454,604,745
Receivables from disposal of subsidiaries-60,900,000
Others15,659,06011,484,677
75,722,832111,397,980
Less: Provision for bad debts(402,984)(334,608)
75,319,848111,063,372
The Group did not have any fund deposited at other parties under the centralised fund management and represented in other receivables.
(a)The aging of other receivables is analysed as follows:
31 December 202331 December 2022
Within 1 year67,035,16047,163,619
Over 1 year8,687,67264,234,361
75,722,832111,397,980

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(8)Other receivables (Cont’d)
(b)Provision for losses and changes in book balance statements:
The provision for bad debts of other receivables is analysed by category as follows:
31 December 2023
Book balanceProvision for bad debts
Amount% of total balanceAmountProvision ratio
Provision for bad debts on the individual basis (i)23,958,00032%--
Provision for bad debts on the grouping basis (i)51,764,83268%(402,984)0.78%
75,722,832100%(402,984)0.53%
31 December 2022
Book balanceProvision for bad debts
Amount% of total balanceAmountProvision ratio
Provision for bad debts on the grouping basis (i)111,397,980100%(334,608)0.30%
Stage 1
12-month ECL (grouping)12-month ECL (individual)Total
Book balanceProvision for bad debtsBook balanceProvision for bad debtsProvision for bad debts
31 December 2022111,397,980(334,608)--(334,608)
Decrease in the current year(59,633,148)-
Increase in the current year-23,958,000
Provision for bad debts accrued during the year(68,376)-(68,376)
31 December 202351,764,832(402,984)23,958,000-(402,984)
As at 31 December 2023 and 31 December 2022, the Group had no other receivables at Stage 2 and Stage 3. The analysis of other receivables at Stage 1 was stated below:
(i)As at 31 December 2023, the Group’s other receivables with provision for bad debts were analysed below:

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(8)Other receivables (Cont’d)
(b)Provision for losses and changes in book balance statements (Cont’d):
Book balance12-month ECL ratesProvision for bad debtsReason
Provision on the individual basis:
Receivables from refund of social insurance i)23,958,000--ECL
Provision on the grouping basis:
Advance payment of gas expenses12,769,1410.78%(99,406)ECL
Import working capital7,000,0000.78%(54,494)ECL
Guarantees6,974,6160.78%(54,297)ECL
Receivables from platform utilization4,757,2700.78%(37,035)ECL
Receivables from disposal of assets4,604,7450.78%(35,847)ECL
Others15,659,0600.78%(121,905)ECL
75,722,832(402,984)
i) The Group assessed the receivables from refund of social insurance individually and based on the judgment of credit risk, the receivables were not subject to significant credit risk and were not overdue and impaired.
(i)As at 31 December 2022, the Group’s other receivables with provision for bad debts on the grouping basis are analysed as follows:
Book balance12-month ECL ratesProvision for bad debtsReason
Provision on the grouping basis:
Receivables from disposal of subsidiaries60,900,0000.30%(182,700)ECL
Advance payment of gas expenses12,919,4000.30%(39,072)ECL
Import working capital10,000,0000.30%(30,000)ECL
Guarantees6,978,9850.30%(21,037)ECL
Receivables from disposal of assets4,604,7450.30%(13,814)ECL
Receivables from platform utilization4,510,1730.30%(13,531)ECL
Others11,484,6770.30%(34,454)ECL
111,397,980(334,608)
(c)The provision for bad debts in the current year amounted to RMB68,376, of which none was collected or reversed.
(d)There was no provision for bad debts actually written off during the year.
(e)As at 31 December 2023, the top five other receivables by the balances of the debtors are listed as follows:
NatureBalanceAging% of total balanceProvision for bad debts
Company 1Receivables from refund of social insurance23,958,000within 1 year32%-
Company 2Advance payment of gas expenses12,769,141within 1 year17%(99,406)
Company 3Import working capital, etc.8,636,151within 1 year11%(67,362)
Company 4Receivables from platform utilization4,757,270within 1 year6%(37,035)
Company 5Receivables from disposal of assets, etc4,614,745Over 1 year6%(35,995)
54,735,30772%(239,798)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(9)Inventories
(a)Inventories were summarised by category as follows:
31 December 202331 December 2022
Book balanceProvision for decline in the value of inventoriesCarrying amountBook balanceProvision for decline in the value of inventoriesCarrying amount
Raw materials802,679,074(130,036,719)672,642,3551,077,387,177(70,415,497)1,006,971,680
Finished goods497,244,891-497,244,891695,697,324-695,697,324
Work in progress194,945,039(816,091)194,128,948254,199,491(857,711)253,341,780
Low value consumables83,217,698(2,830,181)80,387,51793,411,573(537,572)92,874,001
Materials in transit71,613,700-71,613,70042,989,505-42,989,505
Materials consigned for processing44,242,100-44,242,10037,166,530-37,166,530
1,693,942,502(133,682,991)1,560,259,5112,200,851,600(71,810,780)2,129,040,820
(b)Provision for decline in the value of inventories was analysed as follows:
31 December 2022Increase in the current yearDecrease in the current year31 December 2023
ProvisionReversalWrite-off
Raw materials(70,415,497)(75,808,171)5,088,17011,098,779(130,036,719)
Low value consumables(537,572)(2,830,181)-537,572(2,830,181)
Work in progress(857,711)(27,868)11369,375(816,091)
(71,810,780)(78,666,220)5,088,28311,705,726(133,682,991)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(9)Inventories (Cont’d)
(c)Provision for decline in the value of inventories was analysed as follows:
Specific basis for determining net realisable valueReason for current year reversal or write-off of provision for decline in the value of inventories
Raw materials/Work in progress/Low value consumablesBased on the estimated selling price, less the estimated costs to completion, estimated contract performance costs and selling and distribution expenses and related taxesIncrease in the net realisable value of the provision for decline in the value of inventories had been made in prior years or sales realised
(10)Other current assets
31 December 202331 December 2022
Taxes prepaid, input VAT to be deducted and to be verified951,659,5561,362,502,624
(11)Current portion of non-current assets
31 December 202331 December 2022
Current portion of long-term receivables (Note 4(12))15,749,80613,851,634
(12)Long-term receivables
31 December 202331 December 2022
Long-term receivables41,919,49348,695,467
Less: Unearned financing income(3,268,233)(3,549,703)
Provision for bad debts(125,758)(146,086)
Current portion of long-term receivables (Note 4(11))(15,749,806)(13,851,634)
22,775,69631,148,044
As at 31 December 2023, the Group's long-term receivables were generated by instalment collections from disposal of fixed assets, which will be recovered from 2024 to 2026.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(13)Long-term equity investments
31 December 202331 December 2022
Associates
- Shanxi Yunnei Power Co., Ltd. (“The Power Company”)202,327,605211,055,689
- Hanon Systems (Nanchang) Co., Ltd. (“Hanon Systems”)31,470,74337,427,133
Less: Provision for impairment of long-term equity investments--
233,798,348248,482,822
Associates
Movements for the current yearImpairment provision
31 December 2022Increase/ Decrease in investmentShare of net profit/(loss) under equity methodCash dividends declaredProvision for impairment31 December 2023Shareholding (%)Voting rights (%)31 December 202331 December 2022
The Power Company211,055,689-(8,728,084)--202,327,60540%40%
Hanon Systems37,427,133-(863,034)(5,093,356)-31,470,74319.15%33.33%--
Total248,482,822-(9,591,118)(5,093,356)-233,798,348--

Related information of equity in associates is set forth in Note 5(2).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(14)Fixed assets
31 December 202331 December 2022
Fixed assets (a)5,389,534,4795,446,006,505
Fixed assets pending for disposal (b)110,673377,864
5,389,645,1525,446,384,369
(a)Fixed assets
.BuildingsMachinery and equipmentVehiclesMouldsElectronic and other equipmentTotal
Cost
31 December 20222,213,414,0203,153,309,149475,545,1793,454,685,6254,168,066,13813,465,020,111
Increase in the current year
Transfers from construction in progress14,364,168127,141,23653,344,909696,236,531242,395,6061,133,482,450
Decrease in the current year
Disposal or retirement(1,619,408)(18,506,958)(15,160,248)(29,492,865)(32,750,576)(97,530,055)
Others-(35,415,779)(608,803)-(37,446,032)(73,470,614)
31 December 20232,226,158,7803,226,527,648513,121,0374,121,429,2914,340,265,13614,427,501,892
Accumulated depreciation
31 December 2022(419,406,028)(1,788,482,688)(278,327,488)(2,546,577,850)(2,632,387,758)(7,665,181,812)
Increase in the current year
Provision(56,710,274)(214,245,173)(51,081,935)(241,418,334)(352,557,355)(916,013,071)
Decrease in the current year
Disposal or retirement1,042,66815,593,2657,060,03226,232,66130,260,40880,189,034
Others-26,378,157584,451-34,852,14061,814,748
31 December 2023(475,073,634)(1,960,756,439)(321,764,940)(2,761,763,523)(2,919,832,565)(8,439,191,101)
Provision for impairment
31 December 2022-(12,392,150)(2,571,080)(323,447,442)(15,421,122)(353,831,794)
Increase in the current year
Provision(172,020,613)(22,775,844)(4,029,155)(16,292,533)(37,075,497)(252,193,642)
Decrease in the current year
Disposal or retirement-6,934,68747,71047,737218,9907,249,124
31 December 2023(172,020,613)(28,233,307)(6,552,525)(339,692,238)(52,277,629)(598,776,312)
Carrying amount
31 December 20231,579,064,5331,237,537,902184,803,5721,019,973,5301,368,154,9425,389,534,479
31 December 20221,794,007,9921,352,434,311194,646,611584,660,3331,520,257,2585,446,006,505
In 2023, depreciation charged to fixed assets amounted to RMB916,013,071 (2022: RMB906,176,838), of which the depreciation expenses charged in the cost of sales, selling and distribution expenses, general and administrative expenses and research and development expenses were RMB757,170,123, RMB6,127,943, RMB91,423,304 and RMB61,291,701 (2022: RMB744,253,418, RMB2,284,506, RMB94,102,502 and RMB65,536,412), respectively.
The costs of fixed assets transferred from construction in progress amounted to RMB1,133,482,450 (2022: RMB655,886,896).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(14)Fixed assets(Cont’d)
(a)Fixed assets (Cont’d)
In 2023, as the governmental approvals required for the Group's equity transfer transaction of JMCH were not completed within the agreed timeframe, the equity transaction was terminated and the recoverable amount of the related assets was no longer estimated on the basis of the price agreed by the parties to the equity transfer transaction. Since the JMCH asset group was idled and there was no clear plan for its subsequent operation, there was an indication of impairment of the related assets. The Group performed an impairment test on the JMCH asset group, and determined the recoverable amount of the relevant asset group to be RMB179,306,352 by using the net of the fair value less disposal costs, thus a provision for impairment of RMB244,115,449 was made for the difference between the recoverable amount and the carrying amount as of December 31, 2023.
(i)Temporarily idle fixed assets
As at 31 December 2023, the fixed assets with a carrying amount of approximately RMB179,453,179 (a cost of RMB1,324,043,538) (31 December 2022: a carrying amount of approximately RMB507,898,988 and a cost of RMB1,521,049,605) were idle due to the termination of the equity transfer transaction of JMCH and the change of product process of the Group. The analysis was as follows:
CostAccumulated depreciationProvision for impairmentCarrying amount
Buildings409,162,422(106,134,440)(172,020,613)131,007,369
Machinery and equipment149,106,343(109,381,121)(22,855,494)16,869,728
Vehicles54,951,470(45,339,755)(6,499,884)3,111,831
Moulds418,979,062(106,314,993)(312,571,501)92,568
Electronic and other equipment291,844,241(216,096,569)(47,375,989)28,371,683
1,324,043,538(583,266,878)(561,323,481)179,453,179
(ii)Fixed assets with pending certificates of ownership:
Carrying amountReason for not obtaining certificates of ownership
Buildings3,147,676Pending procedures
(b)Fixed assets pending for disposal
31 December 202331 December 2022
Electronic and other equipment85,891216,104
Machinery and equipment24,782161,363
Vehicles-397
110,673377,864

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(15)Construction in progress
31 December 202331 December 2022
Book balanceProvision for impairmentCarrying amountBook balanceProvision for impairmentCarrying amount
Projects for passenger vehicles192,375,226(4,460,314)187,914,91287,126,228-87,126,228
Projects for commercial vehicles176,425,357(1,284,000)175,141,357537,796,267-537,796,267
Projects for automobile parts factory28,037,073-28,037,0735,424,980-5,424,980
Projects for automobiles factory17,752,703-17,752,70342,929,882-42,929,882
Others56,277,013(691,646)55,585,36746,026,479(691,646)45,334,833
470,867,372(6,435,960)464,431,412719,303,836(691,646)718,612,190

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(15)Construction in progress (Cont’d)
(a)Movement of significant projects of construction in progress
Project nameBudget (In RMB0’000)31 December 2022Increase in the current yearTransfer to fixed assets in the current yearTransfer to intangible assets in the current year31 December 2023% of project investment in budgetProgress of projectAccumulative capitalised borrowing costsIncluding: Borrowing costs capitalised in the current yearSource of fund
Projects for commercial vehicles285,769537,796,267540,210,979(901,581,889)-176,425,35771%71%--Self-owned funds
Projects for passenger vehicles114,30187,126,228178,852,310(73,253,754)(349,558)192,375,22660%60%--Self-owned funds
Projects for automobiles factory322,44442,929,88249,605,840(73,966,981)(816,038)17,752,70375%75%--Self-owned funds
Projects for automobile parts factory23,8605,424,98037,066,851(14,454,758)-28,037,07353%53%--Self-owned funds
Others46,026,479138,717,917(70,225,068)(58,242,315)56,277,013292,897-Self-owned funds and borrowings
719,303,836944,453,897(1,133,482,450)(59,407,911)470,867,372292,897-
The Group's light passenger regeneration project, light truck regeneration project and pick-up truck regeneration project of Project for commercial vehicles reached its intended design requirements and was available for its intended use after installation, commissioning and acceptance in 2023 and was transferred to fixed assets accordingly.
(b)Provision for impairment of construction in progress
31 December 2022Increase in the current yearDecrease in the current year31 December 2023Reason for provision
Projects for passenger vehicles-(4,460,314)-(4,460,314)The recoverable amount is lower than the carrying amount
Projects for commercial vehicles-(1,284,000)-(1,284,000)The recoverable amount is lower than the carrying amount
Other miscellaneous and pending installation projects(691,646)--(691,646)The recoverable amount is lower than the carrying amount
(691,646)(5,744,314)-(6,435,960)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(16)Right-of-use assets
Buildings
Cost
31 December 2022349,143,173
Increase in the current year
New lease contracts43,438,812
Decrease in the current year
Expiration of lease contract(22,679,790)
31 December 2023369,902,195
Accumulated depreciation
31 December 2022(115,520,283)
Increase in the current year
Provision(82,225,674)
Decrease in the current year
Expiration of lease contract22,679,790
31 December 2023(175,066,167)
Provision for impairment
31 December 2022-
Increase in the current year-
Decrease in the current year-
31 December 2023-
Carrying amount
31 December 2023194,836,028
31 December 2022233,622,890

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(17)Intangible assets
Land use rightsSoftware use feesNon-patent technologiesAfter-sales services management modeOthersTotal
Cost
31 December 2022628,964,157334,638,3061,086,102,00536,979,1841,599,5162,088,283,168
Increase in the current year
Transfers from construction in progress-59,407,911---59,407,911
Internal research and development--753,676,631--753,676,631
31 December 2023628,964,157394,046,2171,839,778,63636,979,1841,599,5162,901,367,710
Accumulated amortisation
31 December 2022(139,952,223)(191,182,266)(484,757,266)(36,979,184)(1,599,516)(854,470,455)
Increase in the current year
Provision(13,273,110)(44,204,334)(245,982,064)--(303,459,508)
31 December 2023(153,225,333)(235,386,600)(730,739,330)(36,979,184)(1,599,516)(1,157,929,963)
Provision for impairment
31 December 2022--(38,806,961)--(38,806,961)
Increase in the current year
Provision--(13,609,665)--(13,609,665)
31 December 2023--(52,416,626)--(52,416,626)
Carrying amount
31 December 2023475,738,824158,659,6171,056,622,680--1,691,021,121
31 December 2022489,011,934143,456,040562,537,778--1,195,005,752
As at 31 December 2023, the intangible assets developed by the Group accounted for 56% (31 December 2022: 36%) of the carrying amount of intangible assets.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(18)Expenditure on research and development
The Group's total expenditure on research and development activities in 2023 and 2022 is presented by nature as follows:
20232022
Employee benefits724,160,168594,665,238
Design fee513,146,559535,652,184
Consumed materials263,541,026226,896,289
Depreciation and amortisation67,981,814220,663,278
Others277,552,954440,623,543
1,846,382,5212,018,500,532
Wherein expenditure on research and development on the research phase (Note 4(45))1,286,201,6121,483,329,630
(a)The changes in the Group's development expenditures eligible for capitalisation in 2023 is analysed as follows:
31 December 2022Increase in the current yearTransfer to intangible assets in the current year31 December 2023
Projects for passenger vehicles(i)-283,738,155-283,738,155
Projects for commercial vehicles(ii)477,233,877276,442,754(753,676,631)-
477,233,877560,180,909(753,676,631)283,738,155
(i)The capitalisation of Project for passenger vehicles started when the relevant products are ready and the relevant research data is frozen, and it has passed the internal technical review meeting of the Group. Upon completion of the development of the project, it is expected to be used for mass production of product SUV that is competitive in the market. The project progress of the main product as of December 31, 2023 is 71%, and the completion point of the Project is expected to be the first half year of 2024.
(ii)The capitalisation of Project for commercial vehicles started when the relevant products are ready and the relevant research data is frozen, and it has passed the internal technical review meeting of the Group. The development of the project had completed in 2023, and it is expected to be used for mass production of product light duty passenger car and pickup truck that is competitive in the market.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(18)Expenditure on research and development (Cont’d)
In 2023, there was no impairment of the Group's projects under development expenditures (2022: Nil).
(19)Deferred tax assets and deferred tax liabilities
(a)Deferred tax assets before offsetting
31 December 202331 December 2022
Deductible temporary differences and deductible lossesDeferred tax assetsDeductible temporary differences and deductible lossesDeferred tax assets
Accrued expenses and provisions5,860,011,3271,364,811,5204,978,763,7761,120,987,322
Recoverable losses2,443,729,567389,836,0533,634,617,217571,696,850
Provision for asset impairment1,192,154,407183,615,4371,092,015,809168,415,220
Non-patent technology304,526,21863,692,824208,440,04750,268,260
Lease liability218,076,09234,258,049265,315,03659,319,046
Employee education funds unpaid81,356,93812,728,70288,505,94913,780,833
Deferred income67,601,36110,140,20460,849,6439,127,446
Retirement benefits plan10,515,0002,172,35055,374,00013,438,000
Others186,761,22728,046,234142,951,64722,139,372
10,364,732,1372,089,301,37310,526,833,1242,029,172,349
Including:
Expected to be recovered within 1 year (inclusive)1,615,927,1251,409,297,322
Expected to be recovered after 1 year473,374,248619,875,027
2,089,301,3732,029,172,349

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(19)Deferred tax assets and deferred tax liabilities (Cont’d)
(b)Deferred tax liabilities before offsetting
31 December 202331 December 2022
Taxable temporary differencesDeferred tax liabilitiesTaxable temporary differencesDeferred tax liabilities
Depreciation of fixed assets2,912,652,979556,699,4422,823,844,034652,665,271
Right-of-use assets194,836,02830,336,433233,622,89051,945,980
Equity transactions between parent and subsidiary125,800,00018,870,000408,000,00061,200,000
Differences between the fair value of the identifiable net assets and carrying amount arising from business combinations involving enterprises not under common control77,027,55919,256,89093,221,43623,305,359
Amortisation of intangible assets73,907,06011,171,82956,434,37112,193,000
Others1,064,183220,1152,972,698445,905
3,385,287,809636,554,7093,618,095,429801,755,515
Including:
Expected to be recovered within 1 year (inclusive)111,712,132155,108,225
Expected to be recovered after 1 year524,842,577646,647,290
636,554,709801,755,515

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(19)Deferred tax assets and deferred tax liabilities (Cont’d)
(c)Deductible temporary differences and deductible losses for which no deferred tax asset was recognised were analysed as follows:
31 December 202331 December 2022
Deductible temporary differences2,020,124,2061,380,025,289
Deductible losses276,440,468202,505,688
2,296,564,6741,582,530,977
(d)Deductible losses for which no deferred tax asset was recognised will be expired in following years:
31 December 202331 December 2022
2024109,336,011109,336,011
2025--
2026--
202793,001,63193,169,677
202874,102,826-
276,440,468202,505,688
(e)The net balances of deferred tax assets and deferred tax liabilities after offsetting were as follows:
31 December 202331 December 2022
Offsetting amountBalance after offsettingOffsetting amountBalance after offsetting
Deferred tax assets(617,297,819)1,472,003,554(778,450,156)1,250,722,193
Deferred tax liabilities(617,297,819)19,256,890(778,450,156)23,305,359
(20)Other non-current assets
31 December 202331 December 2022
Prepayment for molds10,807,967-

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(21)Provision for asset impairment and losses
31 December 2022Increase in the current yearDecrease in the current year31 December 2023
ReversalWrite-off /Disposal
Provision for bad debts of notes receivable (Note 4(4))318,421-(300,857)-17,564
Provision for bad debts of accounts receivable (Note 4(5))121,523,3686,217,292--127,740,660
Including: Provision for bad debts on the individual basis110,154,214---110,154,214
Provision for bad debts on the grouping basis11,369,1546,217,292--17,586,446
Provision for bad debts of other receivables (Note 4(8))334,60868,376--402,984
Provision for bad debts of long-term receivables (Note 4(12))146,086-(20,328)-125,758
Sub-total122,322,4836,285,668(321,185)-128,286,966
Provision for decline in the value of inventories (Note 4(9))71,810,78078,666,220(5,088,283)(11,705,726)133,682,991
Provision for impairment of fixed assets (Note 4(14))353,831,794252,193,642-(7,249,124)598,776,312
Provision for impairment of construction in progress (Note 4(15))691,6465,744,314--6,435,960
Provision for impairment of goodwill (i)89,028,412---89,028,412
Provision for impairment of intangible assets (Note 4(17))38,806,96113,609,665--52,416,626
Sub-total554,169,593350,213,841(5,088,283)(18,954,850)880,340,301
676,492,076356,499,509(5,409,468)(18,954,850)1,008,627,267
(i)As at 31 December 2019, the Group had made full provision for impairment of goodwill.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(22)Short-term borrowings
31 December 202331 December 2022
Credit loan1,300,000,0001,100,000,000
As at 31 December 2023, the Group had no overdue short-term borrowings and the interest rates ranged from 1.73% to 2.40% (31 December 2022: 2.35% to 2.75%).
(23)Accounts payable
31 December 202331 December 2022
Payable for automobile parts9,094,393,8258,783,467,597
Payable for raw and auxiliary materials381,821,398232,510,757
9,476,215,2239,015,978,354
As at 31 December 2023, accounts payable with aging over one year amounted to RMB408,228,798 (31 December 2022: RMB652,758,141), which mainly represented payables for materials for which a settlement price had not yet been determined, and such payables had not been finally settled yet.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(24)Contract liabilities
31 December 202331 December 2022
Advances for maintenance and warranty services, etc.226,857,269175,905,460
Advances for automobiles and automobile parts137,176,92494,400,145
364,034,193270,305,605
Less: Contract liabilities carried forward to revenue after 1 year (Note 4(35))(120,293,201)(118,240,580)
243,740,992152,065,025
In 2023, contract liabilities amounting to RMB152,065,025 included in the carrying amount as at 31 December 2022 were transferred to the revenue of 2023 (2022: RMB272,274,177), including advances for automobiles and automobile parts amounting to RMB94,400,145 (2022: RMB223,779,674), and advances for maintenance and warranty services amounting to RMB57,664,880 (2022: RMB48,494,503).
(25)Employee benefits payable
31 December 202331 December 2022
Short-term employee benefits payable (a)882,869,951631,243,123
Defined contribution plans payable (b)1,818,160279,041,381
Defined benefit plans payable (c)2,865,0002,803,000
Termination benefits payable (d)2,498,1762,616,176
890,051,287915,703,680
(a)Short-term employee benefits
31 December 2022Increase/Reverse in the current yearDecrease in the current year31 December 2023
Wages and salaries, bonus, allowances and subsidies454,910,9232,101,027,809(1,817,277,828)738,660,904
Staff welfare59,167,71090,476,487(92,711,534)56,932,663
Social security contributions24,132,419113,892,292(137,872,026)152,685
Including: Medical insurance17,300,118114,138,861(131,317,337)121,642
Work injury insurance6,832,301(246,569)(6,554,689)31,043
Housing funds467,942194,917,987(195,356,994)28,935
Labour union funds and employee education funds92,564,12935,428,618(40,897,983)87,094,764
Other short-term employee benefits-6,694,457(6,694,457)-
631,243,1232,542,437,650(2,290,810,822)882,869,951

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(25)Employee benefits payable (Cont’d)
(b)Defined contribution plans
31 December 2022Increase/Reverse in the current yearDecrease in the current year31 December 2023
Basic pensions260,527,342114,351,678(373,117,311)1,761,709
Supplementary pensions10,400,000(10,400,000)--
Unemployment insurance8,114,0393,553,829(11,611,417)56,451
279,041,381107,505,507(384,728,728)1,818,160
(c)Defined benefit plans
31 December 2022Increase in the current yearDecrease in the current year31 December 2023
Post-retirement benefits payable (Note 4(34))2,803,0002,454,630(2,392,630)2,865,000
(d)Termination benefits payable
31 December 202331 December 2022
Early retirement benefits payable (Note 4(34))1,160,0001,278,000
Other termination benefits (i)1,338,1761,338,176
2,498,1762,616,176
(i)

In 2023, other termination benefits paid by the Group for termination of the employmentrelationship were RMB14,126,035 (2022: RMB2,893,734).

(26)Taxes payable
31 December 202331 December 2022
Consumption tax payable73,794,90487,601,901
Enterprise income tax payable18,702,20755,230,198
Land use tax payable4,831,9534,831,953
Unpaid VAT637,39124,542,717
Others20,433,31021,042,835
118,399,765193,249,604

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(27)Other payables
31 December 202331 December 2022
Promotion expenses2,978,276,6812,566,403,266
Research and development project expenses968,699,6061,139,399,835
Construction payment539,487,510534,127,177
Transportation expenses148,140,843239,369,691
Advertising and new product planning fees166,568,934160,966,200
Guarantees124,132,883111,554,518
Consulting fees31,808,40622,274,659
Technological transformation project expenses23,333,42051,152,889
Trademark license fee17,037,45313,971,949
Ordinary share dividends payable6,463,8366,463,836
Others941,026,521827,024,491
5,944,976,0935,672,708,511
As at 31 December 2023, other payables with aging over one year of RMB1,967,233,887 (31 December 2022: RMB1,696,105,568) mainly comprised guarantees collected from distributors and repair stations, payables for promotion, payables for research and development expenses and payables for construction projects. Such payables had not been finally settled yet in view of the continuing business transactions with distributors and service providers, and engineering projects and research and development projects that had not yet been accepted and completed.
(28)Current portion of non-current liabilities
31 December 202331 December 2022
Current portion of lease liabilities (Note 4(31))80,070,14972,224,685
Current portion of long-term borrowings (Note 4(30))13,313,749456,071
93,383,89872,680,756
(29)Other current liabilities
31 December 202331 December 2022
Provisions expected to be settled within 1 year (Note 4(32))356,115,630374,617,524
Others17,833,00012,272,018
373,948,630386,889,542

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(30)Long-term borrowings
31 December 202331 December 2022
Guaranteed loans(a)1,855,2192,280,355
Credit loans(b)12,849,94419,033,773
Less: Current portion of long-term borrowings (Note 4(28))(13,313,749)(456,071)
1,391,41420,858,057
(a)As at 31 December 2023, the above guaranteed loans were long-term borrowings amounting to USD 261,937 guaranteed by JMCF (note7(c)), borrowed from Industrial and Commercial Bank of China (“ICBC”), Nanchang Ganjiang Sub-branch with interests paid every half year and the principal paid in instalments between 10 December 2007 and 27 October 2027.
Starting dateMaturity dateCurrencyInterest rate (%)31 December 202331 December 2022
Amount in foreign currencyRMB equivalentAmount in foreign currencyRMB equivalent
ICBC Nanchang Ganjiang Sub - branch27 February 199827 October 2027USD1.5%261,9371,855,219327,4212,280,355
(b)As at 31 December 2023, the principal amount of bank credit borrowings is repayable in installments during 2024.
(c)As at 31 December 2023, the Group had no overdue long-term borrowings and the Group’s interest rates ranged from 1.5% to 2.5% (31 December 2022: 1.5% to 2.5%).
(31)Lease liabilities
31 December 202331 December 2022
Lease liabilities (a)218,076,092265,315,036
Less: Current portion of non- current liabilities (Note 4(28))(80,070,149)(72,224,685)
138,005,943193,090,351
(a)As at 31 December 2023, the Group had no leases that were not included in lease liabilities but will result in potential future cash outflows.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(32)Provisions
31 December 2022Increase in the current yearDecrease in the current year31 December 2023
Product warranties (a)610,033,067330,658,844(282,305,185)658,386,726
Provisions for contract fulfilment15,347,046-(1,917,879)13,429,167
625,380,113330,658,844(284,223,064)671,815,893
Less: Provisions expected to be settled within 1 year (Note 4(29))(374,617,524)(356,115,630)
250,762,589315,700,263
(a)Product warranties are expenses expected to be incurred during the warranty period from free after-sales services, product warranty and other services for the vehicles sold.
(33)Deferred income
31 December 2022Increase in the current yearDecrease in the current year31 December 2023
Government grants60,849,64310,265,000(3,513,282)67,601,361
(a)Government grants
31 December 2022Increase in the current yearDecrease in the current year
Recognised in other income31 December 2023
Government grants related to assets10,335,417-(1,610,714)8,724,703
Government grants related to income50,514,22610,265,000(1,902,568)58,876,658
60,849,64310,265,000(3,513,282)67,601,361

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(34)Long-term employee benefits payable
31 December 202331 December 2022
Supplementary retirement benefits and early-retirement benefits eligible for recognition of provisions56,916,00055,374,000
Less: Payable within 1 year(4,025,000)(4,081,000)
52,891,00051,293,000
The retirement and early-retirement benefits payable within one year are included in employee benefits payable (Note 4(25)(c), Note 4(25)(d)).
For retired and early-retired employees, the Group provides them with a certain amount of supplementary benefits during their retirement or early-retirement period. The amount of benefits depends on the employee’s position, length of service and salary at the time of retirement or early-retirement, and is adjusted in accordance with inflation rate and other factors. The Group’s obligations for supplementary retirement and early-retirement benefits as at the balance sheet date were calculated using projected unit credit method and were reviewed by an external independent actuary.
(a)Movements of retirement and early-retirement benefits of the Group are as follows:
Present value of the obligations of the defined benefit plan
31 December 202331 December 2022
Opening balance55,374,00059,941,000
Cost of defined benefit plans recognised in profit or loss for the current period
- Current service cost1,141,0001,161,000
- Past service cost--
- Actuarial gains or losses recognised immediately(331,000)82,000
- Net interest1,610,0001,744,000
Remeasurement of net liabilities for defined benefit plans
- Actuarial (gains)/losses2,593,000(3,918,000)
Other movements
- Benefits paid(3,471,000)(3,636,000)
Ending balance56,916,00055,374,000

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(34)Long-term employee benefits payable (Cont’d)
(b)The major actuarial assumptions used to determine the present value of defined benefit plan obligations of the Group
31 December 202331 December 2022
Discount rate2.50%3.00%
Inflation rate2.00%2.00%
Salaries and benefits growth rates0%-6%0%-6%
Future mortality assumptions were determined based on the China Life Insurance Mortality Table (2010-2013), which is publicly available statistical information for the Chinese region.
(c)The sensitivity analysis of the major actuarial assumptions used to determine the present value of defined benefit plan obligations of the Group was analysed as follows:
Variation in assumptionsEffect on present value of defined benefit obligations
Assumed increaseAssumed decrease
Discount rate0.5%Decrease of 5.8%Increase of 6.6%
Inflation rate0.5%Increase of 3.8%Decrease of 3.3%
The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, changes in some of the assumptions may be correlated. The projected unit credit method is also utilised in calculating the present value of the defined benefit obligations in the analysis.
(d)Supplementary retirement and early-retirement benefits expose the Group to various risks, mainly including risk of changes in the interest rate of treasury bonds and inflation risk. Decline in the interest rate of treasury bonds will lead to an increase in defined benefit plan liabilities. Supplementary retirement and early-retirement benefits obligations keep pace with inflation, and the rise in inflation will increase the defined benefit plan liabilities.
(35)Other non-current liabilities
31 December 202331 December 2022
Contract liabilities carried forward to revenue after 1 year (Note 4(24))120,293,201118,240,580

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(36)Share capital
31 December 2022Movements for the current year31 December 2023
Shares newly issuedBonus shareTransfer from capital surplusOthersSub-total
Shares subject to trading restriction -
Other domestic shares
Including: Shares held by domestic non-state-owned legal persons745,140-----745,140
Shares held by domestic natural persons5,700-----5,700
750,840-----750,840
Shares not subject to trading restriction -
Ordinary shares denominated in RMB518,463,160-----518,463,160
Domestically listed foreign shares344,000,000-----344,000,000
862,463,160-----862,463,160
863,214,000-----863,214,000
Since the implementation of the Company’s Scheme on Share Split Reform on 13 February 2006, as at 31 December 2023, there were 750,840 shares currently unavailable for trading. During the reporting period, there was no shares with trading restrictions released from the restricted conditions.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(36)Share capital (Cont’d)
31 December 2021Movements for the current year31 December 2022
Shares newly issuedBonus shareTransfer from capital surplusOthersSub-total
Shares subject to trading restriction -
Other domestic shares
Including: Shares held by domestic non-state-owned legal persons745,140-----745,140
Shares held by domestic natural persons5,700-----5,700
750,840-----750,840
Shares not subject to trading restriction -
Ordinary shares denominated in RMB518,463,160-----518,463,160
Domestically listed foreign shares344,000,000-----344,000,000
862,463,160-----862,463,160
863,214,000-----863,214,000

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(37)Capital surplus
31 December 2022Increase in the current yearDecrease in the current year31 December 2023
Share premium816,609,422--816,609,422
Other capital surplus22,833,068--22,833,068
839,442,490--839,442,490
31 December 2021Increase in the current yearDecrease in the current year31 December 2022
Share premium816,609,422--816,609,422
Other capital surplus22,833,068--22,833,068
839,442,490--839,442,490

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(38)Other comprehensive income
Other comprehensive income in the balance sheetOther comprehensive income in the income statement for the year ended 31 December 2023
31 December 2022Attributable to the parent company after tax31 December 2023Amount incurred before income tax for the current yearLess: Transfer-out of previous other comprehensive income in the current yearLess: Income tax expensesAttributable to the parent company after taxAttributable to the subsidiary after tax
Other comprehensive income that will not be reclassified to profit or loss
Actuarial gains on defined benefit plans(13,484,250)(7,087,750)(20,572,000)(2,593,000)-(4,494,750)(7,087,750)-
Other comprehensive income in the balance sheetOther comprehensive income in the income statement for the year ended 31 December 2022
31 December 2021Attributable to the parent company after tax31 December 2022Amount incurred before income tax for the current yearLess: Transfer-out of previous other comprehensive income in the current yearLess: Income tax expensesAttributable to the parent company after taxAttributable to the subsidiary after tax
Other comprehensive income that will not be reclassified to profit or loss
Actuarial gains on defined benefit plans(16,422,750)2,938,500(13,484,250)3,918,000-(979,500)2,938,500-

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(39)Surplus reserve
31 December 2022Increase in the current yearDecrease in the current year31 December 2023
Statutory surplus reserve431,607,000--431,607,000
31 December 2021Increase in the current yearDecrease in the current year31 December 2022
Statutory surplus reserve431,607,000--431,607,000
In accordance with the Company Law of the People’s Republic of China, the Company’s Articles of Association and the resolution of the Board of Directors, the Company should appropriate 10% of net profit for the year to the statutory surplus reserve, and the Company can cease appropriation when the statutory surplus reserve accumulated to more than 50% of the registered capital. The statutory surplus reserve can be used to make up for the loss or increase the share capital upon approval from the appropriate authorities. As the accumulated appropriation to the statuary surplus reserve exceeded 50% of the registered capital, no appropriation was made in the current year (2022: Nil).
The Company reserves the discretionary surplus reserve after the shareholders’ meeting approves the proposal from the Board of Directors. The discretionary surplus reserve can be used to compensate for the losses incurred in prior years or increase the share capital upon approval from appropriate authorities.
(40)Retained earnings
20232022
Retained earnings at the beginning of the year7,123,038,0936,437,603,849
Add: Net profit attributable to shareholders of the parent company for the current year1,475,597,266915,049,168
Less: Ordinary share dividends payable (a)(366,002,736)(229,614,924)
Retained earnings at the end of the year8,232,632,6237,123,038,093
(a)According to the resolution of the Board of Directors on 16 June 2023, the Company proposed to distribute cash dividends of RMB0.424 per share to all shareholders, calculated on the basis of 863,214,000 issued shares, for a total of RMB366,002,736.
According to the resolution of the meeting of Board of Directors on 28 Mar 2024, the Board of Directors proposed to distribute cash dividends of RMB0.684 per share to all shareholders of the Company, calculated on the basis of 863,214,000 issued shares, for a total of RMB590,438,376 (Note 10).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(41)Revenue and cost of sales
20232022
Revenue from main operations32,673,950,27829,592,525,919
Revenue from other operations493,374,803507,757,923
33,167,325,08130,100,283,842
20232022
Cost of sales from main operations27,647,797,67425,336,987,529
Cost of sales from other operations417,730,549475,277,339
28,065,528,22325,812,264,868
(a)Revenue and cost of sales from main operations
20232022
Revenue from main operationsCost of sales from main operationsRevenue from main operationsCost of sales from main operations
Sales of automobiles30,379,757,73325,855,510,80127,069,207,53823,355,537,374
Sales of automobile parts1,719,943,0331,230,323,6852,412,993,5401,872,040,360
Automobile maintenance services, etc.574,249,512561,963,188110,324,841109,409,795
32,673,950,27827,647,797,67429,592,525,91925,336,987,529
(b)Revenue and cost of sales from other operations
20232022
Revenue from other operationsCost of sales from other operationsRevenue from other operationsCost of sales from other operations
Sales of materials330,754,338296,981,256366,469,354339,411,405
Others162,620,465120,749,293141,288,569135,865,934
493,374,803417,730,549507,757,923475,277,339

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(41)Revenue and cost of sales (Cont’d)
(c)The breakdown of the Group’s revenue by product and service transfer time was as follows:
2023
AutomobilesAutomobile partsAutomobile maintenance services, etc.Materials and othersTotal
Revenue from main operations30,379,757,7331,719,943,033574,249,512-32,673,950,278
Including: Recognised at a time point30,379,757,7331,719,943,033--32,099,700,766
Recognised within a certain period--574,249,512-574,249,512
Revenue from other operations (i)---493,374,803493,374,803
30,379,757,7331,719,943,033574,249,512493,374,80333,167,325,081
2022
AutomobilesAutomobile partsAutomobile maintenance services, etc.Materials and othersTotal
Revenue from main operations27,069,207,5382,412,993,540110,324,841-29,592,525,919
Including: Recognised at a time point27,069,207,5382,412,993,540--29,482,201,078
Recognised within a certain period--110,324,841-110,324,841
Revenue from other operations (i)---507,757,923507,757,923
27,069,207,5382,412,993,540110,324,841507,757,92330,100,283,842
(i)The Group's revenue from other operations includes sales of materials and technical service provided. Revenue from sales of materials is recognised at a certain time point, and revenue from technical service provided is recognised within a certain period.
As at 31 December 2023, the amount of revenue corresponding to the performance obligations that the Group had contracted but had not commenced or completed was RMB364,034,193, of which the Group expects that RMB137,176,924 and RMB106,564,068 will be recognised as revenue from the sales of automobiles and parts and revenue from the sales of automobile maintenance services respectively in 2024, RMB120,293,201 will be recognised as revenue from automobile maintenance services from 2025 to 2029.
(42)Taxes and surcharges
20232022
Consumption tax807,035,414690,818,768
City maintenance and construction tax54,093,79899,989,565
Educational surcharge53,936,76798,742,654
Land use tax20,610,24622,286,670
Real estate tax19,364,21920,887,510
Stamp tax18,749,57118,217,884
Others381,313451,064
974,171,328951,394,115

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(43)Selling and distribution expenses
20232022
Promotion expenses521,049,350413,790,869
Warranties330,658,844381,747,663
Employee benefits230,660,091214,370,379
Advertising and new product planning fees168,368,816187,517,174
Storage expenses49,903,37748,853,162
Packaging material expenses33,681,58031,608,268
Depreciation and amortisation expenses12,751,5713,558,412
Others119,618,818163,448,784
1,466,692,4471,444,894,711
(44)General and administrative expenses
20232022
Employee benefits565,612,010544,315,552
Depreciation and amortisation expenses147,236,553143,207,652
Trademark license fee69,249,22368,813,097
Repair expenses30,690,59637,951,031
Consulting fees24,038,09126,261,406
General office expenses11,811,21217,095,983
Cartage fee3,212,15811,458,649
Others131,608,188115,682,975
983,458,031964,786,345
(45)Research and development expenses
20232022
Employee benefits574,111,697430,170,063
Design fee209,447,053304,491,964
Materials expenses242,947,545197,330,293
Depreciation and amortisation expenses67,981,814220,663,278
Others191,713,503330,674,032
1,286,201,6121,483,329,630

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(46)Financial expenses
20232022
Interest costs31,751,48236,417,358
Add: Interest costs on lease liabilities10,093,30812,887,851
Interest expenses41,844,79049,305,209
Less: Interest income from cash at bank(237,934,702)(220,037,622)
Other interest income(13,117,861)(16,271,337)
Interest income(251,052,563)(236,308,959)
Exchange gains or losses2,882,28622,205,504
Others1,416,733890,900
(204,908,754)(163,907,346)
(47)Expenses by nature
The cost of sales, selling and distribution expenses, general and administrative expenses and research and development expenses in the income statement are listed as follows by nature:
20232022
Changes in inventories of finished goods and work in progress257,637,510(3,902,524)
Consumed raw materials and low value consumables, etc.25,132,665,84522,878,764,631
Employee benefits2,666,489,1922,556,734,264
Depreciation of fixed assets916,013,071906,176,838
Amortisation of intangible assets303,459,508199,424,503
Depreciation of right-of-use assets82,225,67470,119,650
Transportation expenses499,191,963610,883,899
Promotion expenses521,049,350413,790,869
Warranties330,658,844381,747,663
Design fee209,447,053304,491,964
Advertising and new product planning fees168,368,816187,517,174
Technology development expenses166,375,068190,609,379
Fixed asset repair and maintenance expenses (a)130,842,815122,958,397
Others417,455,604885,958,847
31,801,880,31329,705,275,554

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(47)Expenses by nature (Cont’d)
(a)The Group includes daily maintenance expenses ineligible for the capitalisation of fixed assets regarding the production and processing of inventories into cost of inventories, which will be carried forward to cost of sales, and those regarding the R&D Department, Administrative Department, and Sales Department are included in research and development expenses, management expenses and selling and distribution expenses respectively.
(b)As stated in Note 2(22), the Group directly recognises the lease payments of short-term lease and low value lease into profit or loss for the current period. In 2023, the amount was RMB2,619,206 (2022: RMB5,147,442).
The lessor didn’t exempt the Group from paying the rental for the 2023 period (2022: exempted the rental for RMB22,851, and the Group had deducted the rental waivers against the rental expense for the current period).
(48)Asset impairment losses
20232022
Impairment of fixed assets252,193,642763,162
Losses on decline in the value of inventories73,577,9376,479,606
Impairment of intangible assets13,609,665-
Impairment of construction in progress5,744,314-
345,125,5587,242,768
(49)Credit impairment losses
20232022
Losses on bad debts of accounts receivable6,217,29212,497,418
Losses on bad debts of other receivables68,376(701,952)
Losses on bad debts of notes receivable(300,857)318,421
Losses on bad debts of long-term receivables(20,328)(47,041)
5,964,48312,066,846
(50)Other income
20232022Asset related/ Income related
Government grants
- Supporting funds by government552,216,000906,908,600Income related
- Research and development activities related subsidies2,752,567810,319Income related
- Equipment purchasing-related subsidies1,610,714939,583Asset related
- Other subsidies related with daily operation6,520,85033,132,873Income related
Additional deduction of input VAT, etc.4,429,6351,535,181
567,529,766943,326,556

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(51)Investment income
20232022
Losses on discount of financing receivables eligible for derecognition (Note 4(6))(9,867,768)(15,303,265)
Losses on long-term equity investments under equity method(9,591,118)(8,768,433)
Investment income/(loss) from forward exchange settlement6,757,648(13,534,785)
Investment income from financial assets held for trading2,122,1921,523,836
(10,579,046)(36,082,647)
There is no significant restriction on the remittance of investment income of the Group.
(52)Gains on changes in fair value
20232022
Derivative financial assets and derivative financial liabilities -
(Losses)/Gains on forward exchange contracts(3,432,004)13,677,317
Financial assets at fair value through profit or loss -
Structural deposits604,877(242,329)
(2,827,127)13,434,988
(53)Gains on disposal of assets
20232022Amount recognised in non-recurring profit or loss in 2023
(Losses)/Gains on disposal of assets(3,908,476)391,369,117(3,908,476)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(54)Non-operating income
20232022Amount recognised in non-recurring profit or loss in 2023
Penalty income2,016,3943,539,2962,016,394
Others6,859,486248,9726,859,486
8,875,8803,788,2688,875,880
(55)Non-operating expenses
20232022Amount recognised in non-recurring profit or loss in 2023
Losses on scrapping of assets3,544,9122,117,6423,544,912
Donations2,005,0502,007,2802,005,050
Others491,061357,040491,061
6,041,0234,481,9626,041,023
(56)Income tax expenses
20232022
Current income tax calculated based on tax law and related regulations(36,527,990)55,769,297
Deferred income tax(229,824,580)(19,081,691)
(266,352,570)36,687,606

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(56)Income tax expenses (Cont’d)
The reconciliation from income tax calculated based on the applicable tax rates and total profit presented in the consolidated income statement to the income tax expenses is listed as follows:
20232022
Total profit798,142,127899,566,225
Income tax calculated at applicable tax rates119,721,319134,934,934
Effect of different applicable tax rates(327,690,005)108,932,026
Additional deductions(211,427,507)(230,686,396)
Deductive loss and temporary differences of the unrecognised deferred tax asset in the current period138,918,71823,495,176
Tax deduction-(1,487,861)
Non-deductible investment losses1,438,6681,315,266
Costs, expenses and losses not deductible for tax purposes12,686,237184,461
Income tax expenses(266,352,570)36,687,606
(57)Earnings per share
(a)Basic earnings per share
Basic earnings per share are calculated by dividing consolidated net profit attributable to ordinary shareholders of the parent company by the weighted average number of outstanding ordinary shares of the parent company:
20232022
Consolidated net profit attributable to ordinary shareholders of the parent company1,475,597,266915,049,168
Weighted average number of ordinary shares outstanding issued by the Company863,214,000863,214,000
Basic earnings per share1.711.06
(b)Diluted earnings per share are calculated by dividing consolidated net profit attributable to ordinary shareholders of the parent company adjusted based on the dilutive potential ordinary shares by the adjusted weighted average number of outstanding ordinary shares of the Company. As there were no dilutive potential ordinary shares in 2023 (2022: Nil), diluted earnings per share equalled to basic earnings per share.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(58)Notes to the cash flow statement
The Group does not present cash flows on a net basis, and the significant cash flow items are presented as follows:
(a)Cash received relating to other operating activities
20232022
Government grants570,888,569955,101,654
Guarantees55,489,35960,562,160
Others26,712,62433,097,597
653,090,5521,048,761,411
(b)Cash paid relating to other operating activities
20232022
Research and development expenses749,170,775816,368,325
Promotion expenses480,783,867476,208,872
Warranties346,082,383394,991,987
Advertising expenses169,899,863173,112,926
Maintenance expenses89,032,38783,223,085
Consulting fees65,342,13055,227,003
Trademark royalties59,191,20164,658,976
Guarantees39,706,11078,907,867
Others531,422,650533,553,375
2,530,631,3662,676,252,416
(c)Cash received from disposal of investments
20232022
Cash receipts on maturity from structural deposits300,000,000200,000,000
(d)Cash paid to acquire investments
20232022
Cash paid to purchase structural deposits500,000,000100,000,000

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(58)Notes to the cash flow statement (Cont’d)
(e)Cash received relating to other investing activities
20232022
Interest from cash at bank236,531,137213,506,326
Other interest17,591,39517,774,117
254,122,532231,280,443
(f)Cash paid relating to other financing activities
20232022
Payment of deposit on a bank acceptance bill700,000,000-
Payments of lease liabilities35,327,44318,852,333
Others203,835127,976
735,531,27818,980,309
(59)Supplementary information to the cash flow statement
(a)Supplementary information to the cash flow statement
Reconciliation from net profit to cash flows from operating activities
20232022
Net profit1,064,494,697862,878,619
Add: Asset impairment losses (Note 4(48))345,125,5587,242,768
Credit impairment losses (Note 4(49))5,964,48312,066,846
Depreciation of fixed assets (Note 4(14))916,013,071906,176,838
Amortisation of intangible assets (Note 4(17))303,459,508199,424,503
Depreciation of right-of-use assets (Note 4(16))82,225,67470,119,650
Losses/(Gains) on disposal of long-term assets7,453,268(389,251,475)
Financial income(206,132,603)(164,683,747)
Investment loss (Note 4(51))10,579,04636,082,647
Losses/(Gains) on changes in fair value (Note 4(52))2,827,127(13,434,988)
Increase in deferred tax assets(225,776,111)(18,386,505)
Decrease in deferred tax liabilities(4,048,469)(695,186)
Decrease/(Increase) in inventories356,811,018(324,847,715)
Increase in provisions46,435,78036,427,494
Decrease/(Increase) in operating receivables1,243,438,837(2,216,547,690)
Increase/(Decrease) in operating payables639,523,406(521,146,011)
Increase in other cash and cash equivalents(20,854,424)-
Net cash flows from/(used in) operating activities4,567,539,866(1,518,573,952)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(59)Supplementary information to the cash flow statement (Cont’d)
(a)Supplementary information to the cash flow statement (Cont’d)
Net increase/(decrease) in cash and cash equivalents
20232022
Cash and cash equivalents at the end of the year11,746,518,6158,543,193,654
Less: Cash and cash equivalents at the beginning of the year(8,543,193,654)(9,569,051,314)
Net increase/(decrease) in cash and cash equivalents3,203,324,961(1,025,857,660)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(59)Supplementary information to the cash flow statement (Cont’d)
(b)Changes in liabilities arising from financing activities
Bank borrowings (including the current portion)Other accounts payable (including the current portion)Lease liabilities (including the current portion)Others (including the current portion)Total
31 December 20221,121,314,1286,469,701265,315,036-1,393,098,865
Cash inflows from financing activities4,278,854,833--749,000,0005,027,854,833
Cash outflows from financing activities(4,117,072,291)(367,307,955)(35,327,443)(700,203,835)(5,219,911,524)
Interest accrued in the current year31,569,172182,31010,093,308-41,844,790
Dividends accrued in the current year-366,002,736--366,002,736
Changes that do not involve cash receipts and payments39,3211,121,722(22,004,809)203,835(20,639,931)
31 December 20231,314,705,1636,468,514218,076,09249,000,0001,588,249,769

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

4Notes to the consolidated financial statements (Cont’d)
(59)Supplementary information to the cash flow statement (Cont’d)
(c)Cash and cash equivalents
31 December 202331 December 2022
Cash at bank available for payment at any time10,653,646,8117,656,947,735
Cash at finance company available for payment at any time1,092,871,804886,245,919
11,746,518,6158,543,193,654
(i)As in Note 4(1), other cash and cash equivalents of RMB20,854,424 as at 31 December 2023(31 December 2022: Nil) was not included in cash and cash equivalents.
(60)Foreign currency monetary items
31 December 2023
Amounts in foreign currenciesTranslation exchange rateAmounts in RMB
Long-term borrowings -
USD261,9377.08271,855,219
Other payables -
USD20,292,5067.0827143,725,731
EUR33,2887.8592261,617
143,987,348

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

5Equity in other entities
(1)Equity in subsidiaries
Structure of the Group
SubsidiariesMain place of businessPlace of registrationRegistered capitalNature of businessShareholding (%)Method of acquisition
DirectIndirect
JMCSNanchang, JiangxiNanchang, Jiangxi50,000,000Retail, wholesale and lease of automobiles100%-Set up by investment
JMCHTaiyuan, ShanxiTaiyuan, Shanxi1,323,793,174Manufacture and sales of automobiles100%-Business combinations involving enterprises not under common control
SZFJShenzhen, GuangdongShenzhen, Guangdong10,000,000Retail, wholesale and lease of automobiles100%-Set up by investment
GZFJGuangzhou, GuangdongGuangzhou, Guangdong10,000,000Retail, wholesale and lease of automobiles100%-Set up by investment
Jiangling Ford (Shanghai)(a)ShanghaiShanghai200,000,000Sales of automobiles, technical and business information consultation51%-Set up by investment

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

5Equity in other entities (Cont’d)
(1)Equity in subsidiaries (Cont’d)
(a)Subsidiaries with significant minority interests
The Group determines the subsidiaries with significant minority interests by taking into account whether the subsidiaries are listed companies, the proportion of minority interests in the Group’s consolidated shareholders’ equity, and the proportion of profit or loss attributable to minority shareholders in the Group’s consolidated net profit, as follows:
SubsidiariesShareholding of minority shareholdersTotal profit or loss attributable to minority shareholders for the year ended 31 December 2023Dividends paid to minority shareholders for the year ended 31 December 2023Minority interests as at 31 December 2023
Jiangling Ford (Shanghai)49%(411,102,569)-(365,273,118)
Key financial information of the above significant non-wholly owned subsidiaries is presented below.
31 December 2023
Current assetsNon-current assetsTotal assetsCurrent liabilitiesNon-current liabilitiesTotal liabilities
Jiangling Ford (Shanghai)614,328,924334,081,469948,410,3931,687,054,5316,811,2041,693,865,735
2023
RevenueNet lossTotal comprehensive lossCash flows from operating activities
Jiangling Ford (Shanghai)643,047,862(838,984,834)(838,984,834)366,124,545

As of 31 December 2023, the Company and Ford Motor Company (“Ford”) have paid RMB102,000,000 and RMB98,000,000 respectively.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

5Equity in other entities (Cont’d)
(2)Equity in associates
(a)General information of significant associates
The Group determines the significant joint ventures and associates by taking into account factors such as whether the joint ventures and associates are listed companies, the proportion of their carrying amounts to the Group’s consolidated total assets, and the proportion of the investment income from long-term equity investments under equity method to the Group’s consolidated net profit, as set out below:
Place of registrationShareholding (%)
DirectIndirect
Associate -
The Power CompanyTaiyuan, Shanxi40%-
(b)Summarised financial information for significant associates
31 December 202331 December 2022
The Power CompanyThe Power Company
Current assets194,206,175194,926,320
Non-current assets443,606,551426,146,460
Total assets637,812,726621,072,780
Current liabilities147,988,407107,387,068
Non-current liabilities74,039152,778
Total liabilities148,062,446107,539,846
Minority interests195,900,112205,413,174
Equity attributable to shareholders of the parent company293,850,168308,119,760
Share of net assets based on shareholding (i)195,900,112205,413,174
Adjustments
- Unrealised profits arising from internal transactions(14,425,830)(15,210,808)
- Others (ii)20,853,32320,853,323
Carrying amount of equity investments in associates202,327,605211,055,689

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

5Equity in other entities (Cont’d)
(2)Equity in associates (Cont’d)
(b)Summarised financial information for significant associates (Cont’d)
20232022
The Power CompanyThe Power Company
Revenue52,305,02492,711,191
Net loss(29,383,136)(26,440,535)
Other comprehensive income--
Total comprehensive loss(29,383,136)(26,440,535)
Dividends received from associates by the Group--
(i)The Group calculated the shares of net assets in proportion of the shareholdings and based on the amount attributable to the parent company of the associates in their consolidated financial statements. The amount in the consolidated financial statements of associates considers the fair value of identifiable assets and liabilities at the time of acquisition of the investments and the impact of adjustments to uniform accounting policies. None of the assets involved in transactions between the Group and associates contribute to business.
(ii)Other adjustments were mainly the remeasurement of fair value of remaining equity in the consolidated financial statements, which resulted from the loss of control over the original subsidiary due to the disposal of part of the equity investment.
(c)Summarised information of insignificant associates
20232022
Aggregated carrying amount of investments31,470,74337,427,133
Aggregate of the following items based on shareholding
Net (loss)/profit (i)(863,034)1,018,493
Other comprehensive income (i)--
Total comprehensive (loss)/income(863,034)1,018,493
(i)Net profit and other comprehensive income have taken into account the fair value of identifiable assets and liabilities at the time of acquisition of the investments and the impact of adjustments to uniform accounting policies.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

6Segment information
Revenue and profits of the Group mainly arise from production and domestic sales of automobiles, and the primary assets of the Group are all located in China. Management of the Group assesses the operating performance of the Group as a whole. Therefore, no segment report is prepared for the current year. In 2023, the revenue obtained from a single customer of the Group accounted for more than 10% of the Group’s revenue, amounting to RMB9,207,385,268, or 27.76% (2022: 19.62% ), of the Group’s revenue.
7Related parties and related party transactions
(1)Information of major shareholders
(a)General information of major shareholders
Type of enterprisePlace of registrationLegal representativeNature of businessCode of organisation
JICState-owned enterpriseNanchang, ChinaQiu TiangaoInvestment and asset management91360125MA38LUR91F
FordForeign enterpriseUnited StatesWilliam Clay Ford, Jr.Manufacture and sales of automobilesN/A
(b)Registered capital and changes in major shareholders
31 December 2022Increase in the current yearDecrease in the current year31 December 2023
JIC1,000,000,000--1,000,000,000
FordUSD 42,000,000--USD 42,000,000
(c)The percentages of shareholding and voting rights in the Company held by major shareholders
31 December 202331 December 2022
Shareholding (%)Voting rights (%)Shareholding (%)Voting rights (%)
JIC41.03%41.03%41.03%41.03%
Ford32%32%32%32%
(2)Information of subsidiaries
The general information and other related information of subsidiaries are set out in Note 5(1).
(3)Information of associates
The information of associates is set out in Note 4(13).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

7Related parties and related party transactions (Cont’d)
(4)Information of other related parties
Relationship with the Group
JMCGShareholder of JIC
Chongqing Changan Automobile Co., Ltd.(hereinafter referred to as “Chongqing Changan”)Shareholder of JIC
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd.Wholly-owned Subsidiary of JMCG
Jiangxi Lingrui Recycling Resources Development CorporationWholly-owned Subsidiary of JMCG
Jiangling Automobile Group (Nanchang) Fushan Energy Co., Ltd.Wholly-owned Subsidiary of JMCG
Jiangxi JMCG Industry Co., Ltd.Wholly-owned Subsidiary of JMCG
JMCG Property Management Co.Wholly-owned Subsidiary of JMCG
JMCG Jingma Motors Co., Ltd.Wholly-owned Subsidiary of JMCG
Nanchang Gear Forging Co.,Ltd.Wholly-owned Subsidiary of JMCG
Jiangxi Jiangling Chassis Co., Ltd.Holding Subsidiary of JMCG
Nanchang JMCG Shishun Logistics Co., Ltd.Holding Subsidiary of JMCG
Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd.Holding Subsidiary of JMCG
Jiangxi Mingfang Auto Parts Industry Co., Ltd.Holding Subsidiary of JMCG
JMCFHolding Subsidiary of JMCG
Nanchang Jiangling HuaXiang Auto Components Co., Ltd.Holding Subsidiary of JMCG
Jiangxi Jiangling Lear Interior System Co., Ltd.Holding Subsidiary of JMCG
Nanchang Unistar Electric & Electronics Co., Ltd.Holding Subsidiary of JMCG
Jiangxi ISUZU Engine Co., Ltd.Holding Subsidiary of JMCG
Jiangxi ISUZU Co., Ltd.Holding Subsidiary of JMCG
Jiangxi JMCG Specialty Vehicles Co., Ltd.Holding Subsidiary of JMCG
Jiangling Motor Electricity Vehicle Co., Ltd.Holding Subsidiary of JMCG
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd.Holding Subsidiary of JMCG
Ford Motor Co. Thailand Ltd.Wholly-owned Subsidiary of Ford
Ford Global Technologies,LLCWholly-owned Subsidiary of Ford
Ford Motor Research & Engineering (Nanjing) Co., Ltd.Wholly-owned Subsidiary of Ford
Ford Motor (China) Co., Ltd.Wholly-owned Subsidiary of Ford
Ford Trading Company, LLCWholly-owned Subsidiary of Ford
Auto Alliance (Thailand) Co., Ltd.Holding Subsidiary of Ford
Ford Otomotiv Sanayi A.S.Holding Subsidiary of Ford
Ford Vietnam LimitedHolding Subsidiary of Ford
Changan Ford Automobile Co., Ltd.Joint venture of Ford
Jiangling Material Co., Ltd.Subsidiary under indirect control of JMCG
Jiangxi Jiangling group Fuxin Auto Parts Co., Ltd.Subsidiary under indirect control of JMCG
Nanchang JMCG Xinchen Auto Component Co., Ltd.Subsidiary under indirect control of JMCG
Nanchang JMCG Liancheng Auto Component Co., Ltd.Subsidiary under indirect control of JMCG
Nanchang Lianda Machinery Co., Ltd.Subsidiary under indirect control of JMCG
Jiangxi JMCG Boya brake system Co., Ltd.Subsidiary under indirect control of JMCG
Jiangling Aowei Automobile Spare Part Co., Ltd.Subsidiary under indirect control of JMCG
Jiangxi JMCG Shangrao Industrial Co.,Ltd.Subsidiary under indirect control of JMCG
JMCG Jiangxi Engineering Construction Co., Ltd.Subsidiary under indirect control of JMCG
Jiangxi Zhonglian Intelligent Logistics Co., Ltd.Subsidiary under indirect control of JMCG
Nanchang Hengou Industry Co., Ltd.Subsidiary under indirect control of JMCG
Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd.Subsidiary under indirect control of JMCG
Jiangxi JMCG Motorhome Co.,Ltd.Subsidiary under indirect control of JMCG
China Changan Group Tianjin Sales Co., Ltd.Group Subsidiary of Chongqing Changan
Chongqing Anfu Vehicle Marketing Co., Ltd.Group Subsidiary of Chongqing Changan
Guizhou Wanfu Vehicle Sales & Service Co., Ltd.Group Subsidiary of Chongqing Changan

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

7Related parties and related party transactions (Cont’d)
(4)Information of other related parties (Cont'd)
Relationship with the Group
Beijing Baiwang Changfu Vehicle Sales & Service Co., Ltd.Group Subsidiary of Chongqing Changan
Chengdu Wanxing Vehicle Sales & Service Co., Ltd.Group Subsidiary of Chongqing Changan
Dali Wanfu Vehicle Sales & Service Co., Ltd.Group Subsidiary of Chongqing Changan
Guizhou Wanjia Automobile Sales and Service Co. LTDGroup Subsidiary of Chongqing Changan
Beijing Beifang Changfu Vehicle Sales & Service Co., Ltd.Group Subsidiary of Chongqing Changan
Chongqing Anbo Vehicle Sales Co., Ltd.Group Subsidiary of Chongqing Changan
Nanchang Yinlun Heat-exchanger Co., Ltd.Joint venture of JMCG
Dibao transportation equipment (Nanchang) Co., LtdAssociate of JMCG
Magna PT Powertrain (Jiangxi) Co., Ltd.Associate of JMCG
Nanchang Baojiang Steel Processing Distribution Co., Ltd.Associate of JMCG
Faurecia Emissions Control Technologies (Nanchang) Co., Ltd.Associate of JMCG
Jiangxi Lingyun Automobile Industry Technology Co., LtdAssociate of JMCG
Nanchang JMCG SMR Huaxiang Mirror Co., Ltd.Associate of JMCG
Jiangxi Jiangling Group Special Vehicle Co., Ltd.Associate of JMCG
Jiangling Motor Holdings Co., Ltd.Associate of JMCG

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

7Related parties and related party transactions (Cont’d)
(5)Related party transactions
(a)Purchase and sales of goods, provision and receipt of services
Purchase of goods:
Nature of related party transactions20232022
Magna PT Powertrain (Jiangxi) Co., Ltd.Purchase of automobile parts1,234,830,816893,746,762
Nanchang Jiangling HuaXiang Auto Components Co., Ltd.Purchase of automobile parts1,073,623,228924,968,624
Nanchang Baojiang Steel Processing Distribution Co., Ltd.Purchase of raw and auxiliary materials742,956,579853,482,030
Jiangxi Jiangling Lear Interior System Co., Ltd.Purchase of automobile parts739,454,498592,001,464
Jiangxi Zhonglian Intelligent Logistics Co., Ltd.Purchase of automobile parts676,134,340591,833,347
Jiangxi Jiangling Chassis Co., Ltd.Purchase of automobile parts671,593,708667,746,553
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd.Purchase of automobile parts502,323,040522,742,154
Nanchang JMCG Liancheng Auto Component Co., Ltd.Purchase of automobile parts330,845,695369,597,043
Faurecia Emissions Control Technologies (Nanchang) Co., Ltd.Purchase of automobile parts318,072,152463,742,380
Nanchang Unistar Electric & Electronics Co., Ltd.Purchase of automobile parts279,622,115324,877,090
FordPurchase of automobile parts209,574,211322,131,155
Jiangxi Lingyun Automobile Industry Technology Co., LtdPurchase of automobile parts196,007,909103,896,591
Nanchang JMCG Shishun Logistics Co., Ltd.Purchase of automobile parts192,633,046180,558,765
Hanon SystemsPurchase of automobile parts145,092,844158,047,018
Nanchang JMCG SMR Huaxiang Mirror Co., Ltd.Purchase of automobile parts115,360,810101,065,187
Nanchang Yinlun Heat-exchanger Co., Ltd.Purchase of automobile parts115,311,831102,105,085
Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd.Purchase of automobile parts69,811,81577,843,750
Dibao Transportation Equipment (Nanchang) Co., Ltd.Purchase of automobile parts60,792,52072,666,598
Nanchang Lianda Machinery Co., Ltd.Purchase of automobile parts36,590,31141,535,015

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

7Related parties and related party transactions (Cont’d)
(5)Related party transactions (Cont’d)
(a)Purchase and sales of goods, provision and receipt of services (Cont’d)
Purchase of goods (Cont’d):
Nature of related party transactions20232022
Jiangxi Jiangling Group Special Vehicle Co., Ltd.Purchase of automobile parts35,254,36135,235,246
Jiangxi Lingrui Recycling Resources Development CorporationPurchase of raw and auxiliary materials34,228,19821,762,663
Changan Ford Automobile Co., Ltd.Purchase of automobile parts29,984,49241,230,580
Jiangxi JMCG Specialty Vehicles Co., Ltd.Purchase of automobile parts29,236,53128,779,924
Auto Alliance (Thailand) Company LimitedPurchase of automobile parts23,272,01732,471,122
Jiangling Automobile Group (Nanchang) Fushan Energy Co., Ltd.Purchase of raw and auxiliary materials21,306,073-
Jiangxi JMCG Boya brake system Co., Ltd.Purchase of automobile parts21,152,86819,380,235
Jiangxi Jiangling Group Fuxin Auto Parts Co., Ltd.Purchase of automobile parts12,877,79511,199,030
Jiangling Aowei Automobile Spare Part Co., Ltd.Purchase of automobile parts11,810,46010,490,081
Jiangxi Mingfang Auto Parts Industry Co., Ltd.Purchase of automobile parts10,792,5935,568,158
Jiangling Material Co., Ltd.Purchase of raw and auxiliary materials9,453,36832,216,397
Nanchang JMCG Xinchen Auto Component Co., Ltd.Purchase of automobile parts6,916,7346,378,562
Ford Otomotiv Sanayi A.S.Purchase of automobile parts6,124,70611,853,176
Jiangxi ISUZU Engine Co., Ltd.Purchase of automobile parts5,902,03615,633,287
JMCGPurchase of automobile parts5,567,40188,653,236
Ford Motor Co. Thailand Ltd.Purchase of automobile parts5,025,6993,277,641
Jiangling Motor Holdings Co., Ltd.Purchase of automobile parts4,416,53317,697,962
Jiangxi JMCG Shangrao Industrial Co.,Ltd.Purchase of automobile parts3,640,870961,843
Nanchang Gear Forging Co., Ltd.Purchase of automobile parts1,700,9553,004,555
The Power CompanyPurchase of automobile parts889,69312,857,369
Nanchang Hengou Industry Co., Ltd.Purchase of automobile parts808,5613,423,048
Other related partiesPurchase of automobile parts974,5911,140,326
7,991,968,0037,767,801,052

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

7Related parties and related party transactions (Cont’d)
(5)Related party transactions (Cont’d)
(a)Purchase and sales of goods, provision and receipt of services (Cont’d)
Purchase of goods (Cont’d):
The products purchased by the Group from related parties are divided into two categories: purchase of imported parts and purchase of domestic parts. ? The pricing on imported parts purchased from Ford or its suppliers is based on the agreed price by both parties; ? The pricing on domestic accessories purchased from other related parties is determined through quotation, cost accounting, and negotiation between the two parties, and is adjusted regularly.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

7Related parties and related party transactions (Cont’d)
(5)Related party transactions (Cont’d)
(a)Purchase and sales of goods, provision and receipt of services (Cont’d)
Receipt of services:
Nature of related party transactions20232022
Nanchang JMCG Shishun Logistics Co., Ltd.Transportation, cartage fees, etc.279,310,486298,629,305
Ford Global Technologies, LLCTrademark management fees, technology development230,160,051246,334,027
Ford Motor Research & Engineering (Nanjing) Co., Ltd.Design fees, personnel costs194,494,77614,496,038
Jiangxi Zhonglian Intelligent Logistics Co., Ltd.Cartage fees, storage fees, etc.80,922,76730,384,153
FordTechnical services and personnel costs54,350,740204,118,407
Ford Motor (China) Co., Ltd.Design fees, personnel costs, etc.59,693,17521,474,039
Jiangxi JMCG Industry Co., Ltd.Meal fees32,267,14624,868,735
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd.Agency fees, advertising fees, etc.16,523,69815,899,222
JMCG Jiangxi Engineering Construction Co., Ltd.Engineering construction15,415,319-
JMCG Property Management Co., Ltd.Property fees, etc.10,527,9904,362,127
Ford Otomotiv Sanayi A.S.Technical services and technical development7,096,98615,125,422
JMCGLabour costs, rental fees, etc.4,843,4551,492,519
Changan Ford Automobile Co., Ltd.Service fees, labour costs, etc.4,654,2278,263,784
Magna PT Powertrain (Jiangxi) Co., Ltd.Design fees, experimental costs2,418,126-
Chongqing Changan.Personnel costs2,394,3502,458,047
China Changan Group Tianjin Sales Co., Ltd.Warranty and promotion expenses2,172,5131,202,470
Chongqing Anfu Vehicle Marketing Co., Ltd.Warranty and promotion expenses1,941,4361,168,824
Guizhou Wanfu Vehicle Sales & Service Co., Ltd.Warranty and promotion expenses1,821,9521,276,480
Beijing Baiwang Changfu Vehicle Sales & Service Co., Ltd.Warranty and promotion expenses1,471,7687,850
Chengdu Wanxing Vehicle Sales & Service Co., Ltd.Warranty and promotion expenses1,375,9791,203,126
Dali Wanfu Vehicle Sales & Service Co., Ltd.Warranty and promotion expenses1,112,059940,958

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

7Related parties and related party transactions (Cont’d)
(5)Related party transactions (Cont’d)
(a)Purchase and sales of goods, provision and receipt of services (Cont’d)
Receipt of services (Cont’d):
Nature of related party transactions20232022
Nanchang Jiangling HuaXiang Auto Components Co., Ltd.Repair Expense1,000,000-
The Power CompanyConsulting fees-4,109,652
Jiangling Motor Holdings Co., Ltd.Labour costs, rental fees-2,021,395
Other related parties5,948,8006,778,331
1,011,917,799906,614,911
The Group’s pricing on services received from related parties is based on the agreed price by both parties.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023

(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]

7Related parties and related party transactions (Cont’d)
(5)Related party transactions (Cont’d)
(a)Purchase and sales of goods, provision and receipt of services (Cont’d)
Sales of goods and provision of services:
Nature of related party transactions20232022
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd.Sales of vehicles and accessories, etc.9,195,254,3095,898,939,789
Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd.Sales of vehicles, etc.233,284,195472,883,971
JMCG Jingma Motors Co., Ltd.Sales of vehicles and accessories138,140,66771,361,087
Jiangxi JMCG Specialty Vehicles Co., Ltd.Sales of vehicles and accessories117,122,584104,259,399
Jiangxi Lingrui Recycling Resources Development CorporationSales of waste materials, etc.61,983,82869,766,263
Chongqing Anfu Vehicle Marketing Co., Ltd.Sales of vehicles and accessories59,076,55551,437,264
Guizhou Wanfu Vehicle Sales & Service Co., Ltd.Sales of vehicles and accessories57,023,95747,550,057
China Changan Group Tianjin Sales Co., Ltd.Sales of vehicles and accessories53,741,15945,104,628
Chengdu Wanxing Vehicle Sales & Service Co., Ltd.Sales of vehicles and accessories52,044,606