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1、20232023年 度 報 告ANNUAL REPORT股份代號：489Stock Code:4892023ContentsCorporate Profile and Summary of Business2Chairmans Statement5Director Report8Management Discussion and Analysis41Main Work Experience of Directors,Supervisors and Senior Managers of the Issuer49Report of the Supervisory Committee55Corpor

2、ate Governance Report58Independent Auditors Report87Consolidated Income Statement93Consolidated Statement of Comprehensive Income94Consolidated Statement of Financial Position95Consolidated Statement of Changes in Equity98Consolidated Statement of Cash Flows100Notes to the Financial Statements104Fiv

3、e Year Financial Summary227Definitions2282Dongfeng Motor Group Company LimitedCorporate Profile and Summary of BusinessI.CORPORATE INFORMATIONCOMPANY NAMEDongfeng Motor Group Company LimitedREGISTERED ADDRESSSpecial No.1 Dongfeng RoadWuhan Economic and Technology Development Zone Wuhan,HubeiPRCPRINC

4、IPAL PLACE OF BUSINESS IN THE PRCSpecial No.1 Dongfeng RoadWuhan Economic and Technology Development Zone Wuhan,HubeiPRCPRINCIPAL PLACE OF BUSINESS IN HONG KONG5/F,Manulife Place348 Kwun Tong RoadKowloonHong Kong SARAUDITORErnst&YoungCertified Public Accountants andRegistered Public Interest Entity

5、Auditor32023 Annual ReportCorporate Profile and Summary of Business(Continued)II.STOCK PROFILE OF THE COMPANYLISTING DATE7 December 2005PLACE OF LISTINGThe Stock Exchange of Hong Kong Limited(the“Stock Exchange”)STOCK CODE00489TOTAL SHARE CAPITALRMB8,302,252,000(as of 31 December 2023)III.OTHER RELA

6、TED INFORMATION COMPANY WEBSITEJOINT COMPANY SECRETARIESLiao XianzhiYuen Wing Yan,Winnie(FCG,HKFCG(PE)HONG KONG H SHARE REGISTRARComputershare Hong Kong Investor Services Limited Shops 17121716,17th FloorHopewell Centre183 Queens Road East Wan ChaiHong Kong SAR4Dongfeng Motor Group Company LimitedCo

7、rporate Profile and Summary of Business(Continued)IV.BUSINESS SUMMARYDongfeng Motor Group Company Limited(“Dongfeng Motor Group”)was listed on the Hong Kong Stock Exchange on 7 December 2005.The main business of Dongfeng Motor Group encompasses passenger vehicle and commercial vehicle businesses,inc

8、luding whole vehicles,key assemblies,service and other related business,covering various market segments including premium,high-end,mid-end,and entry grade vehicles.Its domestic business operations are primarily concentrated in more than 20 cities across China,such as Wuhan,Shiyan,Xiangyang,Guangzho

9、u,Liuzhou,Zhengzhou,Chengdu,Chongqing,and Dalian.As one of the industry leaders in Chinas automotive market,Dongfeng Motor Group has a complete coverage in passenger vehicle segments,exerting a significant market influence and enjoying high brand awareness.Dongfeng Motor Groups passenger vehicle por

10、tfolio includes proprietary brands such as M-Hero Technology,Yoyah,Dongfeng Fengsheng and Dongfeng Liuqi,as well as joint venture business units such as Dongfeng Nissan and Dongfeng Honda.Additionally,Dongfeng Motor Group has strategically positioned itself in the commercial vehicle sector,boasting

11、a complete industrial chain layout and delivering excellent product performance.It is recognized as a leading manufacturer in the commercial vehicle industry.Within the commercial vehicle segment,Dongfeng Motor Groups operations are primarily concentrated in companies such as Dongfeng Commercial Veh

12、icle Co.,Ltd.,Dongfeng Automobile Co.,Ltd.,Dongfeng Liuzhou Motor Co.,Ltd.,Dongfeng Specialty Vehicle Co.,Ltd.,Zhengzhou Nissan,and others.Dongfeng Motor Groups automotive finance business has enjoyed significant growth momentum,with the entire business process being digitalized to better support th

13、e vehicle business.Currently,the auto finance operations of Dongfeng Motor Group primarily take place within Dongfeng Finance Co.,Ltd.,Dongfeng Motor Finance Co.,Ltd.,Chuangge Financial Leasing Co.,Ltd.,and Dongfeng Nissan Auto Finance Co.,Ltd.In recent years,Dongfeng Motor Group has accelerated the

14、 development of its automotive“LEICS”(lightweight,electric,intelligent,connected,and shared)strategy,which involves establishing a comprehensive layout for new businesses.This includes the branding,platforms,and product layout for proprietary new energy vehicles,as well as the optimization and upgra

15、ding of core resources,with a focus on proprietary brands and the transition to new energy vehicles.The company has successfully industrialized and localized the production of batteries,motors,and electronic controls,and has gained expertise in key technologies and critical resources such as the“Lon

16、gqing”green and low-carbon power brand for commercial vehicles,the“Mach”green and low-carbon power brand for passenger vehicles,IGBT,fuel cell technology,and the entire technical chain associated with them.52023 Annual ReportChairmans StatementDear Shareholders,On behalf of the Board of Directors,I

17、hereby present the 2023 annual report of Dongfeng Motor Group for your review.In 2023,facing the complex situation of accelerated market demand differentiation,deepening competition pattern and increasing challenges,the Group adhered to the main line of transformation and development,and made every

18、effort to promote the transformation from relying on joint ventures to equal emphasis on both joint ventures and independent development,and from focus on fuel-powered vehicles to a balance between energy-saving vehicles and new energy vehicles.The progress met the expectations of transformation and

19、 further strengthened the foundation for corporate development.In 2023,approximately 2,088,200 units of vehicles were sold in this period,representing year-on-year decrease of 15.3%;sales of independent brand passenger cars reached 347,400 units,a decrease of 30.2%year-on-year;sales of commercial ve

20、hicles reached approximately 343,400 units,an increase of 10.3%year-on-year.The Groups sales of new energy vehicles in this period were approximately 348,000 units,accounting for an increase of 2.7 percentage points in the Groups sales,of which,sales of high-end brand VOYAH exceeded 50,000,an increa

21、se of 159.1%year-on-year.Due to the continued decline in market share of non-luxury joint venture passenger cars,the Groups joint venture business achieved sales of 1.3974 million units,of which,Dongfeng Nissans sales decreased by 21.5%year-on-year and Dongfeng Hondas sales decreased by 8.5%year-on-

22、year.The Groups overseas export business maintained a good growth momentum,with export sales of 169,100 units,an increase of 14.3%year-on-year,achieving the best level in history.In this period,the Group achieved sales revenue of RMB99.315 billion,with a net loss attributable to shareholders of list

23、ed companies of RMB3.996 billion.As of the end of 2023,the Group has abundant cash reserves,amounting to more than RMB100 billion.The Group continuously optimize asset structure and operational efficiency.The asset-liability ratio for this period was 51.7%,with a stable asset-liability structure.Ope

24、rating cash flow increased by RMB1.991 billion year-on-year,with an operating cash ratio of 8.61%,steadily increasing operating cash flow.6Dongfeng Motor Group Company LimitedChairmans Statement(Continued)In the face of a very severe situation,the Group focused on the overall goals of the“14th Five-

25、Year Plan”and the Three-Year Action Plan for“Transition Action of technological innovation”,and deepened reform and innovation,accelerating the pace of transformation and upgrading in new energy.We comprehensively completed the layout of new energy brands,platforms,products,and core resources,achiev

26、ing new development in fields such as independent new energy vehicles,control of key core technologies,and deepening reforms,and forming a strategic layout that is significantly better than the era of traditional fuel vehicles.The Group established comprehensive brand layout.In the luxury car market

27、,we have positioned ourselves in the luxury electric off-road brand Dongfeng M HERO,and the first product,M HERO 917,achieved a transaction price of around RMB700,000 and has sold over a thousand units since its launch in September last year.In the high-end car market,Dongfeng VOYAH has completed th

28、ree rounds of product iteration,with a transaction price of around RMB250,000 and sales volume in 2023 have exceeded 50,000 units.For the mainstream consumer market,Dongfeng es first model,e007,was put into mass production and launched to market on March 14 this year.In the entry-level market,the fi

29、rst model of Dongfeng Nammi,the Nammi 01,started deliveries in January this year.Through continuous innovation,we provided strong support for the transformation of new energy.We have built three major platforms for independent passenger cars:the M TECH Luxury Offroad Architecture,the Dongfeng Quantu

30、m Architecture,and the DSMA energy-saving Architecture.In the fields of green energy and intelligence,we have independently mastered technologies and resources such as the“three core e-components”,electronic and electrical architecture,automotive-grade chips,independent controllers,intelligent drivi

31、ng,and fuel cells.We have increased our investment in technology,and the number of new invention patents authorized by the Company remains the highest in the industry.72023 Annual ReportChairmans Statement(Continued)Committed to promoting institutional and mechanism reforms that are in line with our

32、 transformation and upgrading.We have been accelerating the implementation of the three-year transformation and upgrading plan,unwaveringly strengthening and optimizing Dongfengs independent business and new energy vehicles.We have carried out the“PV Transition Action”to manage the three major brand

33、s of Dongfeng Fengshen,Dongfeng e,and Dongfeng Nammi in an integrated manner,and pool the resources of the Group to develop the independent new energy passenger vehicle business.We have implemented the“R&D Transition Action”and established a research and development institute to build a“1+n”research

34、 and development system,focusing on the transformation and upgrading of new energy,deeply integrating the groups research and development system and resources,and comprehensively enhancing research and development efficiency.Furthermore,we have implemented the“CV Transition Action”for Dongfengs comm

35、ercial vehicle business and established a commercial vehicle business unit to operate the commercial vehicle business in an integrated manner across the Group,concentrate superior resources,help boost the commercial vehicle business to fully compete in the new energy era,and create a world-class com

36、mercial vehicle enterprise.The implementation of these measures has achieved significant progress.From January to February this year,the Group sold 331,000 units of vehicles,an increase of 26.2%,achieving a“good start”.Looking ahead,the Group will anchor the goals and tasks of the new mid-term busin

37、ess plan.We will strengthen our mission of“striving for first place and being a good national team”,and make every effort to achieve transformation and breakthroughs,surpassing and leaping forward,and promoting new and greater progress in the Companys operations,in order to assist all shareholders i

38、n achieving value appreciation.Finally,on behalf of the board of directors,I would like to express my sincere gratitude to all shareholders for their continued support and contribution.Yang QingWuhan,the PRC28 March 20248Dongfeng Motor Group Company LimitedDirector ReportI.BUSINESS OVERVIEWDongfeng

39、Motor Group is principally engaged in the businesses of research and development,manufacturing and sales of commercial vehicles,passenger vehicles,engines and other auto parts,automobile equipment manufacturing,import and export of automobile products,logistics services,financing services,insurance

40、agency and used car trading.1.Whole vehicle(1)Passenger vehiclesThe passenger vehicle business of Dongfeng Motor Group is mainly operated in the own business units such as M TECH,VOYAH Automobile,Dongfeng Aeolus and Dongfeng Liuzhou Automobile and the joint venture business units such as Dongfeng Ni

41、ssan and Dongfeng Honda.Dongfeng Motor Group mainly produces and sells 89 series of passenger vehicles,including 32 series of sedans,9 series of MPVs and 48 series of SUVs.The main products include:Dongfeng M HERO 917;Dongfeng VOYAH FREE,DREAM,PASSION;Dongfeng Aeolus Yixuan,Haohan,E70;Dongfeng e007，

42、Dongfeng NAMMI 01;Dongfeng Forthing Lingzhi,T5,Youting;Dongfeng Venucia V-online,V-online DDI,VX6;Dongfeng Nissan Altima,Sylphy,X-Trail,Qashqai,Ariya;Dongfeng Infiniti QX50,QX60;Dongfeng Honda CIVIC,CR-V,XR-V,UR-V,INSPIRE,Elysion and eNS1;Dongfeng Peugeot 408,408X;Dongfeng Citron C5,C5X,e Elysee.920

43、23 Annual ReportDirector Report(Continued)(2)Commercial vehiclesThe commercial vehicle business of Dongfeng Motor Group is mainly operated by Dongfeng Commercial Vehicle Co.,Ltd.,Dongfeng Motor Automobile Co.,Ltd.,Dongfeng Liuzhou Motor Co.,Ltd.,Dongfeng Special Commercial Vehicle Co.,Ltd.and Zhengz

44、hou Nissan Automobile Co.,Ltd.Dongfeng Motor Group mainly produces and sells 27 series of commercial vehicles,including 14 series of heavy-and medium-duty trucks,7 series of light-duty trucks,4 series of pickup trucks and 2 series of buses.The main products include:Dongfeng Kinland,Dongfeng Kingrun,

45、Dongfeng Vasol and Chenglong series products in terms of heavy-and medium-duty trucks;Dongfeng Duolika,Dongfeng Captain,Dongfeng Tuyi,Dongfeng Xiaobawang and Dongfeng Furika series products in terms of light-duty trucks;Rich and Navara series products in terms of pickup trucks;Dongfeng Tianyi and Do

46、ngfeng Yufeng series products in terms of buses.2.New energy vehiclesIn recent years,Dongfeng Motor Group has accelerated the development of its new-energy vehicle business of“LEICS”layout,and by the end of 2023,Dongfeng Motor Group produces and sells 34 kinds of new energy passenger vehicles and 9

47、kinds of new energy commercial vehicles.The main products of new energy passenger vehicles are Dongfeng M HERO 917,Dongfeng VOYAH FREE,DREAM,PASSION;Dongfeng Aeolus SKY EV01,E70;Dongfeng NAMMI BOX;Dongfeng Forthing Lingzhi M5EV,Forthing S50EV,pure electric SUV;Dongfeng Venucia V-online DDI,D60EV,VX6

48、;Dongfeng Nissan Sylphy BEV,Ariya;27 Dongfeng Honda CR-V PHEV,eNS1 and INSPIRE PHEV;Dongfeng Peugeot 4008 PHEV,508L PHEV;Dongfeng Citron C5X PHEV and so on.The main products of new energy commercial vehicles are Dongfeng Kinland,Dongfeng Kingrun,Dongfeng Vasol,Dongfeng Captain,Dongfeng Tuyi,Dongfeng

49、 Tianyi and Dongfeng Yufeng.10Dongfeng Motor Group Company LimitedDirector Report(Continued)3.Production capacityAs at 31 December 2023,the whole vehicle production capacity of Dongfeng Motor Group was approximately 3.98 million units,representing an increase of 0.14 million units as compared to the

50、 end of 2022,mainly attributable to Dongfeng Passenger Vehicle Company.The whole vehicle production capacity of commercial vehicles was approximately 0.62 million units and that of passenger vehicles was approximately 3.36 million units.4.Sales and service channelsAs the new LEICS trend of the autom

51、obile industry continued and market competition deepened and intensified,the changes in both marketing models and channels also continued to deepen.On one hand,Dongfeng Motor Group promoted the transformation and upgrading of sales channels,and enhanced customer operation capacity and improved custo

52、mer satisfaction through digital tools such as APPs and WeChat applets;on the other hand,it also explored new channel models by using the channel of directly-managed stores+eco-stores for the Dongfeng VOYAH.As at 31 December 2023,the Dongfeng Motor Group had a total of 6,027 sales outlets covering 3

53、1 provinces(municipalities and autonomous regions)across the country.5.Financing servicesAs of the date of the announcement,the financing service business of Dongfeng Motor Group is currently operated by the following companies:Dongfeng Auto Finance Co.,Ltd,Dongfeng Motor Finance Co.,Ltd.Dongfeng Ni

54、ssan Auto Finance Co.,Ltd.6.Capital expenditureIn 2023,Dongfeng Motor Group completed a total of actual investment(equity method)amounting to RMB12,487 million,representing an increase of RMB2,995 million,or 32%as compared to the same period last year.The main reasons for the increase were the incre

55、ase in investment in MTECH,e,Nammi and other independent new energy vehicle business,and in“three core e-components”and other products of Intelligent Power System Co.,Ltd.Among them,the capitalization of research and development expenditure and the purchase of intangible assets amounted to about RMB

56、3,711 million,and the fixed assets and other expenditure amounted to about RMB8,776 million.112023 Annual ReportDirector Report(Continued)7.Business OutlookIn 2024,it is expected that the automobile industry will maintain its growth momentum,and continue to accelerate the transformation into new ene

57、rgy and intelligent vehicles.Chinese automobile exports will be facilitated,and the scale of automobile industry in China will rank the first worldwide.In terms of passenger vehicles,it is expected that further policies will be launched at the state level to stimulate the overall consumer market;in

58、terms of commercial vehicles,driven by factors such as demand release from clearing vehicle inventories at the China National Standard 5(CN-5)and the early elimination of vehicles at the China National Standard 4(CN-4),the total industry volume(TIV)of the domestic market will increase,bringing benef

59、its to the overall market.However,the automobile market will still be affected by the global economic downturn,the slow recovery of consumption and confidence,geopolitics and other unfavourable factors.The core competitiveness of Chinas new energy vehicles has been formed and will continue to grow a

60、t a high rate,while the export market will maintain its growth trend but at a lower rate.For the year,31 million units are expected to be sold,representing a year-on-year increase of 3.0%.The sales target of Dongfeng Motor Group in 2024 is 2.7 million units,a year-on-year growth of 29%compared to 20

61、23.With the continuous optimization of the Groups strategic layout,transformation breakthrough,brand upward and other aspects,and the orderly and gradual launching of new models,passenger car sales target is 2.28 million,an increase of 30%.With the acceleration of the integration of the Groups comme

62、rcial vehicle business,the layout of gas vehicles,new energy and high-horsepower models gradually showed strength,and the sales volume of commercial vehicles was targeted at 420,000 units,an increase of 22%year-on-year.12Dongfeng Motor Group Company LimitedDirector Report(Continued)II.SIGNIFICANT EV

63、ENTSProposed final dividendsThe Board did not propose to distribute a final dividend for the year ended 31 December 2023.Material legal proceedingsFor the year ended 31 December 2023,Dongfeng Motor Group was not involved in any material litigation or arbitration and no material litigation or claim w

64、as pending or threatened or made against Dongfeng Motor Group as far as Dongfeng Motor Group was aware.Dividend distribution by the Companys jointly controlled entities(JCEs)In 2023,the Companys JCEs,in total,declared and distributed aggregate dividends of approximately RMB2,349 million to the Compa

65、ny.Although the exact amounts of dividend distributions are not set each year,pursuant to each of the joint venture agreements,distributions are required to be paid out of the profit made by the relevant JCEs(after payments of income tax)in accordance with the relevant PRC law as determined at the m

66、eetings of the Board of Directors of each JCE as being appropriate dividend distributions on the circumstances of each JCE.When determining dividend distributions,the Board of Directors of each JCE will offset losses of previous years and deduct from the profit made by the relevant JCE the portion o

67、f profit to be allocated for applicable legal reserves as required under the PRC laws and regulations and company reserve(including but not limited to amounts allocated to cover the relevant JCEs working capital or to increase capital or expand production),employee bonus and welfare and company deve

68、lopment.Pursuant to each of the joint venture agreements,distributions of profit will be made in proportion to the capital contributions paid by the relevant joint venture party and the Company respectively in accordance with the PRC laws.None of the JCEs has any specific dividend policies other tha

69、n those disclosed above.However,if both the Company and the joint venture partners agree,the JCEs can declare dividends when there are distributable profits.Since dividend distribution is the primary channel for return of investment to the Company and the relevant joint venture partner in respect of

70、 each JCE,in the past,the JCEs have fully paid out all profits for each year after offsetting losses of previous years,after deducting applicable legal reserves as required under the PRC laws and regulations and after allocations were made by each relevant JCE for company reserve(including but not l

71、imited to amounts allocated to cover working capital or to increase capital or expand production).In the future,it is the intention of the Company and the relevant joint venture partner to continue to declare dividends when there are distributable profits for the relevant JCE,subject to agreement be

72、tween the Company and the relevant joint venture partner on the appropriate dividend distributions based on the circumstances of each JCE and pursuant to the provisions of the relevant joint venture agreement and the applicable PRC laws and regulations.132023 Annual ReportDirector Report(Continued)F

73、inancial summaryA summary of the Groups operating results,for the last five years ended 31 December 2023 and the assets and the liabilities of are set out on page 227 in this annual report.Bank loans and other borrowingsDetails of the bank loans and other borrowings of the Group are set out in note

74、31 to the audited financial statements.Property,plant and equipmentChanges in property,plant and equipment of the Group for the year ended 31 December 2023 are set out in note 14 to the audited financial statements.Designated deposits and overdue term depositsAs at 31 December 2023,the Group had no

75、designated deposits and overdue term deposits in any financial or other authorities.ReservesDetails of movements in reserves of the Company and the Group for the year ended 31 December 2023 are set out in note 42 to the audited financial statements and the consolidated statement of changes in equity

76、 on page 98,respectively.Pursuant to Article 155 of the Articles of Association of the Company,if there are material discrepancies between the financial statements prepared in accordance with the accounting standards and regulations in the PRC and the financial statements prepared in accordance with

77、 International Financial Reporting Standards or the accounting standards in other place(s)where the Company is listed,the after-tax profit to be allocated for the relevant accounting period shall be the lower of the after-tax profits in these financial statements.The Board of Directors recommends no

78、 profit distribution for the year 2023,subject to consideration and approval at the annual general meeting to be held on 21 June 2024.14Dongfeng Motor Group Company LimitedDirector Report(Continued)DonationsThe Group has made total donations of approximately RMB11 million for the year ended 31 Decem

79、ber 2023.Major customers and suppliersDuring the year ended 31 December 2023,the revenue attributable to the five largest customers accounted for no more than 30%of the Groups revenue for the year.Subsidiaries,JCEs and other companies in which the company has direct equity interestsAs at 31 December

80、 2023,details of the subsidiaries and JCEs as well as other companies in which the Company has direct equity interests are set out in notes 18,19 and 20 to the audited financial statements for the year respectively.Share capitalAs at 31 December 2023,the aggregate share capital of the Company was RM

81、B8,302,252,000,divided into 8,302,252,000 ordinary shares with a nominal value of RMB1 each,of which 5,760,388,000 were Domestic Shares representing approximately 69.38%of the aggregate number of shares in issue,and 2,541,864,000 were H Shares representing approximately 30.62%of the aggregate number

82、 of shares in issue.Pre-emptive rightsThere are no provisions for pre-emptive rights under the Companys Articles of Association or the laws of the PRC.Purchase,sale or redemption of securities of the CompanyReference is made to the circular of the Company dated 29 May 2023,the Directors believe that

83、 the reason to repurchase of the Companys H Shares is based on the full confidence in the future development of the Company,helps maintain the Companys investment value and the Companys reputation in the capital market,and is also in line with the Companys future development strategy.The Directors a

84、re of the view that the flexibility afforded by the H Share Repurchase Mandate would be beneficial to and in the best interest of the Company and its Shareholders.The relevant resolution had been passed at Annual General Meeting held on 20 June 2023.During the twelve months of 2023,the Company repur

85、chased a total of 313,092,000 H shares on the Stock Exchange of Hong Kong Limited.As at 31 December 2023,the total number of H shares in issue was 2,541,864,000.152023 Annual ReportDirector Report(Continued)Details of the share repurchase are as follows:MonthNumber of the shares repurchasedPurchase

86、price per share(HKD)Total Consideration(before expenses)(HKD)HighestLowestJanuary 20233,800,0004.554.4317,068,780May 202319,250,0003.403.3164,978,400June 202338,850,0004.113.41147,230,580July 202310,220,0003.713.4736,573,001August 20235,240,0002.992.8715,397,356September 202381,440,0003.102.93245,83

87、7,213.20October 202380,204,0003.482.94257,449,523.40November 202351,914,0003.653.45182,742,730.60December 202322,174,0004.013.7385,764,739.00Save as disclosed above,neither the Company nor any of its subsidiaries purchased,sold or redeemed any of the Companys listed securities during the year ended

88、31 December 2023.16Dongfeng Motor Group Company LimitedDirector Report(Continued)Interests of Substantial ShareholdersAs at 31 December 2023,the names and relevant number of shares of the persons who hold 5%or more(Classification of shareholding structure according to domestic shares and H shares)of

89、 the class shares in the issued capital of the Company(other than directors and supervisors),as recorded in the register to be kept by the Company pursuant to Section 336 of the Securities and Futures Ordinance are set out below:Note:(L)Long position,(S)Short Position,(P)Lending PoolNameClass of Sha

90、resNumber of shares heldPercentage in the class of issued share capitalPercentage in the total share capital(%)(%)Dongfeng Motor CorporationDomestic Share5,760,388,000(L)100.00(L)69.38H Share256,742,000(L)10.10(L)3.23Reynolds Margaret(Meg)H Share218,378,654(L)8.59(L)2.63Ward BryanH Share218,378,654(

91、L)8.59(L)2.63Westwood Global Investments,LLCH Share218,378,654(L)8.59(L)2.63Citigroup Inc.H Share153,383,331(L)6.03(L)1.855,246,511(S)0.21(S)0.06151,050,252(P)5.94(P)1.82172023 Annual ReportDirector Report(Continued)Directors,Supervisors and Senior Management of the CompanyDuring the year,the direct

92、ors,supervisors and senior management of the Company include:DirectorsZhu YanfengExecutive Director and Chairman of the Board of Directors (Resigned on 2 November 2023)Yang Qing Executive Director and Chairman of the Board of Directors (Appointed as the Chairman on 2 November 2023)You Zheng Executiv

93、e DirectorHuang Wei Non-executive Director(Resigned on 17 May 2023)Zong Qingsheng Independent Non-executive DirectorLeung Wai Lap,Philip Independent Non-executive DirectorHu Yiguang Independent Non-executive DirectorSenior ManagementFeng Changjun Vice PresidentLi Jun Secretary to the Board of Direct

94、orsLiao Xianjun Joint Company SecretaryBrief biographies of each of the directors and senior management are set out on pages 49 to 50 and 52 to 54 of this annual report.SupervisorsHe Wei Chairman of the Supervisory CommitteeBao Hongxiang SupervisorJin Jun Employee SupervisorBrief biographies of each

95、 of the supervisors are set out on pages 51 to 52 of this annual report.18Dongfeng Motor Group Company LimitedDirector Report(Continued)Directors and Supervisors Interests in the Share Capital of the CompanyAs of 31 December 2023,the directors,supervisors,and key executive officers of the Company,as

96、 well as their associates,held the following interests in the share capital or debt securities of the Company or any associated corporations(as defined in the Securities and Futures Ordinance):(a)interests that are required to be notified to the Company and the Stock Exchange under Divisions 7 and 8

97、 of Part XV of the Securities and Futures Ordinance(including interests deemed or treated as owned under the relevant provisions of the Securities and Futures Ordinance and short positions);or(b)interests that are required to be registered in the register referred to in section 352 of the Securities

98、 and Futures Ordinance;or(c)interests that are required to be notified to the Company and the Stock Exchange under the Model Code for Securities Transactions by Directors of Listed Issuers(the“Model Code”)of the Listing of Securities on the Stock Exchange as follows:Long positions in shares and unde

99、rlying shares of the Company:NamePositionClass of shareCapacity in which shares were/are heldNumber of shares bought/sold or involvedPercentage of issued shares in class Percentage in the total share capital(%)(%)He Wei Chairman of the Supervisory Committee H Share of the Company Beneficial interest

100、 100,000(Long Position)0.00 0.00Jin Jun Employee Supervisor H Share of the Company Beneficial interest 60,000(Long Position)0.00 0.00Confirmations of independence from independent non-executive directorsThe Company has received the annual written confirmations of independence from all independent no

101、n-executive directors in 2023,namely Mr.Zong Qingsheng,Mr.Leung Wai Lap,Philip,and Mr.Hu Yiguang.They are independent in the view of the Company.Directors and supervisors service contractsNone of directors nor supervisors proposed to be re-elected at the forthcoming annual general meeting have enter

102、ed into a service contract with the Company which is not determinable by the Company within one year without payment of compensation,other than statutory compensation.Directors and supervisors interests in contractsExcept for service contract,none of the directors or supervisors of the Company has d

103、irect or indirect material interests in any important contract entered into by the Company or any of its subsidiaries and JCEs during the year ended 31 December 2023.192023 Annual ReportDirector Report(Continued)Remunerations of directors and supervisorsDetails of the remunerations of the directors

104、and supervisors of the Company are set out in note 8 to the audited financial statements.Five highest-paid individualsInformation on the five highest-paid individuals of the Company is set out in note 9 to the audited financial statements.EmployeesAs at 31 December 2023,Dongfeng Motor Group had a to

105、tal of 112,706 full-time employees.The number of employees in various divisions and their percentage of the total number of employees are as follows:DivisionNo.of EmployeesPercentage of TotalManufacturing workers65,47558.07%Engineering and technology18,66716.56%Management28,09424.91%Services5240.46%

106、Total112,760100.00%The remuneration package of Dongfeng Motor Groups employees includes salary,bonuses and allowances.In accordance with the relevant national and local laws and regulations on labour and social welfare,each member of Dongfeng Motor Group is required to pay in respect of each of its

107、relevant employees a monthly social insurance premium covering pension insurance,medical insurance,unemployment insurance,occupational injury insurance and maternity insurance.20Dongfeng Motor Group Company LimitedDirector Report(Continued)Retirement benefitsDetails of the retirement benefits provid

108、ed by the Group are set out in note 6 to the audited financial statements for the year.Management contractsNo contracts concerning the management or administration of the whole or any substantial part of the business of the Company were entered into with any person,firm or legal person during the ye

109、ar ended 31 December 2023.Directors and supervisors interests in competing businessesNone of the directors of the Company or their associates own any interests in businesses which compete or are likely to compete with the businesses of the Group nor have other interest conflicts with the Group.Compl

110、iance with non-competition agreementThe Company has received from Dongfeng Motor Corporation a written confirmation confirming that during the year ended 31 December 2023,it had complied with Non-competition Agreement signed with the Company.Public floatAs at the date of this report,on the basis of

111、publicly available information and to the best knowledge of the Company and its directors,more than 25%of the Companys total issued share capital is held by the public(as defined in the Listing Rules of the Stock Exchange of Hong Kong).212023 Annual ReportDirector Report(Continued)IV.CONNECTED TRANS

112、ACTIONSFor the year ended 31 December 2023,the continuing connected transactions between Dongfeng Motor Group and Dongfeng Motor Corporation and its associates(as defined under the Listing Rules)were as follows(together with the highest annual caps exempted subject to the Listing Rules):(Unless othe

113、rwise specified,the following connected transaction amounts of Dongfeng Motor Group(including joint ventures)are prepared on a full consolidated basis(before adjustment on a proportionate consolidated basis)1.Trademarks LicensingDate:29 October 2005Parties:(1)Dongfeng Motor Group(2)Dongfeng Motor Co

114、rporationObjective:Dongfeng Motor Corporation granted to Dongfeng Motor Group a non-exclusive right to use certain trademarks owned by and registered in the name of Dongfeng Motor Corporation in order to ensure the commercial activities of the Company,including sales of products,are in compliance wi

115、th the applicable laws and regulationsTerm:Ten years from 7 December 2005 to 6 December 2015(the agreement has been automatically renewed for another ten years upon its expiration of the ten-year term)Pricing:Nil2.Social Insurance FundsFor the year ended 31 December 2023,Dongfeng Motor Group made pa

116、yments to the following funds or schemes through the accounts of Dongfeng Motor Corporation according to the applicable laws and regulations in the PRC:(1)basic pension fund;(2)supplementary pension fund;(3)medical insurance;(4)unemployment insurance;and(5)housing provident fund(collectively called“

117、Social Insurance Funds”).22Dongfeng Motor Group Company LimitedDirector Report(Continued)3.Master Auto Parts Sales AgreementOn 4 January 2023,Dongfeng Motor Group and Dongfeng Motor Corporation entered into a master agreement(the“Master Auto Parts Sales Agreement”)in relation to sales of auto parts

118、and other products,the principal terms of which are set out below.Date:4 January 2023Parties:(1)Dongfeng Motor Group(2)Dongfeng Motor CorporationObjective:Pursuant to the Renewed Master Auto Parts Sales Agreement,the Company agreed to sell and procure its subsidiaries to sell auto parts,raw material

119、s and other products(including,amongst others,fuel tank,exhaust pipes,mounting and other auto parts of commercial vehicles)to the DFM Group for producing products as required.During the term of the Renewed Master Auto Parts Sales Agreement,the parties and/or their respective subsidiaries may from ti

120、me to time enter into definitive sale agreements setting out further particulars on the sale.The exact number of the auto parts and other products to be sold is based on the parties production plans and/or the specific sale agreements.Term:Three years from 4 January 2023 to 31 December 2025(both day

121、s inclusive)Pricing:The prices of the auto parts and other products charged by the Company will be determined in accordance with prevailing market prices that are comparable to the price offered to the Company by its other independent customers and are to be agreed between the parties.The proposed a

122、nnual caps for sales of auto parts to Dongfeng Motor Corporation and its subsidiaries for the year 2023 was approximately RMB1,500 million.As of 31 December 2023,the annual actual amount for Dongfeng Motor Corporation and its subsidiaries purchase of auto parts was approximately RMB351 million.23202

123、3 Annual ReportDirector Report(Continued)4.Master Auto Parts Procurement AgreementOn 4 January 2023,Dongfeng Motor Group and Dongfeng Motor Corporation entered into a master agreement(the“Master Auto Parts Procurement Agreement”)regarding the procurement of auto parts and other products for the Grou

124、p,the principal terms of which are set out below.Date:4 January 2023 Parties:(1)Dongfeng Motor Group(2)Dongfeng Motor CorporationObjective:Pursuant to the Renewed Master Auto Parts Procurement Agreement,DFM agreed to provide and procure its subsidiaries to provide auto parts and other products(inclu

125、ding,amongst others,event data recorders,electronic products and other customised auto parts)to the Group as required by the Group from time to time.During the term of the Renewed Master Auto Parts Procurement Agreement,the parties and/or their respective subsidiaries may from time to time enter int

126、o definitive procurement agreements setting out further particulars on the procurement.The exact number of the auto parts and other products to be purchased is based on the parties production plans and/or the specific procurement agreements.Term:Three years from 4 January 2023 to 31 December 2025(bo

127、th days inclusive)Pricing:The purchase prices to be payable by Dongfeng Motor Group under the Master Auto Parts Procurement Agreement are determined with reference to the market price of comparable products which are available on an arms length basis and on terms no less favourable than those provid

128、ed by at least two independent suppliers for comparable productsThe proposed annual caps for procurement of auto parts from Dongfeng Motor Corporation and its subsidiaries for the year 2023 was approximately RMB580 million.As of 31 December 2023,the annual actual amount of procurement of auto parts

129、from Dongfeng Motor Corporation and its subsidiaries was approximately RMB106 million.24Dongfeng Motor Group Company LimitedDirector Report(Continued)5.Master Logistics Services AgreementOn 4 January 2023,Dongfeng Motor Group and Dongfeng Motor Corporation entered into a master agreement in relation

130、 to provision of logistics services(the“Master Logistics Services Agreement”),the principal terms of which are set out below.Date:4 January 2023Parties:(1)Dongfeng Motor Group(2)Dongfeng Motor CorporationObjective:Pursuant to the Master Logistics Services Agreement,Dongfeng Motor Corporation agreed

131、to provide and procure its subsidiaries to provide logistics services to the Group.During the term of the Master Logistics Services Agreement,Dongfeng Motor Group may from time to time enter into individual agreement(s)or sales orders with Dongfeng Motor Corporation and its subsidiaries in relation

132、to provision of logistics services to the GroupTerm:Three years from 4 January 2023 to 31 December 2025(both days inclusive)Pricing:The price under the Master Logistics Services Agreement will be agreed within the range of the government-guided price(if any)prescribed or approved by state or local p

133、rice control department and where there is no government-guided price,at market priceThe proposed annual caps for the logistics services provided by Dongfeng Motor Corporation and its subsidiaries to Dongfeng Motor Group for the year 2023 is approximately RMB8,000 million.As of 31 December 2023,the

134、annual actual amount for Logistics Service provided by Dongfeng Motor Corporation and its subsidiaries to Dongfeng Motor Group was approximately RMB5,375 million.252023 Annual ReportDirector Report(Continued)6.Master Automobile Inspection Services AgreementOn 4 January 2023,Dongfeng Motor Group and

135、Dongfeng Motor Corporation entered into the master technology consultancy and automobile inspection services agreement(the“Master Automobile Inspection Services Agreement”),the principal terms of which are set out below.Date:4 January 2023Parties:(1)Dongfeng Motor Group(2)Dongfeng Motor CorporationO

136、bjective:Pursuant to the Master Automobile Inspection Services Agreement,Dongfeng Motor Group agrees to engage Dongfeng Motor Corporation and its subsidiaries for provision of technology consultancy and vehicle inspection services.During the term of the Master Automobile Inspection Services Agreemen

137、t,Dongfeng Motor Group may from time to time enter into definitive written agreement(s)with Dongfeng Motor Corporation and its subsidiaries in relation to the provision of technology consultancy and vehicle inspection services to the Group,subject to the terms and conditions of and in compliance wit

138、h the Master Automobile Inspection Services AgreementTerm:Three years from 4 January 2023 to 31 December 2025(both days inclusive)Pricing:The price will be determined with reference to the market prices for comparable services which are available on an arms length basis and on terms no less favourab

139、le than those provided by at least two independent service providers for services of the same type and comparable quality.In determining the market prices,the marketing department of the Company will collect the relevant market information,review and compare the quotations obtained from at least two

140、 independent service providers for identical or comparable services,and prepare fee quotes for review by the business department of the Company.The business department will take into consideration the average transaction price of the target services in the preceding year and the competition status w

141、hen reviewing the fee quotes.The business department of the Company will further submit the fee quotes to the management of the Company for review and approval.The annual caps of payment by Dongfeng Motor Group to Dongfeng Motor Corporation and its subsidiaries for the provision of vehicle inspectio

142、n services by Dongfeng Motor Corporation and its subsidiaries are approximately RMB1,000 million for the year 2023.As of 31 December 2023,the annual actual amount for vehicle inspection services provided by Dongfeng Motor Corporation and its subsidiaries to Dongfeng Motor Group was approximately RMB

143、572 million.26Dongfeng Motor Group Company LimitedDirector Report(Continued)7.Financial Services Master AgreementOn 4 January 2023,Dongfeng Motor Group and Dongfeng Motor Corporation entered into a financial services master agreement(the“Financial Services Master Agreement”),the principal terms of w

144、hich are set out below.Date:4 January 2023Parties:(1)Dongfeng Motor Group(2)Dongfeng Motor CorporationObjective:Pursuant to the Financial Services Master Agreement,Dongfeng Motor Group agreed to provide and procure its subsidiaries to provide financial services to Dongfeng Motor Corporation and its

145、subsidiaries.The parties may from time to time enter into individual financial services agreement in compliance with the principles set out in the Financial Services Master Agreement.Services to be provided by Dongfeng Motor Group to Dongfeng Motor Corporation and its subsidiaries include(i)treasury

146、 services,including budget management,settlement,fund allocation and depository;(ii)financing services,including lending,discount,acceptance and factoring;and(iii)financial services in relation to the automobile products of Dongfeng Motor Corporation,including consumer facilities,buyer facilities an

147、d leasingTerm:Three years from 4 January 2023 to 31 December 2025(both days inclusive)Pricing:Financial services to be provided under the Financial Services Master Agreement will be charged at(i)the government-prescribed prices approved by the state or local government;(ii)where there is no governme

148、nt prescribed price but where there is a government guidance price,the government-guidance prices;and(iii)where there is neither a government prescribed price nor a government-guidance price,the market prices;and/or(iv)at rates determined on an arms length and reasonable basis and comply with the ap

149、plicable policies and requirements stipulated by the relevant financial regulatory authorities from time to time and other applicable laws,rules and regulations of the PRCThe proposed annual cap for the outstanding loans(excluding entrust loans)to be provided by Dongfeng Motor Corporation and its su

150、bsidiaries to the Company of the year 2023 was RMB1,500 million.As of 31 December 2023,the outstanding loans(excluding entrust loans)to be provided by Dongfeng Motor Corporation and its subsidiaries to Dongfeng Motor Group were approximately RMB0 million.272023 Annual ReportDirector Report(Continued

151、)8.Renewed DF Nissan Auto Finance Master Financial Services AgreementOn 4 January 2023,Dongfeng Motor Group entered into a renewed master financial services agreement(the“Renewed DF Nissan Auto Finance Master Financial Services Agreement”)with DF Nissan Auto Finance for the provision of financial se

152、rvices to DF Nissan Auto Finance,the principal terms of which are set out below.Date:4 January 2023Parties:(1)Dongfeng Motor Group(2)Dongfeng Nissan Auto Finance Co.,Ltd.Objective:Pursuant to the Renewed DF Nissan Auto Finance Master Financial Services Agreement,the Company agreed to purchase and DF

153、 Nissan Auto Finance agreed to provide financial services to the Company and its subsidiaries.The parties may from time to time enter into individual financial services agreement setting out the particulars of the services in compliance with the principles set out in the Renewed DF Nissan Auto Finan

154、ce Master Financial Services Agreement.Services to be provided by DF Nissan Auto Finance and its subsidiaries to the Group include(i)accepting deposit placed by the Group;(ii)financial services in relation to the automobile products including consumer facilities and financial leasing.Term:Three year

155、s from 4 January 2023 to 31 December 2025(both days inclusive)Pricing:Financial services to be provided under the Renewed DF Nissan Auto Finance Master Financial Services Agreement will be charged at(i)the government-prescribed prices approved by the state or local government;(ii)where there is no g

156、overnment-prescribed price but where there is a government-guidance price,the government-guidance prices;and(iii)where there is neither a government prescribed price nor a government-guidance price,the market prices;and/or(iv)rates determined with reference to rates set by the commercial banks on an

157、 arms length and reasonable basis and in compliance with the applicable policies and requirements stipulated by the relevant financial regulatory authorities from time to time and other applicable laws,rules and regulations of the PRC.The maximum balance of Deposits maintained by Dongfeng Motor Grou

158、p with Dongfeng Nissan Auto Finance Co.,Ltd.shall not exceed RMB3,000 million on any given day for the year 2023.As of 31 December 2023,the outstanding amount of the deposits placed by Dongfeng Motor Group with Dongfeng Nissan Auto Finance Co.,Ltd.was RMB0 million.28Dongfeng Motor Group Company Limi

159、tedDirector Report(Continued)9.Master Lease Agreement(1)On 4 January 2023,Dongfeng Motor Group and Dongfeng Motor Corporation entered into a master lease agreement(the“Renewed Master Lease Agreement”),the principal terms of which are set out below.Date:4 January 2023Parties:(1)Dongfeng Motor Group(e

160、xcluding Dongfeng Motor Co.,Ltd.)(2)Dongfeng Motor CorporationSubject matter:Pursuant to the Renewed Master Lease Agreement,DFM agreed to lease and procure its subsidiaries to lease the land use rights of a piece of land located in Hubei Province,the ownership of the buildings thereon and related ma

161、chinery,transportation and office equipment(the“Assets”)to the Company and its subsidiaries and the Company agreed to lease the Assets from DFM and its subsidiaries to meet the Groups production and operational needs.Lease term:Three years from 4 January 2023 to 31 December 2025(both days inclusive)

162、;and before the lease term expires,the parties may negotiate to extend or renew the lease.Rental:The rental amount is determined with reference to the market rental of the Assets as appraised by an independent valuer jointly engaged by the parties to the Renewed Master Lease Agreement based on the m

163、arket rental of comparable assets which are available on an arms length basis and on terms no less favourable than those provided by at least two independent providers for assets of comparable quality,and the transaction prices between the Group and independent third parties for leases of similar as

164、sets in similar locations(if any).During the term of the Renewed Master Lease Agreement,rental payments shall be made semi-annually and within 10 days after half of or the whole calendar year(i.e.30 June or 31 December).If the Company or its subsidiaries fail to meet their payment obligations under

165、the Master Lease Agreement,it will pay to DFM or its subsidiaries a fine on a daily basis at the rate of 5%until the outstanding payment has been made.Sublet:Without written consent from Dongfeng Motor Corporation or its subsidiaries,Dongfeng Motor Group shall not sublet the land or assign any right

166、s or obligations under the Master Land Lease.And the land shall be used according to the purpose as set out in the Master Land Lease292023 Annual ReportDirector Report(Continued)The annual cap of the net value of right-of-use assets arised from leasing by Dongfeng Motor Group from Dongfeng Motor Cor

167、poration was approximately RMB1,500 million in 2023.As of 31 December 2023,the net value of right-of-use assets arised from leasing by Dongfeng Motor Group(excluding Dongfeng Motor Co.,Ltd.)to Dongfeng Motor Corporation was approximately RMB1,027 million.(2)Lease land between Dongfeng Motor Co.,Ltd.

168、and Dongfeng Motor CorporationDate:From 2003 to 2053Parties:(1)Dongfeng Motor Co.,Ltd.(2)Dongfeng Motor CorporationLease Term:50 yearsPricing:Dongfeng Motor Co.,Ltd.leases land parcels from Dongfeng Motor Corporation for ordinary production and operationPricing:At fair market rateThe Company and the

169、 Stock Exchange have agreed that the abovementioned transactions will comply with the annual reporting requirements under Rule 14A.71 of the Listing Rules,and the Company will only disclose annual total amounts of transactions pursuant to waivers stated in the following paragraphs(i)and(iv).It was d

170、ue to the fact that disclosure of consideration for each transaction of each joint venture may constitute a disclosure of commercial sensitive information of the joint ventures and is not in the interests of the Company nor the joint ventures.In addition,with respect to transactions mentioned in the

171、 following paragraphs(ii)and(iii),disclosing total consideration and additional terms in compliance with Rule 14A.71(4)of the Listing Rules will constitute a disclosure of commercial sensitive information of the joint ventures and is not in the interests of the Company nor the joint ventures.In this

172、 regard,the Company has applied to the Stock Exchange for,and has been granted with,a waiver from strict compliance with the requirements under Rule 14A.71(4)of the Listing Rules during each of the transaction periods.Annual caps of the abovementioned transactions determined in accordance with the r

173、equirements stipulated in Rule 14A.53(2)of the Listing Rules will not be in the interests of the Company and relevant joint ventures.In this regard,the Company has applied to the Stock Exchange for,and has been granted with,a waiver from strict compliance with the requirements under Rule 14A.53(2)of

174、 the Listing Rules during each of the transaction periods.As of 31 December 2023,the total net value of right-of-use assets arising from leasing by Dongfeng Motor Co.,Ltd.to Dongfeng Motor Corporation was approximately RMB485 million.30Dongfeng Motor Group Company LimitedDirector Report(Continued)10

175、.Mutual Supply between Dongfeng Motor Group and Dongfeng Hongtai Wuhan Holdings Group LimitedDate:28 November 2006Parties:Dongfeng Motor GroupDongfeng Hongtai Holdings Group Limited Term:Agreement has been effective from 28 November 2006 and is a continuing contract terminable by agreement between t

176、he parties on the occurrence of certain events such as the bankruptcy or reorganisation of a party Objective:Dongfeng Motor Group sells whole vehicles and purchases auto parts such as seats for assembly through the whole vehicles selling network of Dongfeng Hongtai.Dongfeng Hongtai purchases related

177、 auto parts for assembly from Dongfeng Motor Group Pricing:The consideration shall be determined on the following basis:(a)at market price(b)on normal commercial termsOn 22 December 2008,Dongfeng Motor Group was informed by Dongfeng Motor Corporation that Dongfeng Motor Corporation acquired 91.25%in

178、terest in Dongfeng Hongtai.As of 31 December 2023,Dongfeng Motor Corporation still owned 87.24%interests in Dongfeng Hongtai.Dongfeng Motor Corporation,being a substantial shareholder of Dongfeng Motor Group.Dongfeng Hongtai,having become a non-wholly-owned subsidiary of Dongfeng Motor Corporation,h

179、as also become a connected person and the associate of a connected person of the Company within the meaning of the Listing Rules.As a result,the ongoing transactions contemplated under the Mutual Supply Agreement between Dongfeng Motor Group and Dongfeng Hongtai have become continuing connected tran

180、sactions of the Company.As of 31 December 2023,the total consideration paid by Dongfeng Motor Group to Dongfeng Hongtai for purchases of vehicle and auto parts from Dongfeng Hongtai was RMB2,272 million and the total amount paid by Dongfeng Hongtai to Dongfeng Motor Group for purchases of vehicle an

181、d auto parts from Dongfeng Motor Group was RMB383 million.312023 Annual ReportDirector Report(Continued)11.Whole Vehicle Sales AgreementDate:4 January 2023Parties:Dongfeng Motor Group Dongfeng Nissan Financial Leasing Co.,Ltd.Term:Three years from 4 January 2023 to 31 December 2025(both days inclusi

182、ve)Objective:Dongfeng Motor Group and its subsidiaries sell whole vehicles to Dongfeng Nissan Financial Leasing Co.,Ltd.in accordance with the conditions and methods agreed in this agreement.Pricing:The prices of the whole vehicles are determined based on the market price,or/and on an arms length an

183、d reasonable basis.DF Nissan Financial Leasing shall pay the price to the Company and its subsidiaries in the way agreed by both parties at the appointed time.As of 31 December 2023,Nissan(China)Investment Co.,Ltd.holds 50%equity of Dongfeng Motor Co.,Ltd.,which is a jointly controlled entity of Don

184、gfeng Motor Group and is also regarded as a subsidiary of the Company.Dongfeng Nissan Financial Leasing Co.,Ltd.is a subsidiary of Nissan(China)Investment Co.,Ltd.,and is the associate of the major shareholders of the subsidiary of Dongfeng Motor Group,and therefore constitutes a connected person at

185、 the subsidiary level of the Company in accordance with the Listing Rules.Therefore,the transactions involved in the Supply and Entrusted Loans Agreement between Dongfeng Motor Group and Dongfeng Nissan Financial Leasing is the continuing related party transactions of the Company.In 2023,the annual

186、caps for the sale of whole vehicles by Dongfeng Motor Group and its subsidiaries to Dongfeng Nissan Financial Leasing Co.,Ltd.amounted to RMB1 billion.As of 31 December 2023,Dongfeng Nissan Financial Leasing Co.,Ltd.purchased whole vehicles from Dongfeng Motor Group and its subsidiaries with the amo

187、unt of RMB0 billion.32Dongfeng Motor Group Company LimitedDirector Report(Continued)12.The purchase of whole vehicles and chassisOn 4 January 2023,Dongfeng Motor Group and Dongfeng Motor Group Co.,Ltd.entered into a master agreement in relation to the purchase of the Groups complete vehicles and cha

188、ssis(the“Complete Vehicle and Chassis Purchase Master Agreement”),the principal terms of which are set out below.Date:4 January 2023Parties:(1)Dongfeng Motor Group(2)Dongfeng Motor CorporationObjective:Dongfeng Motor Group shall provide the Company and its subsidiaries with whole vehicles and chassi

189、s in accordance with the demand of the Group.The quantities of whole vehicles and chassis shall be determined based on the production plans of both parties and/or specific purchase agreements entered into by both parties.Term:Three years from 4 January 2023 to 31 December 2025(both days inclusive)Pr

190、icing:The prices of the whole vehicles and chassis shall be determined based on the market price,and/or on an arms length and reasonable basis.The Group shall pay the price to the Dongfeng Motor Group using the payment method agreed upon by both parties at the specific time.Under normal circumstance

191、s,the specific purchase agreement signed by the Group and the Dongfeng Motor Group shall specify the payment period(such as monthly payment or quarterly payment,etc.)in accordance with the principle of fairness and reasonableness and ordinary commercial practice.The terms of the specific purchase ag

192、reement shall not be inferior to those that the Company may receive from an independent third party.In 2023,the annual caps for the Dongfeng Motor Groups purchase of whole vehicles and chassis from Dongfeng Motor Corporation amounted to RMB100 million.As of 31 December 2023,Dongfeng Motor Group purc

193、hased whole vehicles and chassis from Dongfeng Motor Corporation with the actual amount of RMB4.1223 million.332023 Annual ReportDirector Report(Continued)13.Provision of Entrusted Loans AgreementDate:1 February 2021Parties:Dongfeng Motor Group Dongfeng Nissan Financial Leasing Co.,Ltd.Term:Three ye

194、ars from 1 February 2021 to 31 December 2023(both days inclusive)Objective:Dongfeng Motor Group and its subsidiaries provide entrusted loans to Dongfeng Nissan Financial Leasing Co.,Ltd.in accordance with the conditions and methods agreed in this agreement.Pricing:Entrusted loans shall be priced bas

195、ed on market rates(government-prescribed rate or government-guidance rate shall prevail if there is any),an arms length and reasonable basis and in compliance with the applicable policies and requirements stipulated by the relevant financial regulatory authorities from time to time and other applica

196、ble laws,rules and policies of the PRC.For Dongfeng Motor Group,the terms of each specific entrusted loan agreement shall not be inferior to those received from an independent third party.As of 31 December 2023,Nissan(China)Investment Co.,Ltd.holds 50%equity of Dongfeng Motor Co.,Ltd.,which is a joi

197、ntly controlled entity of Dongfeng Motor Group and is also regarded as a subsidiary of the Company.Dongfeng Nissan Financial Leasing Co.,Ltd.is a subsidiary of Nissan(China)Investment Co.,Ltd.,and it is the associate of the major shareholders of the subsidiary of Dongfeng Motor Group,and therefore c

198、onstitutes a connected person at the subsidiary level of the Company in accordance with the Listing Rules.Therefore,the transactions involved in the Supply and Entrusted Loans Agreement between Dongfeng Motor Group and Dongfeng Nissan Financial Leasing is the continuing related party transactions of

199、 the Company.In 2023,the annual caps for the provision of entrusted loans by Dongfeng Motor Group and its subsidiaries to Dongfeng Nissan Financial Leasing Co.,Ltd.amounted to RMB2,800 million.As of 31 December 2023,the total amount of entrusted loans provided by Dongfeng Motor Group and its subsidi

200、aries to Dongfeng Nissan Financial Leasing Co.,Ltd.was RMB0 million.34Dongfeng Motor Group Company LimitedDirector Report(Continued)14.Whole Vehicle and Chassis Master Sales AgreementOn 4 January 2023,Dongfeng Motor Group entered into the master agreement on the sales of whole vehicles and chassis(t

201、he“Whole Vehicle and Chassis Master Sales Agreement”)with Dongfeng Motor Corporation.The principal terms are set out below.Date:4 January 2023Parties:(1)Dongfeng Motor Group(2)Dongfeng Motor CorporationObjective:According to the Whole Vehicle and Chassis Master Sales Agreement,during the validity pe

202、riod of this agreement,Dongfeng Motor Group and its subsidiaries should provide Dongfeng Motor Corporation and its subsidiaries with whole vehicles and/or chassis in accordance with the conditions agreed in this agreement.Term:From 4 January 2023 to 31 December 2025(both days inclusive)Pricing:The p

203、rices of the whole vehicles and/or chassis are determined based on the market price or/and on an arms length and reasonable basis.The payment period(such as monthly payment or quarterly payment,etc.)shall be agreed on in the specific supply agreement in accordance with the principle of fairness and

204、reasonableness and the ordinary commercial practice,and ensure that for Dongfeng Motor Group,the terms of the specific supply agreement shall not be inferior to those received from an independent third party.In 2023,the proposed annual caps for the sales of whole vehicles and chassis to Dongfeng Mot

205、or Corporation and its subsidiaries amounted to approximately RMB1,500 million.As of 31 December 2023,the actual amount paid by Dongfeng Motor Corporation and its subsidiaries for purchasing whole vehicles and chassis was approximately RMB620 million.352023 Annual ReportDirector Report(Continued)15.

206、For the year ended 31 December 2023,the continuing connected transactions relating to the joint ventures include:The following are additional continuing connected transactions of Dongfeng Motor Group as a result of the Stock Exchanges requirement that its existing and future joint ventures be regula

207、ted in a manner consistent with the regulation of subsidiaries of a listed group.(i)Purchases of auto parts and production facilities by the Companys joint ventures(including subsidiaries,joint ventures and associates)from their joint venture partners(including their subsidiaries and associates)As o

208、f 31 December 2023,each of Dongfeng Motor Co.,Ltd.,Dongfeng Peugeot Citron Automobile Co.,Ltd.,Dongfeng Honda Automobile Co.,Ltd,Dongfeng Honda Engine Co.,Ltd.and Dongfeng Honda Auto Parts Co.,Ltd.(including each of these companies subsidiaries,joint ventures and associates)regularly purchased auto

209、parts or production facilities from the joint venture partners of the Company in the manner described below and such purchases will continue for the duration of the joint venture term.Once the joint venture partners have agreed that a joint venture will commence the manufacturing of a new vehicle mo

210、del,representatives of the joint venture will enter into negotiations with the foreign joint venture partner to determine an agreed price list for each component needed to manufacture that model.Pursuant to the contractual provisions of the applicable joint venture agreement,the negotiations between

211、 the relevant representatives of the joint venture and the relevant joint venture partners to determine the agreed price list will always be conducted either directly by the Company,as a joint venture partner,or by the relevant joint venture officers nominated by the Company to do so on behalf of th

212、e Company.The Company and its joint venture partners are independent from each other for this purpose;no joint venture partner is in a position to influence the Company to agree to terms which may not be in the joint ventures and the Companys interest.Pursuant to the operating procedures of the Comp

213、any,the representatives nominated by the Company have been delegated with the power to approve transactions within the ordinary course of business of a joint venture.However,transactions which are outside the ordinary course of business,material or complex must be reported to and approved by the rel

214、evant department of the Company.As such,such negotiations are carried out on arms length commercial terms.In respect of such transactions,it will be in the interest of the Company and the joint ventures if there is any alternative that can be obtained from local suppliers on better terms since the p

215、urchases of components or production equipment from the Companys joint venture partners involve additional freight costs and taxations.36Dongfeng Motor Group Company LimitedDirector Report(Continued)In respect of such transactions,the joint venture will obtain quotes for equivalent components and pr

216、oduction equipment that may be available from local PRC suppliers in order to determine whether viable alternatives can be obtained(1)with the highest quality;(2)in a timely manner;(3)at the most competitive prices.If related products are available,the joint venture will carry out a tender before se

217、lecting a supplier.During the process of the tender,the joint venture shall treat the partner and other third party suppliers equally.As a result,the Company will not purchase any auto parts and production equipment from the joint venture partner if the Company can obtain better terms from other sup

218、pliers.After a certain period,fewer auto parts and production equipment will be purchased from the joint venture partner since many alternatives with competitive pricing and quality are available in the PRC.The process described above,known as“localisation”,is a stated priority of the joint ventures

219、 provided in the relevant joint venture contracts.The joint ventures(including their subsidiaries,joint ventures and associates)may only purchase auto parts and production equipment from the joint venture partners(including their subsidiaries and associates)if it is unable to obtain auto parts of eq

220、uivalent quality or of the required specifications at a more favourable price(or otherwise on more favourable terms)from a local supplier.The contracts regarding the purchases of auto parts and production equipment by the joint ventures(including their subsidiaries,joint ventures and associates)from

221、 the joint venture partners(including their subsidiaries and associates)must be pre-approved by the Company to ensure that the joint venture only enters into transactions on normal commercial terms or terms which are more favourable to the joint venture.Therefore,purchases of auto parts and producti

222、on facilities by the joint ventures(including their subsidiaries,joint ventures and associates)from their joint venture partners(including their subsidiary and associates)constitute continuing connected transactions and were made according to fair and reasonable terms.All of these parameters are set

223、 out in the joint venture contracts and will remain in place for the duration of the joint venture term.As of 31 December 2023,the total consideration paid by the joint ventures(including their subsidiaries,joint ventures and associates)in respect of purchases of auto parts and production facilities

224、 from the joint venture partners(including their subsidiaries and associates)was RMB43,196 million.372023 Annual ReportDirector Report(Continued)(ii)Sales of auto parts by Dongfeng Honda Auto Parts Co.,Ltd.to Honda Trading(China)Co.,Ltd.and Honda Motor(China)Co.,Ltd.Honda Trading(China)Co.,Ltd.and H

225、onda Motor(China)Co.,Ltd.,both of which are based in Hong Kong and engaged primarily in the import and export of Honda products,are subsidiaries of Honda Motor Co.,Ltd.The sales of auto parts by Dongfeng Honda Auto Parts Co.,Ltd.to Honda Trading(China)Co.,Ltd.constitute continuing connected transact

226、ions.One of the primary reasons for the formation of Dongfeng Honda Auto Parts Co.,Ltd.was to manufacture auto parts for sales within the PRC and for export to the companies of Honda group overseas,with the corresponding benefits to such companies due to the economies of scale.Consequently,Dongfeng

227、Honda Auto Parts Co.,Ltd.regularly sells auto parts to Honda Trading(China)Co.,Ltd.and Honda Motor(China)Co.,Ltd.Such auto parts are then exported by Honda Trading(China)Co.,Ltd.and Honda Motor(China)Co.,Ltd.to Honda Motor Co.,Ltd.Dongfeng Honda Auto Parts Co.,Ltd.continued to sell auto parts to Hon

228、da Trading(China)Co.,Ltd.and Honda Motor(China)Co.,Ltd.as at 31 December 2023.All existing and future negotiations regarding the sales to Honda Trading(China)Co.,Ltd.and Honda Motor(China)Co.,Ltd.were conducted by a Company representative on behalf of Dongfeng Honda Auto Parts Co.,Ltd.Pursuant to th

229、e operating procedures of the Company,the representatives nominated by the Company have been delegated with the power to approve transactions within the ordinary course of business of a joint venture.However,transactions which are outside of the ordinary course of business,material or complex must b

230、e reported to and approved by the relevant department of the Company.Therefore,such sales were and will be negotiated on arms length commercial terms and the consideration for sales of auto parts are based on normal market and commercial terms as agreed on a batch basis and without subject to a fram

231、ework agreement.38Dongfeng Motor Group Company LimitedDirector Report(Continued)(iii)Sales of passenger vehicle engines and related auto parts from Dongfeng Honda Engine Co.,Ltd.to GAC Honda Automobile Co.,Ltd.pursuant to the arrangements among Dongfeng Motor Corporation,Honda Motor Co.,Ltd.and Guan

232、gzhou Automobile Group Co.,Ltd.The establishment of Dongfeng Honda Engine Co.,Ltd.formed part of the arrangements between Dongfeng Motor Corporation,Honda Motor Co.,Ltd.and Guangzhou Automobile Group Co.,Ltd.The primary reason for the formation of Dongfeng Honda Engine Co.,Ltd.was to manufacture eng

233、ines and other related auto parts for sale to GAC Honda Automobile Co.,Ltd.,Honda Motor Co.,Ltd.s another main automotive manufacturing joint venture in the PRC.Dongfeng Motor Corporations interests in Dongfeng Honda Engine were subsequently transferred to the Company.Pursuant to the arrangements am

234、ong Dongfeng Motor Corporation,Honda Motor Co.,Ltd.and Guangzhou Automobile Group Co.,Ltd.,GAC Honda Automobile Co.,Ltd.would only purchase from Dongfeng Honda Engine Co.,Ltd.engines and other related auto parts necessary for manufacturing of passenger vehicles for the duration of the joint venture

235、term at such prices as would enable the respective investment returns on Dongfeng Honda Engine Co.,Ltd.and on GAC Honda Automobile Co.,Ltd.to be proportionate to the initial investment in these two companies(US$60,060,000 in the case of Dongfeng Honda Engine Co.,Ltd.and US$139,940,000 in the case of

236、 GAC Honda Automobile Co.,Ltd.).The equity interests of GAC Honda Automobile Co.,Ltd.are equally held between Honda Motor Co.,Ltd.and Guangzhou Automobile Group Co.Ltd.As such,GAC Honda Automobile Co.,Ltd.is a connected person of the Company under Rule 14A.07 of the Listing Rules and the sales of re

237、lated auto parts from Dongfeng Honda Engine Co.,Ltd.to GAC Honda Automobile Co.,Ltd.constitute continuing connected transactions.Pursuant to the contractual provisions of the relevant joint venture agreement,the negotiations for the sale of engines and other auto parts between Dongfeng Honda Engine

238、Co.,Ltd.and GAC Honda Automobile Co.,Ltd.will always be conducted by the joint ventures officers nominated by the Company on behalf of Dongfeng Honda Engine Co.,Ltd.The Company and its joint venture partner are independent from each other for this purpose,so that no joint venture partner is in a pos

239、ition to influence the Company to agree to terms which may not be in the joint ventures(and therefore the Companys)interests.Pursuant to the operating procedures of the Company,the representatives nominated by the Company have been delegated with the power to approve transactions within the ordinary

240、 course of business of a joint venture.However,transactions which are outside the ordinary course of business,material or complex,must be reported to and approved by the relevant department of the Company.As such,negotiations carried out are on arms length commercial terms.As of 31 December 2023,GAC

241、 Honda Automobile Co.,Ltd.continued to purchase from Dongfeng Honda Engine Co.,Ltd.engines and auto parts needed by it at a total consideration of RMB118 million.392023 Annual ReportDirector Report(Continued)(iv)Technology license and technical assistance between the joint ventures and their subsidi

242、aries on the one hand and their joint venture partners(including their subsidiaries)on the other handThe joint ventures make periodic payments of royalties to the foreign joint venture partners pursuant to the technology licence and technical assistance agreements entered into with the foreign joint

243、 venture partners of the Company in respect of existing vehicle models manufactured by the joint ventures.The terms of the agreements relating to technology licences and technical assistance are fixed with reference to the expected life cycle of vehicle models.Technology licence and technical assist

244、ance fees are negotiated on arms length commercial terms.Technology licence and technical assistance between the joint ventures and their subsidiaries on the one hand and their joint venture partners on the other hand constitute a continuing connected transaction.The terms of all technology licence

245、and technical assistance between the joint ventures,their subsidiaries and their joint venture partners are either governed by an umbrella agreement or separately entered into prior to the introduction of a new vehicle model.For one of the joint ventures,the terms of all technology licence and techn

246、ical assistance which have been entered into,and which in future will be entered into,between joint venture and its foreign joint venture partners are governed by an umbrella agreement,the agreed form of which was negotiated between the Company and the joint venture partner before the parties establ

247、ished the joint venture and agreed by the time the joint venture contract relating to the joint venture was signed.Therefore,the terms of the umbrella agreement were negotiated on an arms length basis between independent third parties.The umbrella agreement contains detailed terms which govern the d

248、etermination of consideration for each technology licence to be entered into between the Company and the joint venture partners.The umbrella agreement also provides provisions in relation to the consideration for the technology licensed,which is in the form of a royalty determined in accordance with

249、 a fixed formula.The term of the agreements relating to technology licence and technical assistance are fixed with reference to the expected life cycle of vehicle models.40Dongfeng Motor Group Company LimitedDirector Report(Continued)Pursuant to the contractual provisions of the applicable joint ven

250、ture agreement,all negotiations relating to technology license and technical assistance between the joint ventures,their subsidiaries and their joint venture partners(including their subsidiaries)will only be either done directly by the Company as a joint venture partner,or by the relevant joint ven

251、tures officers delegated by the Company to do so on behalf of the Company.Pursuant to the operating procedures of the Company,the representatives nominated by the Company have been delegated with the power to approve transactions in the ordinary course of business of a joint venture.However,transact

252、ions which are outside the ordinary course of business,material or complex must be reported to and approved by the relevant department of the Company.Therefore,such technology license and technical assistance between the joint ventures,their subsidiaries and their joint venture partners(including th

253、eir subsidiaries)were negotiated on arms length commercial terms.Generally,the pricing principle for technology license and technical assistance between the joint ventures,their subsidiaries and their joint venture partners(including their subsidiaries)and their subsidiaries and associates is that t

254、he party providing the technology should be fairly reimbursed for its research and development costs incurred in respect of a particular vehicle model.Furthermore,such research and development costs should be spread evenly over the entire operations of the party providing the technology,and the PRC

255、automotive joint venture should only bear its fair share of such costs.As of 31 December 2023,the total consideration paid by the joint ventures in respect of purchases of technology license and technical assistance stated above was RMB4,440 million.In future joint operating periods,such technology

256、license and technical assistance fees will continue to be paid to foreign joint venture partners in accordance with existing umbrella agreements and contracts signed from time to time.412023 Annual ReportManagement Discussion and AnalysisI.OPERATING ENVIRONMENTIn 2023,Chinas economic performance imp

257、roved,with the Gross Domestic Product(GDP)growth rate increasing by 5.2%year-on-year.The overall size of the economy scaled new heights,maintaining its status as the second-largest in the world.In 2023,the domestic automotive market experienced significant changes,and the production and sales for th

258、e year were 30,160,900 units and 30,093,700 units,respectively,representing a year-on-year increase of 11.6%and 12.0%,and the recovering trend of the automobile market outperformed expectation,with production and sales volumes reaching new highs and remaining as the top one in the world.The passenge

259、r vehicle market maintained growth,with sales of 26,062,800 units throughout the year,representing a year-on-year increase of 10.6%.Among which,the sales volume of SUV increased by 18.0%year on year,the sales volume of basic vehicles increased by 3.4%year on year,the sales volume of MPV increased by

260、 17.7%year on year,and the sales volume of CUV(cross-over utility vehicle)decreased by 18.1%year on year.Affected by stabilizing and improving macro economy and recovering demands of the consumer market,the commercial vehicles sales throughout the year were 4,030,900 units,representing a year-on-yea

261、r increase of 22.1%.In terms of the production and sales of different models,the sales of buses represented a year-on-year increase of 20.6%,and the sales of trucks represented a year-on-year increase of 22.4%.The new energy vehicle market maintained continuous and dynamic growth,the production and

262、sales throughout the year were 9,587,000 units and 9,495,000 units,respectively,representing a year-on-year increase of 35.8%and 37.9%,and its market share reached approximately 31.6%,representing a year-on-year increase of 5.9 percentage points.Among which,the production and sales of new energy com

263、mercial vehicles accounted for 11.5%and 11.1%of production and sales of commercial vehicles,respectively,and the production and sales of new energy passenger vehicles accounted for 34.9%and 34.7%of production and sales of passenger vehicles,respectively.42Dongfeng Motor Group Company LimitedManageme

264、nt Discussion and Analysis(Continued)II.OPERATION ANALYSISIn 2023,with profound changes in Chinas automobile market,the sales of the industry reached 30,093,700 units,representing a year-on-year increase of 12.0%.In particular,new energy vehicles and outbound exports became the main growth engine fo

265、r the industry,the market demand polarization accelerated,and the sales of non-luxury brands of joint ventures continued to decline.As the competition became more intensive brought about by“reducing price to secure more sales”,the transaction price of passenger vehicles dropped by more than 10%.The

266、Group was in the adjustment period of transformation and development.Despite challenges facing the overall operation,the Group forged ahead under pressure,with the production and sales resuming quarter by quarter and basically returning back to normal level in the fourth quarter.The strategic layout

267、,transformation breakthrough,brand enhancement and other aspects continuously optimized,and at the same time,new positive changes emerged:the strategic layout comprising new energy brands,platform structure and products was fully completed;the performance generated from independent brand passenger v

268、ehicle business continued to improve;the sales volume of commercial vehicle business rebounded steadily,with a year-on-year increase of 10.3%;and the outbound exports grew rapidly,setting a record high.The Group achieved sales volume of approximately 2,088,200 units during the period,representing a

269、year-on-year decrease of approximately 15.3%,sales revenue of approximately RMB99,315 million,gross profit margin of 9.5%and loss attributable to shareholders of approximately RMB3,996 million.The sales volume of the Groups independent brand passenger vehicle business was approximately 347,400 units

270、,representing a year-on-year decrease of 30.2%,the sales structure and revenue level continued to improve,and the gross profit margin of the Groups independent brand passenger vehicle business increased by 3.1 percentage points.Due to the impact of the significant squeeze on the viability of the non

271、-luxury passenger vehicles of joint ventures market and the continuous decline of the market share,the Groups joint-venture business responded by adopting a flexible business policy and pricing strategy to proactively offset the impact of the continuous decline in the market share of the non-luxury

272、passenger vehicles of joint ventures,the sales volume of the joint venture business for the period was approximately 1,397,400 units,representing a year-on-year decrease of approximately 15.6%.Due to the effect of stabilizing and improving macro economy,recovering demands of the consumer market and

273、the impetus from various favorable policies,the commercial vehicle market bottomed out and rebounded and achieved restorative growth.The sales volume of the Groups commercial vehicle business was approximately 343,400 units,representing a year-on-year increase of approximately 10.3%.The Groups comme

274、rcial vehicle business has the core independent research and development capability of the entire product chain,and the engine brand“Dragon Engine”of commercial vehicles leads the industry in terms of technical performance.The Group actively promoted its new energy strategy and brand enhancement,wit

275、h sales of new energy vehicles reaching approximately 348,000 units in the period,representing year-on-year growth,and the new energy vehicle sales as a proportion of the Groups sales increasing by 2.7 percentage points.The sales of the high-end brand,VOYAH,exceeded 50,000 units,representing a year-

276、on-year increase of 159.1%,with a transaction price of more than RMB250,000;the sales of the new model M-Hero 917 exceeded 1,000 units,with a transaction price of more than RMB700,000;and the sales of eGT reached 75,000 units.432023 Annual ReportManagement Discussion and Analysis(Continued)III.FINAN

277、CIAL ANALYSIS1.RevenueThe revenue of the Group for 2023 was approximately RMB99,315 million,representing an increase of approximately RMB6,652 million,or approximately 7.2%,as compared with approximately RMB92,663 million for the corresponding period of last year.The change in revenue was mainly fro

278、m Dongfeng Commercial Vehicle Co.,Ltd.,Dongfeng Liuzhou Motor Co.,Ltd.,Dongfeng Passenger Vehicle Company,and VOYAH Automobile Technology Co.,Ltd.20232022Sales RevenueSales RevenueRMB millionRMB millionPassenger vehicles42,54346,732Commercial vehicles49,53838,665Financing service6,1516,438Corporate

279、and others1,6031,222Elimination(520)(394)Total99,31592,663 1.1 Passenger Vehicle BusinessThe sales revenue of passenger vehicles of the Group for 2023 decreased by approximately RMB4,189 million,or approximately 8.96%,to approximately RMB42,543 million from approximately RMB46,732 million for the co

280、rresponding period of last year.The decrease in revenue was mainly from the passenger vehicles business of Dongfeng Passenger Vehicle Company and Dongfeng Liuzhou Motor Co.,Ltd.1.2 Commercial Vehicle BusinessIn 2023,due to the effect of stabilizing and improving macro economy,recovering demands of t

281、he consumer market and the impetus from various favorable policies,the commercial vehicle market bottomed out and rebounded and achieved restorative growth.The sales revenue of commercial vehicle business of the Group for the period was approximately RMB49,538 million,representing an increase of app

282、roximately RMB10,873 million or approximately 28.1%from approximately RMB38,665 million for the corresponding period of last year.The increase in revenue was mainly from the commercial vehicle business of Dongfeng Commercial Vehicle Co.,Ltd.and Dongfeng Automobile Co.,Ltd.44Dongfeng Motor Group Comp

283、any LimitedManagement Discussion and Analysis(Continued)1.3 Auto Financing Service BusinessIn 2023,the Group optimized the layout of the financing service to provide customers with customized financial service for the whole journey covering purchase,utilization and changes of vehicles.Affected by th

284、e decline in loan scale and loan interest rate,the revenue from financing service of the Group for the period decreased slightly compared with the corresponding period of last year.The revenue from financing service of the Group for 2023 decreased by approximately RMB287 million,or approximately 4.5

285、%,to approximately RMB6,151 million from approximately RMB6,438 million in the corresponding period of last year.2.Cost of Sales and Gross ProfitThe total cost of sales of the Group for 2023 was approximately RMB89,849 million,representing an increase of approximately RMB6,013 million,or approximate

286、ly 7.2%,as compared with approximately RMB83,836 million of the corresponding period of last year.In 2023,with intensifying competition in the automobile industry,the Group continued to improve its marketing capability and profitability to cope with the fierce competition of“reducing price to secure

287、 more sales”in the automobile market.The total gross profit for the period was RMB9,466 million,representing an increase of RMB639 million,or approximately 7.2%,as compared with RMB8,827 million of the corresponding period of last year.The gross profit margin for the period was 9.5%,which was basica

288、lly the same as that of the corresponding period of last year.The change of gross profit in this period was mainly due to the increase in gross profit of the Groups independent brand passenger vehicles(Aeolus series)and new energy business(VOYAH series)compared with the corresponding period of last

289、year,while that of the commercial vehicle business slightly declined due to the intensifying industrial competition and impacts of the sales structure.3.Other IncomeThe total other income of the Group for 2023 amounted to approximately RMB4,143 million,representing a decrease of approximately RMB1,8

290、88 million compared with approximately RMB6,031 million of the corresponding period of last year.The decrease in other income was mainly due to the investment gain from the disposal of Seres shares amounting to RMB1,945 million last year,while the investment gain from disposal of stocks was RMB79 mi

291、llion during this period.452023 Annual ReportManagement Discussion and Analysis(Continued)4.Selling and Distribution ExpensesThe selling and distribution expenses of the Group for 2023 increased by approximately RMB1,652 million to approximately RMB8,221 million from approximately RMB6,569 million o

292、f the corresponding period of last year.The increase in selling and distribution expenses was mainly due to:i).an increase in marketing expenses for the launch of new models such as VOYAH PASSION,DREAMER and FREE;ii).an increase in market development expenses in line with import and export business

293、as the Group actively expanded overseas markets;iii)an increase in marketing expenses of the Group compared with the corresponding period of last year with the launch of the new models in 2023.5.Administrative ExpensesThe administrative expenses of the Group for 2023 increased by approximately RMB18

294、3 million to approximately RMB5,309 million from approximately RMB5,126 million of the corresponding period of last year.The increase in administrative expenses was mainly due to the increase in staff salaries corresponding to the increase in new energy vehicle business and outbound export business

295、of the Group.6.Impairment Losses on Financial AssetsThe impairment losses on financial assets of the Group for 2023 decreased by approximately RMB134 million to approximately RMB1,075 million from approximately RMB1,209 million in the corresponding period last year.The changes in impairment losses o

296、n financial assets were mainly due to the decline in loan scale base number in line with the decrease in sales volume in the period.7.Other ExpensesThe other expenses of the Group for 2023 amounted to approximately RMB5,601 million,representing an increase of approximately RMB314 million as compared

297、 with approximately RMB5,287 million of the corresponding period of last year.The change in net of other expenses in the current period was mainly due to:1.The Group attaches great importance to the development trend of new energy,digitalization and intelligence in the automotive field,and continues

298、 to invest in research and development in strategic areas and key core technologies,hence research and development expenses continue to increase,an increase of about RMB177 million yuan over the same period;2.an increase in assets impairment loss as compared with the corresponding period.46Dongfeng

299、Motor Group Company LimitedManagement Discussion and Analysis(Continued)8.Finance ExpensesThe finance expenses of the Group for 2023 amounted to approximately RMB1,108 million,representing an increase of approximately RMB79 million as compared with approximately RMB1,029 million of the corresponding

300、 period of last year.The change in finance expenses in current period was mainly due to:1.the year-on-year decrease in interest expenses on borrowings;2.Euro bonds were affected by exchange rate fluctuations,and foreign exchange losses increased compared with the same period.9.Share of Profits and L

301、osses of Joint VenturesAffected by the declining market share of non-luxury vehicles of joint ventures year by year,share of profits and losses of joint ventures of the Group for 2023 decreased by approximately RMB11,371 million to approximately RMB513 million,from approximately RMB11,884 million of

302、 the corresponding period of last year.The change for the period was mainly due to:1.a decrease of approximately RMB4,188 million in respect of Dongfeng Motor Co.,Ltd.over the corresponding period;2.a decrease of approximately RMB4,694 million in respect of Dongfeng Honda Automobile Co.,Ltd.over the

303、 corresponding period;3.a decrease of approximately RMB1,224 million in respect of Dongfeng Honda Engine Co.,Ltd.over the corresponding period.10.Share of Profits and Losses of AssociatesShare of profits and losses of associates of the Group for 2023 amounted to approximately RMB807 million,represen

304、ting a decrease of approximately RMB55 million as compared with that of approximately RMB862 million of the corresponding period of last year.The main reason for the change is the decrease in investment income of Dongfeng Nissan Auto Finance Co.,Ltd.11.Income Tax ExpenseThe income tax expense of the

305、 Group for 2023 increased by approximately RMB1,357 million to approximately RMB428 million from approximately RMB-929 million in the corresponding period of last year.This was mainly due to the prudent revaluation of deferred tax assets to be recognized by some of the Groups subsidiaries.12.Profit

306、Attributable to Equity Holders of the Company for the YearThe loss attributable to the equity holders of the Group for 2023 was approximately RMB3,996 million,representing a decrease of approximately RMB14,261 million as compared with that of approximately profit of RMB10,265 million of the correspo

307、nding period of last year.The net profit margin(a percentage of profit attributable to the equity holders of the Company to total revenue)was approximately-4.0%,representing a decrease of approximately 15.1 percentage points as compared with approximately 11.1%of the corresponding period of last yea

308、r.The return on net assets(a percentage of profit attributable to equity holders of the Company to average equity attributable to equity holders of the Company)was approximately-2.6%.472023 Annual ReportManagement Discussion and Analysis(Continued)13.Total AssetsTotal assets of the Group as at the e

309、nd of 2023 amounted to approximately RMB330,678 million,representing an increase of approximately RMB642 million,or 0.2%,as compared with RMB330,036 million as at the end of last year.This was mainly due to:1.an increase of RMB14,281 billion in cash and cash equivalents,pledged bank balances and tim

310、e deposits and financial assets at fair value through profit or loss;2.an increase of RMB6,373 million in property,plant and equipment,investment properties and intangible assets;3.an increase of RMB4,464 million in bills receivable and financial assets at fair value through other comprehensive inco

311、me;4.a decrease of RMB12,813 million in prepayments,deposits and other receivables;5.a decrease of RMB9,587 million in amount due from joint ventures;6.a decrease of RMB1,843 million in trade receivables.14.Total LiabilitiesTotal liabilities of the Group as at the end of 2023 amounted to approximate

312、ly RMB171,069 million,representing an increase of approximately RMB6,569 million,or 4.0%,as compared with approximately RMB164,500 million as at the end of last year.The increase was mainly due to:1.an increase of RMB6,831 million in interest-bearing borrowings;2.an increase of RMB8,596 million in t

313、rade payables;3.an increase of RMB6,453 million in bills payable;4.an increase of RMB508 million in contract liabilities;5.a decrease of RMB15,521 million in amount due to jointly controlled entity;6.a decrease of RMB301 million in government grants.15.Total EquityTotal equity as at the end of 2023

314、of the Group amounted to approximately RMB159,609 million,representing a decrease of RMB5,927 million or 3.6%as compared with RMB165,536 million as at the end of last year,of which,equity attributable to equity holders of the Company amounted to RMB152,787 million,representing a decrease of RMB3,065

315、 million as compared with RMB155,852 million as at the end of last year;non-controlling interests amounted to RMB6,822 million,representing a decrease of RMB2,862 million as compared with RMB9,684 million as at the end of last year.16.Liquidity and Sources of CapitalNet inflow of cash and cash equiv

316、alents in 2023 of the Group was RMB7,055 million,representing a decrease of RMB9,006 million over 2022.This includes a net cash inflow from operating activities of RMB8,553 million,a net cash inflow from investing activities of RMB129 million and a net cash outflow from financing activities of RMB1,

317、627 million.48Dongfeng Motor Group Company LimitedManagement Discussion and Analysis(Continued)Net cash inflow from operating activities amounted to RMB8,553 million.The amount mainly consisted of:1.a decrease in cash flow of RMB7,705 million from loss before taxation and share of profits and losses

318、 of joint ventures and associates;2.an increase in cash flow of RMB5,210 million from depreciation and amortization;3.a decrease in cash flow of RMB1,819 million from impairment on trade and other receivables and other non-current assets,provision against inventories and impairment of items of prope

319、rty,plant and equipment;4.a decrease in cash flow of RMB1,528 million due to an increase in inventories;5.an increase in cash flow of RMB4,646 million due to a decrease in amount receivable from joint ventures;6.an increase in cash flow of RMB11,870 million due to an increase in trade and bills paya

320、bles,contract liabilities and other payables and accruals;7.an increase in cash flow of RMB13,623 million from loans,receivables and cash deposits received from financing services;8.a decrease in cash flow of RMB15,521 million due to a decrease in amount payable to joint ventures;9.a decrease in cas

321、h flow of RMB1,715 million from income tax expense.Net cash inflow from investing activities amounted to RMB129 million.The amount mainly consisted of:1.an increase in cash flow of RMB7,700 million due to the receipt of dividend;2.a decrease in cash flow of RMB11,859 million due to the expenses from

322、 purchase and disposal of fixed assets and intangible assets;3.an increase in cash flow of RMB8,284 million due to the disposal of investment in Stellantis;4.a decrease in cash flow of RMB4,100 million from non-pledged time deposits with original maturity over three months.Net cash outflow from fina

323、ncing activities amounted to RMB1,627 million.The amount mainly consisted of:1.a cash inflow of RMB25,711 million resulting from the increase in bank borrowings;2.a cash outflow of RMB23,236 million resulting from the repayment of bank borrowings and redeeming bonds;3.a payment of dividends of RMB2,

324、560 million;4.a payment for share repurchase of RMB963 million.As a result of the above,the Groups cash and cash equivalents(excluding non-pledged time deposits with original maturity of three months or more when acquired)amounted to RMB72,395 million as at 31 December 2023,representing an increase

325、of RMB7,151 million as compared with RMB65,244 million as at the end of the previous period.Cash and bank balances(including non-pledged time deposits with original maturity of three months or more when acquired)amounted to RMB79,297 million,representing an increase of RMB11,251 million as compared

326、with approximately RMB68,046 million as at the end of the previous period.17.Major Financial Figures Based on Proportionate ConsolidationBased on proportionate consolidation,the revenue of the Group for 2023 was approximately RMB199,816 million,representing a decrease of approximately RMB18,101 mill

327、ion,or approximately 8.31%,as compared with approximately RMB217,917 million of the corresponding period of last year.Loss before income tax was approximately RMB5,760 million,representing a decrease of approximately RMB18,367 million,or approximately 145.69%,as compared with approximately profit be

328、fore income tax of RMB12,607 million of the corresponding period of last year.Total assets were approximately RMB382,324 million,representing an increase of RMB12,201 million,or approximately 3.30%,as compared with approximately RMB370,123 million as at the end of last year.492023 Annual ReportMain

329、Work Experience of Directors,Supervisors and Senior Managers of the IssuerDIRECTORSYang Qing,Executive Director,Chairman and PresidentMr.Yang Qing,born in 1966,is a senior engineer with a bachelors degree in engineering.He is currently the executive director,president of the Company.He has worked at

330、 the second steam piston bearing factory since 1988.He has served successively as the deputy section chief and deputy chief engineer of the inspection department,the director,branch secretary of the Party Committee,the duty officer of the department of the steel pipe ring of the piston bearing facto

331、ry of Dongfeng Motor Corporation,the deputy general manager of Dongfeng Motor Piston Bearing Co.,Ltd.,the general manager of Dongfeng Auto Fasteners Co.,Ltd.,general manager of Dongfeng Axle Co.,Ltd.,executive deputy general manager of Dongfeng Dana Axle Co.,Ltd.,deputy general manager of Dongfeng M

332、otor Co.,Ltd.and Dongfeng Commercial Vehicle Co.,Ltd.,general manager of Dongfeng Automobile Co.,Ltd.,general manager of Dongfeng Commercial Vehicle Co.,Ltd.,deputy president of Dongfeng Motor Group Co.,Ltd.,general manager of Dongfeng Commercial Vehicle Co.,Ltd.and president of Dongfeng Motor Group

333、 Co.,Ltd.You Zheng,Executive Director and Vice PresidentMr.You Zheng,born in 1968,and is currently the executive director,vice president of the Company.Mr.You graduated from Jilin Institute of technology in 1990 with a Bachelor of Engineering Degree in Metal Materials and Welding.From 2010 to 2012,he studied in-service in the major of Business Administration for senior managers of Business School