Since the beginning of 2017, our BMW Brilliance joint venture (“BBA”) has been working diligently to roll out new production capacity and launch new pipeline models. The capacity expansion project at the Dadong plant was completed in May, to prepare for production of the brand new 5-series which was launched to the market in June 2017. Together with the Tiexi plant, BBA has reached total annual production capacity of over 500,000 units providing for products of different architectures and drivetrains. The new 5-series embeds cutting-edge innovations and class-leading driving dynamics, and has received raving market reviews and extremely positive customer response since launch. In addition to the 5-series, in March 2017 BBA has also introduced the brand new BMW 1-series sedan. This new addition represents the fifth locally produced BMW product for BBA, and the first that is solely catered for the Chinese market. The new launches contributed to the newly added volume during the year. Alongside these new launches, sales volume of our X1, 2-series and 3-series also increased during the period. As a result, BBA achieved sales of 386,549 BMW vehicles in the year 2017, representing an increase of 24.7% when compared to the previous year

BBA has continued with expansion of its dealer network which had reached 506 full service 4S shops nationwide as at 31st December, 2017. It continues to work closely with its sales organisation on all fronts in an effort to sustain the profitability of both BBA and its dealers. Various aspects of digitalisation, such as aggregation of channels, enabling of additional online activities and further integration of digital services are being rolled out in China. Furthermore, the brand new Shanghai BMW Brand Experience Centre opened in March also provides Chinese consumers with unprecedented brand experiences. BBA’s sales activities also continue to be supported by the BMW auto finance company which has been performing extremely well and contributing increasing profits to BBA.

Brilliance continues to be confident about the long-term growth prospects of the Chinese premium auto industry. We believe the new products to be introduced by BBA over the next few years will have strong customer appeal, and will broaden and better tailor our product portfolio to meet Chinese consumers’ preferences. The brand new X3 sport activity vehicle (“SAV”), another new BMW model and the sixth one to be localised within BBA, will come to market later this year. The new X3 will be a key product which will bolster the competitiveness of BBA’s product offerings in China. Furthermore, the company is also actively finalising its new energy vehicle strategy and product lineup for the next few years to properly position itself for participation in this rapidly growing sector in China. BBA’s model pipeline will be enriched with the addition of new battery electric variants over the next few years. In order to support growth in the new energy area, BBA opened a new high voltage battery factory in its engine plant in October 2017 which is the first battery factory operated by a premium automobile manufacturer in China. In addition to the above, the topics of further capacity expansion, cost control, dealer management, component localisation, new regulation, and further integration of BBA into the BMW network via potential exports of vehicles and components from China will all remain key focus areas for BBA’s ongoing operation.

As for our minibus business, the Group reached agreement at the end of 2017 to bring in Renault SAS (“Renault”) as a shareholder and joint venture partner in our minibus operating subsidiary. The company has been renamed Renault Brilliance Jinbei Automotive Co., Ltd. (“RBJAC”), and the cooperation with Renault marks a crucial strategic move and an important step for the company to turn around our existing minibus operation, as well as cultivate the full potential of the light commercial vehicle (“LCV”) market in China by utilising the joint expertise and knowhow of the two shareholders. During the short period since RBJAC’s formation, a new senior management team has already been put in place and tasked to formulate both an immediate and mid-range business plan for the company. Although we expect RBJAC to continue to contribute negative earnings to the Group in 2018, our aim is to craft a concrete plan for existing product revamp, immediate cost reduction, sales overhaul, and new product pipeline so as to reduce losses year-on-year and ultimately returning to profitability.

Brilliance-BEA Auto Finance Co., Ltd. (“BBAFC”), the Company’s auto finance subsidiary in China, had once again achieved profitability in 2017. In addition to supporting Huachen Group and RBJAC’s sales of their sport utility vehicles (“SUV”), sedans, minibuses and multi-purpose vehicles (“MPV”), the company has also successfully extended its business with Jaguar Land Rover (“JLR”) to finance their customers and dealers. At the end of 2017, BBAFC had a network coverage of more than 200 dealers with JLR, paving the way to strong future growth. Moreover, BBAFC has also established a new cooperation with TESLA, thus increasing the company’s footprint in the fast-growing electric vehicle market in China.

The remaining months of 2018 will continue to be very challenging for the Group. Maintaining the prominent position of BBA in the premium auto market, executing renewed strategies for the turnaround of RBJAC with Renault as our new partner, and driving for additional businesses and profits for BBAFC, will all remain the Group’s business priorities. Apart from that, the Group also continues to look for new business opportunities as well as ways to further streamline its existing operation and corporate structure to support its business growth.

於二零一七年，中國經濟增長持續強勁，國內生產總值較去年增加6.9%。中國汽車工業協會資料顯示，於二零一七年，中國汽車總銷量上升3.0%至28,880,000輛。其中，乘用車佔24,720,000輛，僅微升1.4%，升幅受小型發動機汽車於二零一六年底之購買量推動所致。然而，受惠於新產品推售及消費意欲復甦有利奢侈品銷售，豪華乘用車銷售於二零一七年之增長大幅超越整體乘用車市場的增長，約達17%。

自二零一七年初以來，華晨寶馬合資企業（「華晨寶馬」）一直努力推動新產能提升及推出未來一系列的型號。大東廠房之產能擴展計劃已於五月完成，以備生產於二零一七年六月推出市場之全新5系產品。連同鐵西廠房，華晨寶馬之總年產能超過500,000輛，提供不同結構及傳動系統之產品。全新5系產品具備先進之創新技術及領先之駕駛性能，自產品推出以來，獲得市場好評如潮及非常正面之客戶回饋。除5系產品外，於二零一七年三月，華晨寶馬亦已推出全新寶馬1系轎車。此新產品為華晨寶馬於國內生產之第五款寶馬產品，乃首次專為中國市場而設。新發佈項目佔年內銷量增加之其中一部分。除上述新發佈項目外，X1、2系及3系於期內之銷售量亦有所上升。因此，華晨寶馬於二零一七年售出386,549輛寶馬汽車，較去年增加24.7%。

華晨寶馬持續擴展其經銷網絡，於二零一七年十二月三十一日在全國擁有達506間全方位服務4S店舖。華晨寶馬在各範疇與其銷售組織保持緊密合作，以維持其及其經銷商之盈利能力。中國正在推出各項數碼化服務，如渠道匯集、更多線上活動的衍生及數碼化服務的進一步整合。此外，隨著上海華晨寶馬全新的品牌體驗中心於三月開幕，中國消費者可感受前所未有的品牌體驗。華晨寶馬的銷售活動亦將繼續獲得寶馬汽車金融公司的支持，其表現一貫出色，使華晨寶馬的盈利不斷上升。

華晨對中國豪華汽車行業長遠發展前景依然抱有信心，並相信未來數年華晨寶馬推出的新產品將廣受客戶愛戴，亦可擴大及優化我們的產品組合，更能迎合中國消費者的喜好。全新的X3運動型多功能車（「SAV」）為寶馬另一新型號，並為華晨寶馬的第六款國產型號，將於年底面世。全新的X3將為重點產品，可有助提升華晨寶馬的產品組合於中國的競爭力。此外，公司亦正積極落實新能源汽車策略及於未來數年之產品陣容，以為發展此項於中國高速增長之業務作好適當準備。各種嶄新之電動車將於未來數年面世，豐富了華晨寶馬之車款陣容。為支援新能源範疇之發展，華晨寶馬於二零一七年十月在其發動機廠房新設立一間高伏特電池製造廠。該製造廠為中國豪華汽車製造商營運的首間電池製造廠。除此之外，進一步擴充產能、控制成本、經銷商管理、零部件國產化、新法規及華晨寶馬透過中國潛在汽車及零部件出口以進一步融入寶馬網絡等範疇，仍將繼續是華晨寶馬未來運營的重點關注領域。

就輕型客車業務而言，本集團於二零一七年底達成協議，引入Renault SAS（「雷諾」）作為輕型客車營運附屬公司之股東及合資企業合作夥伴。該公司的名稱已變更為華晨雷諾金杯汽車有限公司（「華晨雷諾」），而與雷諾合作為重要之策略舉措，並為公司將現有輕型客車業務轉虧為盈之重要一步，且可透過運用兩名股東之共同經驗及專業知識全面發掘中國輕型商用車（「LCV」）市場之潛力。華晨雷諾成立後不久，全新的高級管理層團隊已經組成，並協助制訂公司的短期及中期業務規劃。儘管我們預期華晨雷諾於二零一八年仍未能為本集團帶來正面盈利，惟我們的目標為就現有產品升級、即時削減成本、銷售改革及新產品陣容訂立具體計劃，從而逐年減少虧損，最終獲得盈利。

本公司於中國之汽車金融附屬公司華晨東亞汽車金融有限公司（「華晨東亞汽車金融」）於二零一七年再次錄得盈利。除支持華晨集團及華晨雷諾銷售運動型多用途車（「SUV」）、轎車、輕型客車及多用途汽車（「MPV」）外，該公司亦成功拓展與捷豹路虎（「捷豹路虎」）的業務，為其客戶及經銷商提供融資。於二零一七年底，華晨東亞汽車金融與捷豹路虎擁有超過200名經銷商之業務網絡，為壯大日後發展奠定基礎。此外，華晨東亞汽車金融亦已與TESLA建立新業務合作關係，從而為該公司於中國快速增長的電動車市場開拓據點。

二零一八年餘下月份對本集團而言仍然挑戰重重。維持華晨寶馬於豪華汽車市場之領先地位、與我們的新業務夥伴雷諾開展新策略將華晨雷諾轉虧為盈，及為華晨東亞汽車金融尋覓其他業務及賺取盈利，均繼續為本集團之首要任務。除此之外，本集團亦將繼續物色新商機，並尋求方法進一步精簡現有營運及公司架構，以支持業務增長。