Analysis of Yadea Holdings' Premium Strategy and the Balance Between Premiumization and Cost-Effectiveness

Based on the collected materials, I will systematically analyze how Yadea Holdings balances its premium strategy and cost-effectiveness advantages.

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Yadea Holdings’ premium strategy did not happen overnight, but rather went through nearly a decade of continuous deployment. In 2014, Yadea first put forward the strategic slogan of “a more premium electric vehicle”, initiating its transformation from a traditional cost-effective positioning to the mid-to-high-end market [1]. The core driving forces of this strategic transformation come from three aspects:

The electric two-wheeler market has long been in a state of homogeneous competition, with low product differentiation and light intelligent functions as the main intelligent features. The traditional price war model is unsustainable, and leading enterprises are seeking breakthroughs one after another. After the implementation of the new national standard in 2024, industry thresholds have been raised, and small and medium-sized enterprises have been cleared out at an accelerated pace, providing an opportunity for leading enterprises to pursue premiumization [2].

Yadea’s gross margin has long been lower than that of its competitors. In 2024, Yadea’s gross margin was 15.19%, while Ninebot’s gross margin reached as high as 28.24%, with a significant premium advantage brought by intelligence [1]. Facing profit pressure, premiumization has become an inevitable choice to improve profitability.

According to data from iResearch, in 2019, the proportion of consumers willing to buy electric two-wheelers priced above RMB 3,000 reached 27.5%, an increase of 3.2 percentage points compared with 2017 [3]. Consumption upgrade has provided market space for premium products.

Yadea adopts a stratified product strategy, maintaining its cost-effectiveness base while pursuing premiumization, forming a “pyramid” product structure:

Product Series	Target Group	Core Selling Points	Price Range
VFLY	High-net-worth urban users	Porsche design, intelligent configurations	RMB 6,999-19,800
Guanneng Series	Mid-to-high-end users	Long range (200km+), TTFAR 6.0 System	RMB 3,000-6,000
Modeng Series	Young female users	High appearance, 10-layer safety protection, Lady Mode	RMB 2,500-4,000
Basic Models	Price-sensitive users	Practicality, cost-effectiveness	RMB 1,500-2,500

• The sales share of products priced above RMB 3,000 increased from 48.4% in H1 2024 to 56.5% in H1 2025 [4]
• The average unit price rose from RMB 1,487 in 2024 to approximately RMB 2,300 in H1 2025 [5]
• The full-year average unit price in 2025 is expected to reach RMB 2,340-2,380, an increase of about 57% compared with 2024 [1]

Yadea’s continuous investment in R&D has provided a solid technological foundation for its premium strategy:

Indicator	2022	2023	2024	H1 2025
R&D Expenses (RMB 100 million)	11.06	11.92	11.47	6.24
R&D Expense Ratio	-	-	4.1%	-
Year-on-Year Growth	-	7.8%	-	27%

1. Graphene Battery Patent Technology
   : Improves driving range and addresses users’ core pain points
2. TTFAR 6.0 Long-Range System
   : The 6th-generation Guanneng series achieves a driving range of over 200 km [1]
3. Sodium-Ion Battery Technology
   : Launches a new generation of battery technology in 2025
4. Ark Safety Technology
   : TCS 2.0 Automatic Control System, HDC Hill Descent Control, etc.
5. Intelligent System
   : Basic intelligent functions such as app vehicle control, anti-theft positioning, etc.

However, compared with Ninebot, Yadea still lags in deep intelligence. Functions such as Ninebot’s RideyGo! and L2-level assisted driving are more technologically advanced, while Yadea’s intelligent functions are mostly basic, lacking in in-depth experiences such as AI interaction, OTA upgrades, and riding data analysis [1].

Yadea has over 40,000 offline stores, ranking first in the industry in terms of channel depth. This channel advantage has become a key support for its balance of premiumization and cost-effectiveness:

• Wide Coverage
  : High penetration in third- and fourth-tier cities, able to cover the vast number of consumers pursuing cost-effectiveness
• Convenient Experience
  : Consumers can experience products in offline stores, promoting sales of mid-to-high-end products
• Trade-in
  : During the policy dividend period in 2025, Yadea’s store terminal share ranked among the top in the industry, maximizing the capture of policy dividends [5]

• The VFLY premium sub-brand shares channels with the main brand and has not established an independent experience system, which may weaken its premium brand recognition [1]
• Premium models face greater sales difficulties in third- and fourth-tier city stores, and some stores are unwilling to display high-priced products

Indicator	2024	H1 2025	2025 (Estimated)	Year-on-Year Change
Operating Revenue (RMB 100 million)	282.36	191.86	-	+33.11%
Net Profit (RMB 100 million)	12.72	16.49	≥29	+128%
Gross Margin	15.2%	19.6%	-	+4.4 pct
Net Profit Margin	4.5%	8.6%	-	+4.1 pct

1. Performance Reversal
   : Net profit in H1 2025 has exceeded the full-year 2024 figure, with an expected full-year growth of 128%, marking remarkable results of the premium strategy [4][5]
2. Gross Margin Improvement
   : The gross margin in H1 2025 reached a record high of 19.6%, an increase of 4.4 percentage points compared with 2024 [4]
3. Product Structure Optimization
   : The increased share of products priced above RMB 3,000 has driven profitability improvement

In the high-end market, Yadea faces fierce competition from Ninebot and Niu Technologies:

Price Range	Yadea’s Share	Ninebot’s Share	Niu Technologies’ Share
Above RMB 7,000	4.1%	51.7%	43.8%
Above RMB 4,000	-	Leading	Leading

1. Avoid Direct Confrontation
   : Does not compete head-on with Ninebot and Niu Technologies in the ultra-high-end market, focusing on the mid-to-high-end market of RMB 3,000-6,000
2. Scale Advantage
   : Leverages its industry-leading sales volume to spread costs, achieving “premium without overpricing”
3. Channel Sinking
   : Covers third- and fourth-tier cities to avoid fierce competition in first- and second-tier cities
4. Brand Endorsement
   : Launches premium sub-brands such as VFLY to enhance brand image, while main sales products are still concentrated in the RMB 2,000-3,000 range

Yadea has cut prices sharply multiple times in the past (a maximum 30% price cut across the entire product line after its listing in 2016), leading to brand perception barriers for its premiumization. Consumers have a deep-rooted “cost-effective” label for Yadea, resulting in its ten-thousand-yuan products being “well-received but unsalable” [1].

Compared with Ninebot’s RideyFUN AIR intelligent driving system and Niu Technologies’ in-depth intelligent configurations, Yadea’s intelligent functions are relatively basic, making it difficult to meet young consumers’ pursuit of a sense of technology [3].

The premium sub-brand VFLY shares channels with the main brand, which may cause brand positioning ambiguity. Offline stores are unwilling to promote high-priced products, hindering the advancement of premiumization [1].

From November 2023 to April 2024, Yadea was listed on the unqualified product lists of local market supervision authorities 6 times. There were 3,321 related complaints on the Black Cat Complaint Platform, involving issues such as brake failure, battery spontaneous combustion, and after-sales evasion [1].

Over 90% of Yadea’s revenue comes from the domestic market. Compared with Emma’s European flagship store, Niu Technologies’ direct operations in 48 countries, and Ninebot’s global intelligent ecosystem, Yadea still needs to make more efforts in internationalization [1].

Yadea’s premium strategy has achieved phased results, but balancing premiumization and cost-effectiveness remains a long-term task:

• Continue to increase the share of products priced above RMB 3,000, with a target of over 60%
• Increase investment in intelligent R&D to narrow the technological gap with Ninebot
• Improve the VFLY independent experience store system to enhance premium brand recognition

• Establish a clear brand matrix, with the main brand defending the cost-effectiveness base and sub-brands attacking the high-end market
• Accelerate overseas layout to diversify domestic market risks
• Continue vertical integration of the supply chain to reduce costs and increase efficiency to support price competitiveness

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Yadea Holdings seeks to balance premiumization and cost-effectiveness through the combined strategy of “stratified products + technology-driven + channel reuse”. Its core logic is:

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The 2025 financial data verifies the effectiveness of this strategy—improved gross margin and doubled net profit growth indicate that the premium strategy has entered the harvest period. However, challenges such as entrenched brand perception and shortcomings in intelligence still take time to resolve. In the future, Yadea needs to continue investing in brand upgrading and technological breakthroughs to advance steadily on the path of premiumization.

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[1] QQ News - “The automotive industry may not realize that Yadea’s two-wheelers are more profitable than four-wheelers” (https://news.qq.com/rain/a/20260112A01SIR00)

[2] JW View - “Electric two-wheelers are selling like hotcakes! Yadea’s half-year profit exceeds full-year 2024, Ninebot’s net profit surpasses Emma’s” (https://www.jwview.com/jingwei/html/m/08-29/629983.shtml)

[3] Guosheng Securities Research Report - Ninebot (689009.SH): Intelligent Breakout in the Red Sea of the Industry

[4] BOCOM International Analysis - Yadea Holdings H1 2025 Performance Review

[5] Sanche Caiguan - “2025 Financial Report Insight: Yadea Breaks Through the Industry’s Profit Ceiling and Launches a Premium Breakout Battle” (https://cj.sina.cn/articles/view/6697701948/18f36d23c00102aof0)

[6] Debon Securities - Initial Coverage Report on Yadea Holdings (01585.HK): Policy + Market-Driven Accelerated Industry Concentration