On the evening of February 20, a significant event took place in the automotive industry, as Yang Song, the newly appointed CEO of Autohome, held his first earnings release meetingThis occasion was marked by the announcement that Haier Group had become Autohome's new controlling shareholderYang’s opening remarks set the tone for the evening, as he laid out the latest developments surrounding the company.

The day marked a monumental agreement between two giants in their respective fieldsHaier's subsidiary, KATAI, had taken a bold step by acquiring 200 million ordinary shares of Autohome from Ping An's Yunchen Capital for an impressive $1.8 billion, which equates to approximately 130 billion yuanWith this transaction completed, KATAI now holds a 41.9% share, making it the actual controlling entity of Autohome.

Yang underscored the significance of this strategic investment by Haier, suggesting it represents recognition of Autohome's business model and market potentialHe expressed his optimism about the potential infusion of vitality this investment would bring for the company’s long-term growthThe new controlling stockholder's emphasis on team stability was also notable, as it was reported that no layoffs would occur due to the transaction; rather, there was a strong endorsement of the existing team’s value.

Yang Song's elevation within the company signals Haier's friendly stance towards Autohome, reflecting a desire for a smooth transition in leadership amidst significant changesAt 52 years old, Yang comes to the role well-equipped with a wealth of experienceBorn in Leshan, Sichuan, and a graduate of Fudan University, he boasts over two decades of experience in the automotive industry, having held leadership positions in various automotive enterprises.

During an interview in 2021, when he served as President of Changan Ford's national sales service organization, Yang came across as humble and open, addressing all concerns raised by reporters thoughtfully

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Later that same year, he joined Autohome as a Senior Vice President, overseeing various sectors including OEMs, new retail, used cars, and the ‘Everyday Auctions’ serviceDespite initially not being included in Autohome's senior management until late 2023, the change in major shareholders presented him an opportunity to advance.

The announcement regarding his appointment as Executive Director and CEO notes that Yang possesses valuable qualifications and the experience needed to best serve the company's interests, promising a challenging yet exhilarating responsibility ahead.

Managing a publicly listed company with a market value exceeding 27 billion Hong Kong dollars is no small featYang’s new position requires him to gain the recognition and trust of Haier Group, a company whose culture he has yet to experience firsthand, having never worked in the home appliance industryThis necessitates an immense amount of courage and a willingness to embrace a steep learning curve as he embarks on this new chapter.

While looking upward towards the expectations of Haier, Yang simultaneously finds himself addressing expectations from the board of directors at Autohome, where he stands as the only executive director among four board members, three of whom come from Ping AnFollowing the share transfer, Yunchen Capital continues to hold 23.92 million shares, remaining a stakeholder in AutohomeBuilding trust and collaborative synergy among colleagues presents a substantial challenge that Yang will need to navigate carefully.

Interestingly, this change in leadership occurred concurrently with the resignation of former CEO Wu Tao, who had significant ties to the Ping An GroupWu had first joined Autohome in 2016, serving as Vice President, before departing four years laterIn December 2023, he reassumed the CEO position, but after just one year in office, the majority shareholder shifted, leading to Yang's elevation.

Amidst the evolving dynamics, it is clear that Haier places particular emphasis on the used car segment of Yang's operational portfolio

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The 'Everyday Auctions' service under Autohome has grown considerably, achieving over one million transactions and accumulating a GMV of around 170 billion yuan as of September 2024. In the used car marketplace, KATAI has also been active, acquiring several businesses to establish a chain dedicated to mid-to-high-end used cars.

The development of KATAI's operations is impressive, with stores established across 18 cities, achieving a remarkable presence within the top dealers of China’s auto retail sectorIndustry insiders have lauded the mutual collaboration potential, given that Autohome stands as a leading platform in the automotive industry with considerable user trafficFollowing the transaction announcement, a source within KATAI expressed optimism and confidence regarding the future.

As the two companies look to harmonize their operations, Yang emphasized the complementary nature of Autohome's O2O online and offline strategies with KATAI's business modelHaier’s investment is expected to empower Autohome as a central hub within the group’s automotive ecosystemWhile addressing inquiries regarding the reasoning behind the acquisition, Yang refrained from commenting on Haier’s investment strategies but expressed confidence that the merger stems from well-rounded considerations on both sides.

He indicated that the integration of resources and expertise could yield synergistic benefits, helping them tackle the fierce competition within the automotive sectorAs they advance into the future, Yang expressed his belief that collaboration would be crucial, especially in light of the projected slight increase in retail sales by just 2% by 2025, a point which places pressure on both new shareholders and the management team to devise effective strategies.

As Yang takes charge amidst changing patterns, the profitability of Autohome has shown signs of diminishingThe projected income for 2024 stands at 7.04 billion yuan and a net profit of approximately 1.68 billion yuan—a 13.1% decrease year-over-year

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The company's revenue streams span three key areas: media services, lead generation, and online marketing among others.

Media services, generating advertising revenue from car manufacturers, have experienced a drop in clientele, decreasing to just 96 companies in 2023. This was primarily attributable to tighter budgets surrounding advertising, a consequence of the industry’s broader focus on cost reduction.

In previous years, media services contributed nearly 50% of total revenue, yet it has dwindled to roughly 20% in the current fiscal environmentThe lead generation service, focused on providing sales leads to dealers, has emerged as the predominant source of incomeIn contrast, online marketing, covering both new and used car transactions, has grown significantly, with revenues reaching approximately 2.38 billion yuan.

Despite rising platform traffic, challenges remain within the industry landscapeAs Yang pointed out during the earnings conference, based on data from QuestMobile, the daily active users on the Autohome mobile platform reached 77.48 million as of December 2024, marking a 13.6% year-over-year increase, underscoring the effectiveness of a content-driven approach.

However, as competition intensifies, car manufacturers are redirecting their advertising expenses towards platforms with a broader audience, such as Douyin and XiaohongshuThis shift creates increased pressure on vertical platforms like AutohomeAcknowledging these challenges, new investors are stepping in to provide their support.

During the meeting, Liu Chi, a board member of Haier Group and chairman of KATAI, conveyed optimism regarding Autohome's extensive user base and its diverse business setups despite being subject to challenges posed by declining traffic within vertical mediaAs Yang embarks on this new journey as CEO, the task ahead will prove to be an arduous one, filled with immense potential yet accompanied by equally significant hurdles in this transformative sector.

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