EHang Holdings Ltd (EH) 2024 Q2 法說會逐字稿

Good day, ladies and gentlemen, thank you for standing by, and welcome to the EHang second quarter of 2024 earnings conference call. As a reminder, we are recording today's call.

女士們、先生們，大家好，感謝大家的支持，歡迎參加億航 2024 年第二季財報電話會議。提醒一下，我們正在錄製今天的通話。

Now we will turn the call over to Anne Ji, EHang's Senior Director of Investor Relations.

現在我們將電話轉給億航投資者關係高級總監 Anne Ji。

Ms. Anne, please proceed.

安妮女士，請繼續。

Hello, everyone. Thank you all for joining us on today's conference call to discuss the Company's financial results for the second quarter of 2024. The earnings release is available on the Company's IR website. Please note the conference call is being recorded and the audio replay will be posted on the Company's IR website.

大家好。感謝大家參加今天的電話會議，討論公司 2024 年第二季的財務表現。收益報告可在公司的 IR 網站上查閱。請注意，電話會議正在錄音，音訊重播將發佈在該公司的 IR 網站上。

On the call today, we have Mr. Huazhi Hu, our Founder, Chairman, and Chief Executive Officer; Mr. Zhao Wang, Chief Operating Officer; and Mr. Conor Yang, Chief Financial Officer and Director of the Board. The management team will successively give prepared remarks. Remarks delivered in Chinese will be followed by English translations. All translation is for convenience purpose only. In the case of any discrepancy, management's statement in the original language will prevail. A Q&A session will follow afterwards.

參加今天電話會議的有我們的創辦人、董事長兼執行長胡華志先生、營運長王昭先生以及財務長兼董事會成員楊康先生。管理團隊將依序發表準備好的發言。中文發言後將附有英文翻譯。所有翻譯僅是為了方便目的。如有任何差異，以管理階層原文聲明為準。隨後將進行問答環節。

Before we continue, please note that today's discussion will contain forward-looking statements made pursuant to the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements involve the inherent risks and uncertainties. As such, the Company's actual results may be materially different from the expectations expressed today. Further information regarding these and other risks and uncertainties is included in the Company's public filings with the SEC. The Company does not assume any obligation to update any forward-looking statements, except as required under applicable law. Also, please note that all numbers presented are in RMB and are for the second quarter of 2024, unless stated otherwise.

在我們繼續之前，請注意，今天的討論將包含根據 1995 年美國私人證券訴訟改革法案的安全港條款做出的前瞻性陳述。前瞻性陳述涉及固有的風險和不確定性。因此，公司的實際業績可能與今天表達的預期有重大差異。有關這些和其他風險和不確定性的更多資訊包含在公司向美國證券交易委員會提交的公開文件中。除適用法律要求外，本公司不承擔更新任何前瞻性聲明的義務。另外請注意，除非另有說明，所有數字均以人民幣為單位，且為 2024 年第二季的數字。

With that, let me now turn the call over to our CEO, Mr. Huazhi Hu. Please go ahead, Mr. Hu.

現在，我將把電話轉給我們的執行長胡華志先生。胡先生，請講。

(interpreted) This is the English translation of Mr. Hu's remarks.

（翻譯）這是胡先生講話的英文翻譯。

Hello, everyone. Thank you for joining EHang's earnings call. Since the second quarter of this year, as a leading company in the eVTOL industry, EHang has achieved remarkable results in multiple aspects, including financial performance, orders and deliveries, production ramp-up, industry standards and certifications, operation sites deployment, and the R&D of next-generation technologies and products. This is enabling us to continue leading the global urban air mobility (UAM) industry.

大家好。感謝您參加億航的財報電話會議。今年第二季以來，作為eVTOL行業的領導企業，億航在財務表現、訂單交付、產能爬坡、行業標準與認證、營運場地部署、下一代技術與產品研發等多個方面都取得了令人矚目的成就。這使我們能夠繼續引領全球城市空中交通 (UAM) 產業。

This April, we successfully obtained the Production Certificate, which is the PC for our EH216-S. We are proud to be the world's only eVTOL designer, developer, and manufacturer to possess three certifications for the pilotless passenger-carrying eVTOL aircraft.

今年四月，我們成功獲得了生產證書，這是我們EH216-S的PC。我們很自豪能夠成為世界上唯一擁有三個無人駕駛載客 eVTOL 飛機認證的 eVTOL 設計者、開發者和製造商。

With these three certifications in hand, we have also benefited from China's favorable policies that bring strong support for the development of the low-altitude economy as a national strategic emerging industry. Driven by the widespread development plans across the country and the strong market demand for innovative, low-altitude aircraft, our eVTOL products, as representatives of new quality productive forces promoted by the nation, have garnered a large number of customers and bulk orders.

在獲得這三項認證的同時，我們也受惠於國家利好政策，對低空經濟作為國家戰略新興產業的發展給予了大力支持。在國家大力發展低空飛行器和創新低空飛行器市場旺盛需求的帶動下，作為國家大力推廣的高品質新生產力代表，公司eVTOL產品已獲得大量客戶和大量訂單。

Our delivery volume and revenues both reached record highs in Q2. We delivered 49 units of EH216-S, a 9-fold increase year-over-year. Quarterly revenues surged to RMB102 million, also a 9-fold increase year-over-year and a 65% increase quarter-over-quarter. Moreover, we achieved quarterly adjusted net income, earlier than we expected, which marks a very promising start. The Company's Q2 gross margin was as high as 62.4%, with both year-over-year and quarter-over-quarter increase.

我們第二季的交付量和營收均創下歷史新高。我們交付了49台EH216-S，年增9倍。當季營收飆升至1.02億元人民幣，較去年同期成長9倍，較上季成長65%。此外，我們實現了季度調整後淨收入，比我們預期的要早，這是一個非常有希望的開始。該公司第二季毛利率高達62.4%，與去年同期相比均有所提升。

Since Q4 last year, we have received over 1,100 units in bulk pre-orders in the Chinese market, and this number is continuing to grow. After securing the PC, our Yunfu production facility has started a production ramp-up of certified EH216-S. We will continue to improve production efficiency strictly in accordance with aircraft production procedures and quality management systems, and steadily increase our production and deliveries according to the customer's order requests.

自去年第四季以來，我們在中國市場已收到超過1,100台的大量預訂單，而且這個數字還在持續成長。在獲得 PC 後，我們的雲浮生產工廠已開始加大經過認證的 EH216-S 的生產。我們將嚴格按照飛機生產流程和品質管理系統不斷提高生產效率，並根據客戶的訂單要求穩步提高產量和交付量。

To meet the continuous delivery of long-term bulk orders, we are also planning for future production capacity expansion. Based on the four-party strategic cooperation agreement we signed in Q1 this year with the Management Committee of Guangzhou Airport Economic Zone, the Administrative Committee of Guangzhou Economic and Technological Development District, and GAC, which is Guangzhou Automobile Group, we further signed a MoU with GAC in June with the intent to establish a joint venture. This joint venture will leverage GAC's expertise and advantages in intelligent manufacturing and automated production lines for electric vehicles to produce pilotless passenger-carrying aircraft in Guangzhou. We look forward to this cooperation to further enhance our future production capacity, which will allow us to respond to market demand more quickly and lift the efficiency and scale of our product deliveries.

為了滿足長期大宗訂單的持續交付，我們也正在規劃未來的產能擴張。在今年第一季與廣州空港經濟區管理委員會、廣州經濟技術開發區管理委員會、廣汽集團簽署的四方戰略合作協議的基礎上，我們又於6月份與廣汽集團簽署了成立合資公司的諒解備忘錄。該合資公司將利用廣汽集團在電動車智慧製造和自動化生產線的專業知識和優勢，在廣州生產無人駕駛載客飛機。我們期待此次合作能進一步提升我們未來的生產能力，讓我們能夠更快地回應市場需求，提升產品交付的效率和規模。

Delivery is merely the starting point, whether for EHang or our customers. Equally important are the provision of exceptional after-sales support, personnel training, site planning, operational standards, and system development. Our current customer service and business focus are both sales and operations, while maintaining a steady stream of product deliveries and ensuring safe operations. As a global pioneer of pilotless eVTOL provider, we are taking the responsibility to explore commercial operations through collaborating closely with regulatory authorities, customers, and partners to co-create a sustainable ecosystem that fosters the industry's growth and development.

無論對於億航還是我們的客戶來說，交付只是一個起點。同樣重要的是提供卓越的售後支援、人員培訓、場地規劃、營運標準和系統開發。我們目前的客戶服務和業務重點是銷售和運營，同時保持穩定的產品交付並確保安全運作。作為全球無人駕駛eVTOL的先驅，我們肩負著探索商業運營的責任，透過與監管機構、客戶和合作夥伴密切合作，共同打造一個促進行業增長和發展的可持續發展的生態系統。

With that, we are focusing on three key areas in which we have achieved significant progress.

為此，我們將重點放在已取得重大進展的三個關鍵領域。

The first one is talent cultivation. We have developed customized eVTOL aircraft personnel training program and assessment system, designed to equip our customers with qualified operational teams, ensuring safe operations.

一是人才培育。我們制定了客製化的eVTOL飛行器人員培訓計畫和評估體系，旨在為客戶配備合格的營運團隊，確保安全運作。

Secondly, infrastructure development. We not only actively participated in the formulation of China's first group standard for technical requirements of eVTOL vertiports, but also collaborated with local governments and customers to establish EH216-S vertiports and low-altitude urban air mobility operation center demonstration projects in Guangzhou, Hefei, Shenzhen, Zhuhai, Taiyuan, and Wencheng, among other locations.

第二，基礎建設。我們不僅積極參與我國首部電動垂直起降機場技術要求團體標準的製定，還與地方政府和客戶合作，在廣州、合肥、深圳、珠海、太原、文成等地建立了EH216-S垂直起降機場和低空城市空中交通運營中心示範項目。

Thirdly, operational standards and certification. In July, the CAAC accepted the Air Operator Certificate, or OC applications submitted by EHang General Aviation and Hefei Heyi Aviation. As the world's first OC project for the pilotless passenger-carrying eVTOL aircraft, it is paving the way for the establishment of the world's first commercial operation standard for pilotless passenger-carrying eVTOLs.

第三，操作標準和認證。7月，中國民航局受理了億航通航、合肥合一航空提交的航空運營人許可證（OC）申請。作為全球首個無人載客eVTOL飛行器OC項目，該項目為全球首個無人載客eVTOL商業運營標準的製定奠定了基礎。

As an innovative technology company, we will not slow down our pace in R&D for new products and technologies while pushing forward with sales and operations.

作為一家創新科技公司，我們在推動銷售和營運的同時，不會放慢新產品、新技術的研發步伐。

Building on the VT-30 prototype, we have conducted a comprehensive redesign and technological upgrade of our lift-and-cruise eVTOL model, aiming to achieve more exceptional flight performance. We will be releasing this soon, so please stay tuned for the exciting news.

在VT-30原型機的基礎上，我們對升力巡航eVTOL模型進行了全面的重新設計和技術升級，旨在實現更卓越的飛行性能。我們將很快發布此消息，請繼續關注這一令人興奮的消息。

We are also continuously optimizing the performance of our EH216-S. In the critical area of battery technology, we are developing next-generation eVTOL battery solutions that meet the 4H standards, which means high energy density, high cycle life, high instantaneous charge-discharge rate, and high safety. For example, in April, we partnered with Greater Bay Technology, a battery provider incubated by Guangzhou Automobile Group, for the research and development of the world's first Ultra-Fast Charging battery solutions for eVTOLs. This is expected to significantly improve eVTOL’s operational efficiency and meet the demands of large-scale, high-frequency UAM operations. Furthermore, we are also testing the solid-state lithium battery cells developed in collaboration with Inx.

我們也在不斷優化EH216-S的效能。在電池技術這一關鍵領域，我們正在開發符合 4H 標準的新一代 eVTOL 電池解決方案，即高能量密度、高循環壽命、高瞬時充放電率和高安全性。例如，今年4月，我們與廣汽集團孵化的電池供應商大灣科技合作，研發全球首個用於eVTOL的超快速充電電池解決方案。這有望顯著提高 eVTOL 的運作效率，並滿足大規模、高頻率的 UAM 營運需求。此外，我們也正在測試與Inx合作開發的固態鋰電池單元。

Meanwhile, we are also continuously researching and developing new technologies and solutions for core components such as electric motors, propellers, and materials iterating and upgrading them to achieve sustained improvements. We have also cooperated with more high-quality suppliers, such as Zhuhai Enpower Electric Company, a leading EV powertrains provider, into our ecosystem. This not only enhances the flight performance of our aircraft, but also helps to strengthen the stability of our supply chain and supports our industrial layout.

同時，我們也不斷研發電機、螺旋槳、材料等核心零件的新技術、新方案，並進行迭代升級，以實現持續改善。我們也與更多優質供應商合作，例如領先的電動車動力總成供應商珠海英寶電氣有限公司，將其納入我們的生態系統。這不僅提升了我們飛機的飛行性能，也有助於加強我們供應鏈的穩定性，並支持我們的產業佈局。

Also, our newly upgraded R&D laboratories are nearing completion at our new headquarters, designed to support the development and testing of new technologies and components such as batteries and electric motors.

此外，我們新總部新升級的研發實驗室即將完工，旨在支援電池和電動馬達等新技術和組件的開發和測試。

I'm also delighted to share with you that our new headquarters and supporting facilities, located on the banks of the Pearl River in Guangzhou's Huangpu District, are currently under construction. This complex will feature a state-of-the-art exhibition center, a brand-new command and control center, and a futuristic office space. Furthermore, we will integrate with the surrounding communities and commercial complexes to launch aerial sightseeing and transportation routes with our eVTOLs, connecting ground, air, and water transportation, and creating a new urban landmark, EHang Future City, as well as a UAM demonstration area for low-altitude economy in the Greater Bay Area.

我也很高興告訴大家，我們位於廣州市黃埔區珠江畔的新總部及配套設施目前正在興建中。該綜合體將設有最先進的展覽中心、全新的指揮和控制中心以及未來主義的辦公空間。同時，我們將與週邊社區、商業綜合體融合，利用電動垂直起降飛機開闢空中觀光及交通線路，打通地面、空中、水路交通，打造億航未來城城市新地標及粵港澳大灣區低空經濟城市空中交通示範區。

As we celebrate EHang's 10th anniversary, we reflect on our journey from humble beginnings to becoming a global trailblazer and leader in the UAM industry. Throughout, we have remained steadfast in our commitment to exploring pilotless passenger-carrying aircraft and its applications, driving innovations in technologies, concepts, and standards. From pioneering the world's first pilotless passenger-carrying eVTOL prototype to achieving the safe and reliable flights of pilotless eVTOLs; from the absence of industry standards to establishing and shaping them, and subsequently obtaining the world's first type certificate, production certificate, and standard airworthiness certificate, we have consistently pushed boundaries from 0 to 1 through innovations and perseverance, contributing to shaping this urban air mobility industry.

值此億航成立十週年之際，我們回顧了億航從默默無聞到成為城市空中交通 (UAM) 行業全球開拓者和領導者的歷程。我們始終堅定不移地致力於無人駕駛載客飛機及其應用的探索，推動技術、理念和標準的創新。從率先研製出全球首架無人駕駛載人eVTOL原型機，到實現無人駕駛eVTOL的安全可靠飛行；從沒有行業標準到建立、塑造行業標準，再到獲得全球首個型號合格證、生產許可證和標準適航證，我們始終以創新和堅持，從0到1不斷突破界限，為塑造城市空中交通行業貢獻。

Today, our years of hard work and dedication have led to strong and stable financial performance and long-term growth trajectory. With our passion and respect for the aviation industry, we will continue to drive forward into the next exciting phase of commercial operations, creating greater value for our stakeholders, supporters, and shareholders.

今天，我們多年的辛勤工作和奉獻精神帶來了強勁穩定的財務表現和長期的成長軌跡。懷著對航空業的熱情和尊重，我們將繼續向商業運營的下一個令人興奮的階段邁進，為我們的利害關係人、支持者和股東創造更大的價值。

Next, let me turn the call over to our COO, Mr. Wang, to elaborate on our Q2 operational performance. Thank you.

接下來，請容許我把電話轉給我們的營運長王先生，詳細說明我們第二季的營運表現。謝謝。

Thank you, Mr. Hu, and hello, everyone.

謝謝胡先生，大家好。

Since securing the production certificate in April, we have been authorized for mass production of our EH216-S and secured standard airworthiness certificate for each aircraft that we have delivered. Our sales and deliveries continued to grow. In the second quarter, we delivered 49 units of EH216-S, generating revenue of RMB102 million, representing a year-over-year increase of over 9 times and a quarter-over-quarter increase of 65%.

自四月獲得生產證書以來，我們已獲得批量生產 EH216-S 的授權，並為我們交付的每架飛機獲得了標準適航證書。我們的銷售額和交付量持續成長。第二季度，我們交付了49台EH216-S，營收1.02億元，年增超過9倍，季增65%。

Let me highlight some key examples of customers and partnerships: In June, we partnered with Wencheng in Zhejiang Province, and received a purchase order with an additional purchase plan for up to 300 units of EH216-S. We have already delivered the first batch of 27 units in the second quarter and conducted the debut flight at a local scenic area in Wencheng. The customer also made a prepayment for the remaining aircraft and subsequent orders will be placed as the customer expands its operations. Wencheng has become our first authorized distributor in East China to obtain provincial-level distribution qualifications and will establish a comprehensive sales network for our aircraft across Zhejiang Province.

讓我重點介紹一些客戶和合作夥伴關係的關鍵範例：6 月份，我們與浙江省文成市合作，並收到了一份採購訂單，並計劃額外購買多達 300 台 EH216-S。我們已於第二季交付首批27架飛機，並在文成當地風景名勝區進行了首飛。客戶也為剩餘的飛機支付了預付款，隨著客戶業務的擴大，將會下達後續訂單。文成公司已成為我公司華東地區首家獲得省級經銷資質的授權經銷商，將在浙江省範圍內建立我公司飛機的全面銷售網絡。

We also delivered the first batch of 10 units of EH216-S to Xishan Tourism for low-altitude tourism services in Taiyuan. In July, EH216-S completed its debut passenger-carrying flights in Taiyuan, marking a milestone for the development of the low-altitude economy in Shanxi Province. This delivery is part of a 50-unit order from Xishan Tourism that has been fully paid, with the customer plans to purchase an additional 450 units over the next two years. These units will be deployed in landmark scenic areas in Taiyuan and create a series of low-attitude tourism demonstration products, further advancing the construction of the low-attitude economy demonstration area in Shanxi Province.

並向西山旅遊交付首批10台EH216-S，用於太原低空旅遊服務。7月，EH216-S飛機在太原完成首航載客飛行，成為山西省低空經濟發展的里程碑。此次交付的是西山旅遊50台訂單的一部分，該訂單已全額付款，客戶計劃在未來兩年內再購買450台。這些單位將佈置太原市標誌性景區，打造一系列低空旅遊示範產品，進一步推動山西省低空經濟示範區建設。

Furthermore, in Q2, EHang also delivered EH216-S to our customers in Guangdong, Hainan, Jilin, Liaoning, and Japan.

此外，第二季億航也向廣東、海南、吉林、遼寧、日本等地客戶交付了EH216-S。

In July, we signed a sales and operation corporation agreement with KC Smart Mobility, a subsidiary of Hong Kong's largest non-franchised bus operator-- Kwoon Chung Bus Holdings Limited. KC Smart Mobility plans to purchase 30 units of EH216-S for development and operations in Hong Kong, Macau, and Hubei Province, further boosting market development in Great Bay Area and Mainland China.

7月，我們與香港最大的非營利巴士營運商冠忠巴士集團有限公司旗下的KC Smart Mobility簽署了銷售及營運合作協議。KC Smart Mobility計畫採購30台EH216-S，用於香港、澳門及湖北省的開發和運營，進一步推動粵港澳大灣區及中國內地的市場發展。

Our company has received over 1,000 units pre-orders for the EH216 series eVTOLs in China market. With the production capacity expansion, we expect to maintain a growing delivery trend in the third quarter. We anticipate the revenues of the third quarter will reach RMB123 million, as we continue to receive more new orders.

本公司EH216系列電動垂直起降飛機在中國市場已獲得超過1,000台預訂單。隨著產能擴張，我們預計第三季交付量將維持成長趨勢。隨著我們繼續獲得更多新訂單，我們預計第三季的營收將達到 1.23億元人民幣。

The increasing orders also mean a higher demand for production capacity. While ensuring that every aircraft meets delivery standards, we are also actively working with large intelligent manufacturing enterprises such as GAC to establish a joint venture focused on production, upgrading to automated production lines. At the same time, we are expanding our Yunfu factory to scale up our production and establishing a new manufacturing base at EHang East China Regional Headquarters in Hefei City, which will meet the growing delivery demands in the East China region.

訂單的增加也意味著對產能的需求更高。在確保每一架飛機都符合交付標準的同時，我們也積極與廣汽等大型智慧製造企業合作，成立專注於生產的合資公司，升級為自動化生產線。同時，我們正在擴大雲浮工廠，擴大生產規模，並在合肥市億航華東區域總部建立新的製造基地，以滿足華東地區日益增長的交付需求。

We are fully committed to ensuring production and delivery, while advancing commercial operation preparations, providing customers with operation training, and creating application demonstration projects.

我們全力保障生產交付，同時推動商業營運準備，為客戶提供營運培訓，打造應用示範專案。

In terms of operation personnel training, we provide our customers with sufficient training courses after the delivery, including theoretical learning, aircraft safety operation, daily maintenance, and emergency management, etc., to ensure that the personnel are certified and on duty to ensure operation safety. This comprehensive training program ensures that our customers are capable of operating our eVTOL aircraft in a proficient and compliant manner and providing safe flight services to the public.

在運行人員培訓方面，我們在交付後為客戶提供充足的培訓課程，包括理論學習、飛機安全操作、日常維護、緊急處置等，確保人員持證上崗，確保運作安全。這項全面的培訓計劃確保我們的客戶能夠熟練且合規地操作我們的 eVTOL 飛機，並為公眾提供安全的飛行服務。

At the same time, we also plan to cooperate with domestic aviation colleges and professional institutions to carry out personnel training, and jointly establish systems for the academic education, license management, etc., for the industry's future large-scale, standardized, and professional operations. Our joint training program with the Civil Aviation Flight University of China is now in the state of curriculum design.

同時，我們也計畫與國內航空院校及專業機構合作進行人才培養，共同建立學歷教育、執照管理等體系，為產業未來規模化、標準化、專業化運作奠定基礎。我們與中國民航飛行學院的聯合培養計畫目前正處於課程設計階段。

On the operational infrastructure front, EHang collaborates closely by providing technical requirements and design solutions, while the infrastructure construction is managed by local governments and our customers. Operation sites in key locations have been launched, including Shenzhen OH Bay, Hefei Luogang Central Park, Guangzhou Jiulong Lake, Zhuhai Tangjia Port, and Wencheng Tianding Lake. Each of these sites is equipped with facilities including dedicated vertiports for EH216-S, hangars, and the passenger service areas, etc.

在營運基礎設施方面，億航透過提供技術要求和設計解決方案進行密切合作，而基礎設施建設則由當地政府和我們的客戶管理。目前已在深圳OH灣、合肥蘿崗中心公園、廣州九龍湖、珠海唐家港、文成天鼎湖等重點區域啟動營運點。每個場地都配備了EH216-S專用垂直起降機場、機庫、旅客服務區等設施。

In addition, many local governments are planning to build operation networks for future air mobility. For example, Shenzhen targets to set up a thousand of low-attitude takeoff and landing platforms, and Guangzhou plans to invest RMB10 billion into low-attitude infrastructure. This will include over a hundred regular-use vertiports and hundreds of community landing pads. Our EH216-S is ideally suited for future urban air transportation. It's compact, lightweight, can fly autonomously, easy to manage fleets, and cost-effective.

此外，許多地方政府正在規劃建設未來空中機動作戰網路。例如，深圳計劃興建1,000個低空起降平台，廣州計畫投資100億元用於低空基礎建設。這將包括一百多個常規使用的垂直起降機場和數百個社區停機坪。我們的 EH216-S 非常適合未來的城市空中交通。它結構緊湊、重量輕、可自主飛行、易於管理機隊且具有成本效益。

In May, we were actively involved in shaping China's first group standard for eVTOL vertiports. This will set the stage for future industry standards. Notably, all vertiports built in accordance with this standard will be able to accommodate EH216-S.

五月份，我們積極參與制定中國首個電動垂直起降機場團體標準。這將為未來的行業標準奠定基礎。值得注意的是，所有按照該標準建造的垂直起降機場都能夠容納 EH216-S。

In terms of operation standards and certification, as Mr. Hu mentioned, in July, the CAAC accepted the Air Operator Certificate, or OC, applications by two operators. One is EHang General Aviation, our subsidiary for UAM operations. The other is Heyi Aviation, our operation joint venture in Hefei. The CAAC has finished the reviewing of Heyi Aviation's application documents, and is about to conduct the on-site inspection soon. The first OC for pilotless passenger-carrying eVTOL is expected to receive within this year, allowing the operator to launch commercial operations with EH216-S. Afterwards, we will help more customers and partners in applying OC, with our accumulated experience and established safety standards. This will also help expanding our operation network.

在運作標準和合格審定方面，正如胡局長所提到的，今年7月，中國民航局受理了兩家航空公司的航空營運許可證（OC）申請。一個是億航通航，我們負責城市空中交通運作的子公司。另一家是我們在合肥的合資營運企業合一航空。民航局已完成對合一航空申請文件的審查，即將進行現場檢查。首架無人駕駛載客 eVTOL 的 OC 預計將於今年內收到，這將使營運商能夠使用 EH216-S 進行商業營運。後續我們將利用我們累積的經驗和建立的安全標準，幫助更多的客戶和合作夥伴應用OC。這也有助於擴大我們的營運網絡。

In July, we also formed a strategic partnership with China Southern General Aviation, a leading general aviation service provider under the China Southern Airlines Group. Together, we are planning to introduce a range of services, including eVTOL tourism, cross-island flights, and cargo transportation at Zhuhai Airport, Chimelong Ocean Kingdom, and the surrounding islands.

7月，我們也與中國南方航空集團旗下領先的通用航空服務供應商中國南方通用航空建立了戰略合作夥伴關係。我們計劃共同推出一系列服務，包括電動垂直起降旅遊、跨島飛行以及珠海機場、長隆海洋王國和周邊島嶼的貨運。

Moreover, we are thrilled to see several local governments, including those in Shenzhen, Guangzhou, Hefei, and Zhuhai, are offering direct subsidies for eVTOL commercial routes. These subsidies range from RMB100 to RMB300 per passenger per flight, providing robust support for eVTOL service operators.

此外，我們很高興看到深圳、廣州、合肥、珠海等多個地方政府正在為eVTOL商業航線提供直接補貼。這些補貼金額為每位乘客每架飛機100元至300元人民幣，為eVTOL服務業者提供了強而有力的支援。

In the international market, we continued to expand into the Middle East market in the second quarter. In April, we reached a strategic cooperation with the Abu Dhabi Investment Office and a Multi-Level Group. They will support our development in the UAE and the Middle East region. In May and June, our EH216-S completed debut flights in UAE and Saudi Arabia. Since then, our eVTOL footprint has expanded to 16 countries worldwide. In the third quarter, we will continue to expand our business in overseas markets, such as Africa, the Middle East, Central America, and Europe.

在國際市場，我們第二季持續拓展中東市場。4月，與阿布達比投資辦公室、Multi-Level集團達成策略合作。他們將支持我們在阿聯酋和中東地區的發展。五月和六月，我們的 EH216-S 在阿聯酋和沙烏地阿拉伯完成首航。自那時起，我們的 eVTOL 業務範圍已擴展到全球 16 個國家。第三季度，我們將持續拓展海外市場業務，例如非洲、中東、中美洲和歐洲。

Looking ahead, we will focus on executing our business strategy on sales and operations and delivering results consistently. Our goal is to play a key role in commercializing China's low-attitude economy and the global UAM industry, with safety as our top priority.

展望未來，我們將專注於執行銷售和營運業務策略並持續取得成果。我們的目標是在中國低空經濟和全球城市空中交通產業的商業化中發揮關鍵作用，並將安全放在首位。

Next, I will turn the call over to our CFO, Conor Yang, on financial performance. Thanks.

接下來，我將把電話交給我們的財務長 Conor Yang，討論財務表現。謝謝。

Thank you, Mr. Wang. Hello, everyone. This is Conor. Before I dive into details, please note that all numbers presented are in RMB and are for the second quarter of 2024, unless stated otherwise. Detailed analyses are available in our earnings press release on our IR website. I will now highlight some key points.

謝謝您，王先生。大家好。這是康納。在我深入介紹細節之前，請注意，除非另有說明，所有數字均以人民幣為單位，且為 2024 年第二季的數字。詳細分析請參閱我們 IR 網站上的收益新聞稿。我現在將強調一些要點。

I am pleased to report that our continued diligent execution has led to another quarter of exceptional financial results in Q2 2024. We exceeded our revenue guidance by over 13%, achieved adjusted net income and have generated positive operating cash flow for three consecutive quarters. Notably, our OC application has been formally accepted by CAAC, marking a significant step closer to commercial operations and accelerated growth.

我很高興地報告，我們持續勤勉的執行使 2024 年第二季再次取得了卓越的財務業績。我們的收入超出預期 13% 以上，實現了調整後的淨收入，並連續三個季度產生了正的營運現金流。值得一提的是，我們的營運中心申請已獲得中國民航局正式受理，這標誌著我們向商業營運和加速成長邁出了重要一步。

Now, let's delve into the details of our second quarter results. Total revenue in Q2 were RMB102 million, representing a significant increase of 919.6% year-over-year and a 65.3% increase from the prior quarter. The increases were primarily driven by higher sales volume of EH216 series products. We delivered 49 units of EH216 series products in Q2, a significant growth from 5 units a year earlier and 26 units in Q1 2024.

現在，讓我們深入了解第二季業績的細節。第二季總營收為人民幣1.02億元，年增919.6%，季增65.3%。成長主要得益於 EH216 系列產品銷售的增加。我們在第二季交付了 49 台 EH216 系列產品，較去年同期的 5 台和 2024 年第一季的 26 台有顯著成長。

Growth margin remains consistently high at 62.4% in Q2, up 2.2 percentage points from 60.2% in Q2 2023, and a 0.5 percentage point increase from 61.9% in Q1 2024. The increases were mainly due to changes in revenue mix. Our high gross margin continues to underscore our competitive edge in the eVTOL sector.

第二季成長率仍維持在高位，為 62.4%，較 2023 年第二季的 60.2% 上升 2.2 個百分點，較 2024 年第一季的 61.9% 上升 0.5 個百分點。成長主要是由於收入結構的變化。我們的高毛利率持續凸顯了我們在 eVTOL 領域的競爭優勢。

In Q2, our adjusted operating expenses, which are operating expenses excluding share-based compensation expenses, were RMB70.6 million, up 21.6% from RMB58 million in Q2 2023, and up 29.6% from RMB54.5 million in the prior quarter. The increases were mainly due to higher sales-related compensation, expansion of sales channels and increased expenditures on different models of eVTOL aircraft.

第二季度，我們的調整後營業費用（即不包括股權激勵費用的營業費用）為人民幣 7,060 萬元，較 2023 年第二季度的人民幣 5,800 萬元增長 21.6%，較上一季的人民幣 5,450 萬元增長 29.6%。成長的主要原因是銷售相關薪酬增加、銷售管道擴大以及不同型號 eVTOL 飛機支出增加。

Q2 adjusted operating loss was RMB4.7 million, a notable 90.9% improvement from RMB51.3 million in Q2 2023, and a 62.9% improvement from RMB12.6 million in Q1 2024.

第二季調整後營業虧損為人民幣 470 萬元，較 2023 年第二季的 5,130 萬元大幅改善 90.9%，較 2024 年第一季的 1,260 萬元改善 62.9%。

This quarter, we are proud to have achieved adjusted net income earlier than anticipated. Adjusted net income in Q2 was RMB1.2 million, compared to adjusted net loss of RMB51.8 million in Q2 2023, and adjusted net loss of RMB10.1 million in Q1 2024.

本季度，我們很榮幸能夠提前實現調整後淨收入。第二季調整後淨收入為人民幣 120 萬元，而 2023 年第二季調整後淨虧損為人民幣 5,180 萬元，2024 年第一季調整後淨虧損為 1,010 萬元人民幣。

Thanks to our prudent cash management and improved credit controls, we have achieved positive cash flow from operations for the third consecutive quarter, adding strength to our balance sheet. At the end of Q2, our cash, cash equivalents, short-term deposits, restricted short-term deposits and short-term investments balances were RMB988.2 million. Additionally, we have raised more than USD76 million from at-the-market offering as of today. With the strengthened liquidity position and our confidence in future growing operating cash flow, we will not continue selling ADSs under the at-the-market offering in 2024. The process already raised will fuel the next phase of our development and growth strategy aforementioned by Mr. Hu, including R&D for next-generation eVTOL technologies and products, team and production expansion, new headquarters in Guangzhou, upcoming commercial operations and other business purposes.

由於我們審慎的現金管理和改進的信貸控制，我們連續第三個季度實現了正的營運現金流，增強了我們的資產負債表。截至第二季末，我們的現金、現金等價物、短期存款、限制性短期存款及短期投資餘額為 9.882 億元。此外，截至今天，我們已透過市場發行籌集了超過 7,600 萬美元。隨著流動性狀況的增強以及我們對未來經營現金流成長的信心，我們將不會在 2024 年繼續以市場發行的方式出售 ADS。已經提出的流程將推動胡先生提到的下一階段的發展和成長策略，包括下一代 eVTOL 技術和產品的研發、團隊和生產擴張、廣州新總部、即將進行的商業營運和其他業務目的。

With the EH216-S having secured three certificates and our OC application accepted by the CAAC, we are well-positioned to commence commercial operations, setting the stage for a new phase of growth. We expect total revenues for the third quarter of 2024 to be around RMB123 million, representing an increase of 329.8% year-over-year and 20.6% quarter-over-quarter. Having achieved positive operating cash flow for the third consecutive quarter and adjusted net income in Q2, we are confident that this upward trend will continue, and ultimately led to full-year positive cash flow in 2024 and foreseeable adjusted net income in 2025.

隨著 EH216-S 獲得三項證書以及我們的營運許可證申請得到中國民航局的接受，我們已準備好開始商業運營，為新的成長階段奠定基礎。我們預計2024年第三季總營收約為人民幣1.23億元，年增329.8%，季增20.6%。我們已經連續三個季度實現正經營現金流，並在第二季度實現調整後淨收入，我們相信這種上升趨勢將持續下去，並最終在 2024 年實現全年正現金流，並在 2025 年實現可預見的調整後淨收入。

That concludes our prepared remarks. Let's now open the call for questions. Operator, please go ahead.

我們的準備好的演講到此結束。現在讓我們開始提問。接線員，請繼續。

(Operator Instructions)

（操作員指示）

Laura Li, Deutsche Bank.

德意志銀行的 Laura Li。

Thank you for taking my question and congratulations on the strong quarter.

感謝您回答我的問題，並祝賀本季業績強勁。

My first question is, thinking about the timeline of commercial operation in overseas markets, when would you expect to start that? Is 2025 realistic?

我的第一個問題是，考慮到海外市場商業運營的時間表，您預計什麼時候開始？2025年現實嗎？

(interpreted)

（翻譯）

Here's the English translation.

這是英文翻譯。

We've been actively expanding our presence in international markets, but starting commercial operations in overseas countries depends on getting local regulatory approvals and certifications.

我們一直在積極擴大在國際市場的影響力，但在海外國家開展商業運營取決於獲得當地監管機構的批准和認證。

Right now, EHang is working with the CAAC in advancing bilateral airworthiness agreement for the Validation of Type Certificate, or VTC, of EH216-S with other countries' aviation authorities, such as UAE, Brazil, Indonesia, and Thailand, etc. The timeline depends on the local regulators’ schedule and progress. Throughout the process, EHang will actively cooperate and provide the required documents to push forward the process.

目前，億航智慧正與中國民航局合作，與阿聯酋、巴西、印尼、泰國等國家的民航局推進EH216-S型號合格證（VTC）的雙邊適航協議。具體時間取決於當地監管機構的安排和進度。在整個過程中，億航將積極配合並提供所需文件以推進進程。

Besides, we have already made a few deliveries in overseas markets, like the Middle East and Indonesia, and conducted demo flights there. This helped us not only to expand the market to educate the public, but also to enhance the communication with local authorities for their recognition of our aircraft and our aircraft safety features, paving the way for the VTC certification.

此外，我們已經在中東、印尼等海外市場進行了少量交付，並進行了試飛。這不僅幫助我們擴大市場、教育公眾，而且還加強了與當地政府的溝通，以獲得他們對我們的飛機和飛機安全特性的認可，為 VTC 認證鋪平了道路。

Okay, thank you so much. I appreciate the color. My second question is, I think we got really impressive gross margin of over 60%. Just trying to understand what percentage of our supply chain we actually share or overlap with the EV or the drone business.

好的，非常感謝。我很欣賞這個顏色。我的第二個問題是，我認為我們的毛利率確實非常高，超過 60%。只是想了解我們的供應鏈中有多少比例實際上與電動車或無人機業務共享或重疊。

Okay, most of our procurement are from China domestic with some electric components or chips imported from overseas. Battery design is different than the EV car, so we design our own battery as well as we design our own electric motor and we outsource to suppliers in China. In general, there are certain portions overlapping with EV cars, but mostly are different. For most part, we produce and we assembly in our own factory, in Yunfu factory so far.

好的，我們的採購大部分來自中國國內，有些電子元件或晶片從海外進口。電池設計與電動車不同，因此我們設計自己的電池和電動馬達，並將其外包給中國的供應商。整體來說，有一部分與電動車重疊，但大部分還是不同的。目前，我們大部分產品都在自己的工廠（即雲浮工廠）生產和組裝。

Thank you for the color. Congratulations again for the record delivery. Thank you.

謝謝你的顏色。再次恭喜您創下紀錄。謝謝。

Ting Song, Goldman Sachs.

宋婷，高盛。

My first question is about the progress of EHang obtaining the TC of VT-30. As we see that the VT-30 and EH216 are in different sizes and features. What are the key challenges of VT-30 when you developed it compared to the EH216?

我的第一個問題是關於億航獲得VT-30 TC的進展。我們看到 VT-30 和 EH216 的尺寸和特性不同。與 EH216 相比，VT-30 在開發過程中面臨的主要挑戰是什麼？

And my second question is on the R&D spending. What's your expectation of R&D spending in the next three years and what would be your key focus on the R&D investment? Will you spend more on the new model or the enhancement of the existing model? Thank you.

我的第二個問題是關於研發支出。您對未來三年的研發支出有何預期？研發投入的重點是什麼？您會在新車型上花費更多，還是在現有車型的增強上花費更多？謝謝。

(interpreted)

（翻譯）

This is the English translation.

這是英文翻譯。

Leveraging the VT-30 prototype, our R&D team is currently redesigning and upgrading our lift-and-cruise eVTOL model, for enhancing flight performance. And we will keep you updated on this. We will also submit the TC application for our lift-and-cruise model once it's released.

利用 VT-30 原型，我們的研發團隊目前正在重新設計和升級我們的升力巡航 eVTOL 模型，以提高飛行性能。我們將及時向大家通報最新情況。我們的升降巡航模型發布後，我們也將提交 TC 申請。

Since the EH216-S now has three required certificates, our main focus is on its sales and operations. The EH216-S is perfect for the air transportation within cities because it's compact and does not need a large takeoff and landing area. While the VT-30 series lift-and-cruise model is meant to complement our current product portfolio and use cases, and it is designed specifically for intercity air transportation. It's not a replacement for the EH216-S. That is suitable for the air taxi uses within the urban areas.

由於EH216-S現在擁有三張必需的證書，因此我們的主要關注點是其銷售和營運。EH216-S 非常適合城市內的空中運輸，因為它結構緊湊，不需要大量的起飛和降落區域。VT-30系列升力巡航機型旨在補充我們目前的產品組合和用例，它是專為城際航空運輸而設計的。它不能取代 EH216-S。適合城市範圍內的空中計程車使用。

Okay. This is Conor. I'll answer the second question regarding R&D.

好的。這是康納。我來回答第二個關於研發的問題。

For the second quarter, R&D expenses is about above 40% of our total operating expenses. Going forward, we expect that the R&D expenses will be around 45% to 50% of our total OpEx. We are committed to our R&D development. For example, if you compare the number of first quarter R&D expenses, actually, we have increased about 42% of R&D expenses from first quarter. Our future R&D efforts will focus on optimizing the EH216 performance improvement and developing the long-haul eVTOLs and other aircraft for both passenger carry as well as aerial logistics and that will include expenses on the R&D materials and our R&D team expansion, test flights, and airworthiness certification expenses.

第二季度，研發費用約占我們總營運費用的40％以上。展望未來，我們預計研發費用將占我們總營運支出的45％至50％左右。我們致力於研發發展。比如說，如果你比較一下第一季的研發費用，實際上，我們的研發費用比第一季增加了約42%。我們未來的研發工作將集中在優化 EH216 性能改進和開發長途 eVTOL 以及其他用於載客和空中物流的飛機，這將包括研發材料的費用和我們研發團隊的擴展、試飛和適航認證的費用。

I’d say that we believe our growth rate of revenues year-over-year will be a lot higher than overall OpEx. Even though we continue to increase our R&D expenses, R&D expenses as a percentage of revenue will continue to drop in the coming years.

我想說，我們相信我們的收入年增率將遠高於整體營運支出。儘管我們持續增加研發費用，但未來幾年研發費用佔收入的百分比將持續下降。

Cindy Huang, Morgan Stanley.

摩根士丹利的 Cindy Huang。

Thanks for taking my question and congratulations on remarkable 2Q results.

感謝您回答我的問題，並祝賀您第二季度取得了顯著的業績。

My first question is regarding your order backlog. I see EHang has made significant progress in securing new orders. Could you give us a quick update on how many purchase orders we have on hand and when they will be delivered? Also, could we have a rough idea on geographic mix in terms of the older backlogs? That's my first question.

我的第一個問題是關於您的訂單積壓。我看到億航在獲得新訂單方面取得了重大進展。您能否簡要介紹一下我們手頭上有多少採購訂單以及何時可以交付？此外，我們能否根據舊積壓訂單對地理分佈有一個大致的了解？這是我的第一個問題。

(interpreted)

（翻譯）

Currently, our orders and pre-orders has over 1,100 units in the China market. We plan to deliver these by batches over the next 1-3 years, per our customers' requests and their business development, and the pace of their placing orders. We are getting more and more new customers and orders, so we expect deliveries to keep growing. In the next phase, our focus will be on expanding production facilities, accelerating the deliveries of our existing order pipeline and new orders. For this year, we will also help our customers to apply OC, setting up demonstration projects in pioneer cities to exemplify eVTOL operations. In the future, we aim to replicate these operational sites and share our experiences in more locations across the country.

目前，我們在中國市場的訂單和預購量已超過1100台。我們計劃在未來1-3年內根據客戶的要求和業務發展以及下訂單的速度分批交付這些產品。我們正在獲得越來越多的新客戶和訂單，因此我們預計交付量將繼續增長。下一階段，我們的重點將放在擴大生產設施，加速現有訂單和新訂單的交付。今年，我們也將協助客戶應用OC，在先鋒城市建立示範項目，以示範eVTOL營運。未來，我們的目標是複製這些營運站點並在全國更多地方分享我們的經驗。

To add on your question about distribution on the geographic mix, the orders, if you recall that fourth quarter last year as well as the first quarter this year are obviously overseas order revenue contributes around 20% to 25% of our total revenue. But since the national government has been promoting low-altitude economy, we're seeing a very rapid growth of pre-orders in China. So we're expecting that in terms of geographic mix that will be 90% from China for this year and next. The percentage of the overseas revenue will decrease from last year even though the international demand is still quite strong.

關於地理分佈的問題，如果您還記得的話，去年第四季和今年第一季的訂單顯然都是海外訂單收入，占我們總收入的 20% 到 25% 左右。但自從國家政府大力推動低空經濟以來，我們看到中國的預訂量成長非常迅速。因此，就地理分佈而言，我們預計今年和明年的 90% 將來自中國。儘管國際需求仍然強勁，但海外收入的比例將比去年有所下降。

Thank you. That's pretty comprehensive. My second question is regarding gross margin. How should we think about the gross margin over time, especially after we take off on commercial operations?

謝謝。這非常全面。我的第二個問題是關於毛利率。我們應該如何考慮一段時間內的毛利率，特別是在我們開始商業營運之後？

Gross margin, right now, we are the only company that can provide a product for commercialization. Therefore, we have the pricing power. Even though as we scale up, we will have leverage in terms of procurement. On the other side, we continue to improve certain features of our EH216. So net-net, after we get the TC, we will still maintained 60% plus gross margin in the near future. In terms of the overall net margin, we have achieved adjusted net income in second quarter and as we have seen very strong revenue growth, with the revenue grows rapidly, we are expecting our adjusted net income margin will continue to improve in the many years to come.

毛利率，目前我們是唯一一家能夠提供商業化產品的公司。因此，我們有定價權。即使我們擴大規模，我們也將在採購方面擁有優勢。另一方面，我們持續改進EH216的某些功能。因此，總體而言，在我們獲得 TC 後，我們在不久的將來仍將保持 60% 以上的毛利率。就整體淨利潤率而言，我們在第二季度實現了調整後的淨收入，並且由於我們看到了非常強勁的收入增長，隨著收入的快速增長，我們預計未來許多年我們的調整後淨收入利潤率將繼續提高。

Yu Chen, Haitong Securities.

陳宇，海通證券。

Congratulations for the company’s business progress. Thank you for taking my question. I have two questions.

祝賀公司業務取得進展。感謝您回答我的問題。我有兩個問題。

The first one is, could the management provide some insight into the Company's plans for EH216's operations, including the planning sites, commercial routes and pricing strategies for each flight, once starting a commercial operation?

第一個問題，請問管理階層能否透露一下公司對EH216航班開始商業運作後的規劃，包括規劃站點、商業航線以及每個航班的定價策略等？

My second question is, we noticed that the Company is actively promoting the establishment of UAM operation sites and personnel training across various places. What is your current operation cooperation model with local governments or customers?

第二個問題，我們注意到公司正在積極推動各地城市空中交通運營站點的建設和人員培訓。目前你們和地方政府或客戶的營運合作模式是怎麼樣的？

(Spoken in Foreign Language)

（以外語講）

(interpreted)

（翻譯）

For your first question, besides EHang General Aviation and Hefei Heyi Aviation, EHang’s partners in Guangzhou, Shenzhen, Taiyuan, and Wuxi, among other cities are also actively preparing their OC applications.

關於第一個問題，除了億航通航和合肥合一航空，億航在廣州、深圳、太原、無錫等城市的合作夥伴也積極準備OC申請。

Once the local operators have obtained the OC, they will first start operations at our new headquarters in Guangzhou, Hefei Luogang Central Park, and more sites in Shenzhen, Wuxi, Taiyuan and Wencheng, starting from the aerial sightseeing use cases. Throughout the process, we will accumulate operational experience and continuously refining our operational manual, which will serve as a reference for new operators to mitigate their operational risks and uncertainties.

一旦本地業者獲得營運許可證，他們將首先在我們位於廣州的新總部、合肥蘿崗中央公園以及深圳、無錫、太原和文成的更多站點開始運營，從空中觀光用例開始。在此過程中，我們將累積營運經驗，不斷完善營運手冊，為新營運商降低營運風險和不確定性提供參考。

For the question on the pricing, aerial sightseeing is currently our targeted use case. Compared to the helicopters, our price can be half of them or even lower. It's very competitive because the EH216-S acquisition cost and maintenance cost is much lower than helicopter, and we don't have pilot cost. Moreover, local governments are offering subsidies for eVTOL route operations. For example, in Shenzhen and Hefei, they plan to offer subsidies for eVTOL operators for aerial sightseeing and air transportation within and between cities. The subsidies range from RMB100 to RMB300 per person for each flight.

對於定價問題，空中觀光目前是我們的目標用例。與直升機相比，我們的價格可以是直升機的一半甚至更低。它非常有競爭力，因為 EH216-S 的購買成本和維護成本比直升機低得多，而且我們沒有飛行員成本。此外，地方政府也為 eVTOL 航線營運提供補貼。例如，深圳和合肥計畫為eVTOL業者在城市內和城市間進行空中觀光和空中運輸提供補貼。補貼金額為每人每次航班100元至300元人民幣不等。

For your second question, EHang General Aviation is our wholly owned subsidiary. It serves as an operation platform company to provide operational services to our customers, setting up demo projects and models.

關於你的第二個問題，億航通航是我們的全資子公司。它作為一家營運平台公司，為客戶提供營運服務，建立演示項目和模型。

We have established joint ventures with local governments or partners through EHang General Aviation, to provide eVTOL operation services, such as Heyi Aviation in Hefei and Pengcheng Wings established with our customer Boling Group in Shenzhen.

我們透過億航與地方政府或合作夥伴成立合資公司，提供eVTOL營運服務，如合肥的合一航空、與客戶深圳博凌集團成立的鵬程之翼等。

So, our cooperation model works like this: EHang provides the necessary support, including after-sales services, operational guidance, technical specs, and personnel training, while the government and customers are responsible for planning and building the infrastructure. The joint venture will form an operational team and system to obtain the OC for commercial operations. By working together, we can ensure the safe operations and create a commercial model that can be scaled up, replicated and sustained.

所以我們的合作模式是這樣的：億航提供必要的支持，包括售後服務、營運指導、技術規範、人員培訓等；政府和客戶負責規劃和建造基礎設施。合資公司將組成營運團隊和體系，取得商業營運的經營許可。透過共同努力，我們可以確保安全運營，並創建可擴大、可複製和可持續的商業模式。

Gareth Zhao, TF Securities.

趙建軍，TF證券

Okay, so congratulations on the Company's outstanding performance this quarter. I have two questions. The first one is, do you expect to maintain the quarterly growth trend? Looking forward, how do you view the Company's revenue growth trajectory?

好的，恭喜公司本季的出色表現。我有兩個問題。第一個問題是，您預期季度成長趨勢會持續下去嗎？展望未來，您如何看待公司的營收成長軌跡？

Thank you for your question. This is Conor. We have pre-orders over 1,000 units in China, and our production has been steadily ramping up since obtaining the PC. So, we expect to maintain revenue growth in the third quarter, and our guidance for the third quarter is RMB123 million. That's more than 300% increase year-over-year and a more than 20% growth quarter-over-quarter. We are confident that our revenue will achieve triple-digit growth year-over-year in the upcoming quarters.

感謝您的提問。這是康納。我們在中國市場的預購量已超過1000台，自獲得這款PC以來，我們的產量一直在穩步提升。因此，我們預期第三季的營收將保持成長，我們對第三季的預期為人民幣1.23億元。與去年同期相比，成長了 300% 以上，與上一季相比，成長了 20% 以上。我們有信心，未來幾季我們的營收將實現同比三位數的成長。

For the aerial sightseeing market in China market, there are over 10,000 units of eVTOL in demand in China, and when it applies to transportation purpose in various cities in China that demand will be even larger together with the international demand. So we believe that we should achieve a very high growth rate for the next three to five years.

對於中國空中觀光市場而言，中國對eVTOL的需求量超過10,000台，當其應用於中國各城市的交通運輸時，加上國際需求，其需求量將會更大。因此我們相信，未來三到五年我們應該會達到非常高的成長率。

Okay. Thank you. That's very clear. My second question lies in overseas market. We have noticed that you have been expanding the Middle East market recently. What's your competition advantage in market like Middle East? Do these countries tend to favor eVTOL model that can fly longer distance?

好的。謝謝。這非常清楚。我的第二個問題是關於海外市場的。我們注意到你們最近正在拓展中東市場。你們在中東這樣的市場競爭優勢是什麼？這些國家是否傾向於飛行距離更長的eVTOL模型？

(interpreted)

（翻譯）

Here is the translation of the answers to your question.

以下是對您的問題的回答的翻譯。

EHang is the first eVTOL company to conduct test flights in the Middle East, which our first pilotless eVTOL flight in Dubai was back in 2017. In terms of airworthiness certification, we also have an advantage over our peers. The UAE's General Civil Aviation Authority or GCAA is moving forward a framework agreement with the CAAC, for mutual recognition of airworthiness certification. We will be conducting some test flights for the GCAA within this year. And in May, we conducted the first passenger-carrying flight in Abu Dhabi, marking the first of its kind in the UAE with GCAA's approval. It's a very significant milestone that lays the foundation for our future VTC.

億航是第一家在中東進行試飛的 eVTOL 公司，我們的首次無人駕駛 eVTOL 飛行是在 2017 年在杜拜進行的。在適航認證方面，我們也比同業更有優勢。阿聯酋民航通用局（GCAA）正在與中國民航局推動一項框架協議，以實現適航認證的相互認可。我們將在今年為 GCAA 進行一些試飛。今年5月，我們在阿布達比進行了首次載客飛行，這是阿聯酋經GCAA批准的首個載客飛行。這是一個非常重要的里程碑，為我們未來的 VTC 奠定了基礎。

Abu Dhabi are planning UAM infrastructure now, including the vertiports and the eVTOL terminals. We are very confident with the support of our local customers and partners in UAE and Saudi Arabia. We can be the first to commercialize eVTOL operations in the region. We believe that the flight range is not a key issue for eVTOLs. What really matters is to meet the needs of the passengers and fit the specific use cases. We've been seeing growing interest and demand for our EH216-S in the Middle East market, particularly for urban air transportation. We will introduce new type of aircraft to serve more and more diversified needs.

阿布達比目前正在規劃 UAM 基礎設施，包括垂直起降機場和 eVTOL 終端。我們對阿聯酋和沙烏地阿拉伯當地客戶和合作夥伴的支持非常有信心。我們可以成為該地區第一個實現 eVTOL 營運商業化的公司。我們認為飛行距離對 eVTOL 來說並不是一個關鍵問題。真正重要的是滿足乘客的需求並適應特定的用例。我們看到中東市場對我們的 EH216-S 的興趣和需求日益增長，尤其是在城市航空運輸領域。我們將推出新型飛機來滿足越來越多樣化的需求。

Rongyan Zhou, CITIC Securities.

週榮彥，中信證券。

First, congratulations on the Company's strong performance and business progress this quarter. Here I have two questions.

首先，恭喜公司本季的強勁業績和業務進展。這裡我有兩個問題。

For the first, with the capacity expansion plans underway in Guangzhou, Hefei, and other locations, could management provide more insight into its capacity expansion plans and what can we expect in terms of capital expenditures over the next two years?

首先，鑑於廣州、合肥和其他地區的產能擴張計劃正在進行中，管理層能否提供更多有關其產能擴張計劃的詳細信息，以及我們對未來兩年的資本支出有何預期？

Thank you. In our current Yunfu facilities, we plan to do more automation. As you know, we have signed a strategic agreement partnership with GAC, and they have a lot of experience in automation, in supply chain management. So, in Guangdong Province, we will improve the automation in Yunfu factory, the current one as well as we plan to build new facilities in Guangzhou together with GAC. On the other side, Hefei will build assembly plant. That's our plan. Overall in the next year, we should add some additional 1,000 annual production for next year.

謝謝。在我們目前的雲端浮工廠，我們計劃實現更多自動化。如您所知，我們已經與廣汽集團簽署了策略協議合作夥伴關係，他們在自動化和供應鏈管理方面擁有豐富的經驗。因此，在廣東省，我們將提高現有雲浮工廠的自動化程度，同時我們計劃與廣汽集團一起在廣州建造新工廠。另一邊，合肥將建造組裝廠。這就是我們的計劃。總體而言，明年我們的年產量應該會增加 1,000 輛左右。

In terms of CAPEX, we're re-innovating our new headquarters. We're building a lot of facilities. We're building our R&D labs. Also, we are building a test flight center and together with all these factory expansions. So we now expect the CAPEX for 2024 will be about USD15 million and CAPEX for 2025 will be around USD20 million.

在資本支出方面，我們正在重新改造我們的新總部。我們正在建造許多設施。我們正在建造我們的研發實驗室。此外，我們正在建造一個試飛中心，並進行所有這些工廠的擴建。因此，我們現在預計 2024 年的資本支出約為 1500 萬美元，2025 年的資本支出約為 2000 萬美元。

Thank you for your answers and my second question is, could management provide more information on recent ATM financing and the Company's financial plans for the future?

謝謝您的回答，我的第二個問題是，管理階層能否提供更多有關近期 ATM 融資和公司未來財務計畫的資訊？

Thank you. Since April, we have raised USD76.2 million through our ATM program, without disturbing the market. Our average price actually for all this USD76 million, the average price is USD16.5 per share. Right now, with the rapid revenue growth and consistent positive cash flow from operation, we decided not to continue selling ADSs under the ATM program for this year. And we're always looking for the best financing strategy and also optimize our capital structure to help the Company to build the strategy and also to drive our business growth. Thank you.

謝謝。自四月以來，我們透過 ATM 計劃籌集了 7,620 萬美元，並且沒有擾亂市場。我們實際上對這全部 7600 萬美元的平均價格是每股 16.5 美元。目前，由於收入快速成長且經營活動產生的現金流持續為正，我們決定今年不再繼續根據 ATM 計劃出售 ADS。我們一直在尋找最佳的融資策略，並優化我們的資本結構，以幫助公司製定策略並推動我們的業務成長。謝謝。

Okay. Thank you very much for your answer and congratulations again for the Company. Thank you.

好的。非常感謝您的回答，再次恭喜公司。謝謝。

Thank you all. Given the time is limited, let me turn the call back to Ms. Anne for closing remarks.

謝謝大家。由於時間有限，請允許我把電話轉回給安妮女士做結束語。

Thank you, Operator. Thank you all for participating on today's call. If you have any further questions, please contact our IR team by email or participate in the following investor events through the calendar information provided on our IR website. We appreciate your interest and look forward to our next earnings call. Thank you.

謝謝您，接線生。感謝大家參加今天的電話會議。如果您有任何其他問題，請透過電子郵件聯絡我們的 IR 團隊，或透過我們的 IR 網站上提供的日曆資訊參加以下投資者活動。感謝您的關注，並期待我們的下一次收益電話會議。謝謝。

That concludes our conference for today. Thank you for participating. You may now all disconnect. Have a nice day.

今天的會議到此結束。感謝您的參與。你們現在都可以斷開連結了。祝你今天過得愉快。

Portions of this transcript that are marked (interpreted) were spoken by an interpreter present on the live call. The interpreter was provided by the company sponsoring this event.

本記錄中標記（翻譯）的部分是由現場通話中的翻譯人員說的。翻譯由贊助此活動的公司提供。