Changan Begins Integrating Avatr and Deepal in Push for 1.5 Million Global Sales

Changan Starts Folding Avatr and Deepal Operations Into One Synergy Unit

Changan Automobile has started merging parts of its two new energy vehicle brands, Avatr and Deepal, through a new AD Synergistic Development Department, with the initials taken from the two brand names. The unit will house secondary departments for planning and cooperation, marketing and products, and shared centres for human resources and finance, alongside a general affairs function, according to information obtained by Yicai.

The restructuring goes beyond administration. Changan has proposed that Avatr set up shared or collaborative centres for styling design, product development and platform technology to handle work entrusted by Deepal. Deepal, for its part, is expected to dissolve several business units and their subordinate organisations.

The integration follows Changan's April announcement that the two brands would pursue comprehensive strategic collaboration, with a target of building a mid-to-high-end brand group with annual global sales above 1.5 million vehicles and overseas sales accounting for more than 40%. Chairman Zhu Huarong said at the time that each brand's strategy and independent operation would remain unchanged, while they would share system capabilities and resources, including technology and supply chains.

Avatr, founded in July 2018, sold 120,000 vehicles last year and counts Changan as its largest shareholder with a nearly 41% stake. Huawei Technologies supplies intelligent driving and cockpit technologies. Deepal, launched as a brand in April 2022, sold 333,000 vehicles globally last year, up 37%, with overseas markets contributing around 10%.

Inside the Avatr-Deepal Integration: Costs, Huawei and the Hong Kong Listing

Why Changan Is Centralising Rather Than Merging

The structure described so far is an integration of back-office and development functions, not a full merger of the two brands. That matters because Avatr occupies a higher-priced, Huawei-linked position while Deepal is a higher-volume mid-to-high-end line. Keeping the brands independent while sharing costs in design, platforms and supply chains is a way to lift volumes toward the 1.5 million target without blurring their consumer identities. This is consistent with Chairman Zhu Huarong's April statement that strategy and independent operation would remain unchanged.

The Huawei Dimension

Avatr's close collaboration with Huawei on intelligent driving and cockpit technology makes the restructuring sensitive. If Avatr's shared platform work extends into technology Deepal also uses, Changan could spread Huawei-linked capabilities across a larger volume base, lowering per-vehicle costs. That is an interpretation based on Changan's stated plan to share technology and supply chain resources; the exact scope of Huawei involvement in the new shared centres has not been disclosed.

The Scale Gap Behind the Target

Last year Avatr and Deepal sold a combined 453,000 vehicles. Reaching 1.5 million therefore requires more than a threefold increase in volume, and lifting overseas sales from Deepal's current 10% share to more than 40% of the group total is a major geographic shift. Sharing platform, styling and product development work is one way Changan is trying to reduce the duplication that would make a push of that size more expensive. But the target remains highly ambitious and depends on models, export markets and demand that have not yet been specified.

The Hong Kong IPO Question

One of the most concrete market questions is whether the restructuring complicates Avatr's planned Hong Kong listing. Avatr filed an application in November last year and refiled in June after its earlier prospectus lapsed. Avatr Technology President Chen Zhuo has said the strategic restructuring with Deepal will not affect the plan to list in Hong Kong. Investors will still want to see how the shared functions, asset boundaries and financial reporting are structured as the IPO proceeds.

What Changan's Restructuring Plan Means for Investors, Suppliers and Rivals

• Track the Avatr Hong Kong listing documents. Avatr refiled in June after its November prospectus lapsed, and President Chen Zhuo says the Deepal restructuring will not affect the plan. The next prospectus updates should show whether shared functions are treated as related-party arrangements or fully absorbed, which matters for margin disclosure.
• Watch Deepal's business-unit dissolutions. The company is expected to dissolve several units and subordinate organisations. Supplier and partner contracts tied to those units may need renegotiation or transfer once the integration plan is formally published.
• Use the 1.5 million and 40% targets as a credibility check. The two brands sold a combined 453,000 vehicles last year, so the plan implies more than a threefold volume increase and a major shift in overseas mix. Quarterly sales by brand and export share will be an early test of whether the centralisation is translating into growth.
• For suppliers and technology partners, prepare for shared platform demand. Changan has said Avatr will handle styling design, product development and platform technology entrusted by Deepal. Suppliers should clarify whether existing Deepal or Avatr contracts now sit under the new integrated centres.