Introduction

Time flows steadily, and the year 2025 has quietly etched its mark; Highly presses forward without pause, continuing to write a new chapter in its journey. This year, we have steered by our "dual-core business" strategy, navigated with innovation as our sail, anchored our direction through the unifying force of Party-building leadership, tackled challenges through courageous exploration in technological renewal, expanded our presence across the vast global markets, and walked the path of social responsibility with warmth and commitment. Every solid footprint holds the code to our growth; every breakthrough shines with the light of our endeavors. This annual report invites you to review Highly's journey in 2025.

Chapter One: Strategic Synergy · Expanding Markets Together

Milestone 1: Highly Expands Its South China Presence, Joining Forces with Dongfeng Nissan for Shared Growth

In January, the Highly Marelli South China Office was inaugurated, establishing an integrated platform encompassing "sales, R&D, production, and customer response." The office showcased cutting-edge technological achievements and reached a consensus on deeper cooperation with Dongfeng Nissan, committing to support the client's growth through high-quality products and efficient services.

Milestone 2: Xiaomi Visit Explores Cooperation, Smart Manufacturing Gains Recognition.

In April, Xiaomi Group President Lu Weibing led a delegation to visit Nanchang Highly, where he highly recognized the company's capabilities in mechatronics R&D, large-scale flexible customization, and refined process control. Both parties conducted in-depth exchanges on global air conditioning market trends, laying the foundation for long-term cooperation.

Milestone 3: Partnering with BYD to Forge New Ground – Highly Marelli Maps Out Cooperation Blueprint.

 In May, Shanghai Electric, together with Highly Marelli, held in-depth talks with BYD's senior management. BYD clearly articulated its cooperation needs in automotive parts supply and overseas collaboration, establishing a foundation for deeper engagement between Highly Marelli and BYD. Highly Marelli will focus on cost-competitive product supply and overseas market synergy to drive practical cooperation with BYD and jointly expand new space for industrial development.

Milestone 4: New Nanchang Base Breaks Ground, Smart Manufacturing Embarks on a New Journey.

 In August, the Nanchang Highly Heating & Cooling Technology Project broke ground, aiming to drive digital compressor development through technological innovation, build a global smart manufacturing talent hub, and establish a world-class digitalized factory, empowering core business upgrades with new-quality productive forces.

Milestone 5: Deepening Strategic Cooperation to Jointly Expand Global Markets.

 In September, a team led by Jan Brockmann, CEO of Bosch Comfort Technology Group, engaged in in-depth exchanges with Highly and acknowledged Highly's achievements in lean manufacturing, technological innovation, and operational management. Going forward, both parties will leverage their respective core strengths in smart manufacturing and global market channels, clarify cooperation intentions, and explore new models of global market collaboration, injecting new momentum into the high-quality development of the global HVAC and home comfort industry.

Milestone 6: Joining Hands with Haier and Hisense to Expand Ecosystem Synergy.

 In October, Shanghai Electric held deepened talks with Haier and Hisense. As a core partner, Highly leveraged its own strengths to continue driving efforts in core technology collaboration, global market expansion, and zero-carbon ecosystem development, contributing to cross-industry integrated solutions.

Milestone 7: Securing Major Ford Project, Breaking New Ground in the North American Market.

 In October, Highly Marelli North America successfully secured the Ford S750 Mustang project, marking its first partnership with a top-tier North American OEM. Led by the regional R&D team and scheduled for localized production, the project establishes a core strategic foothold for deepening penetration in the North American market.

Chapter Two: Technological Breakthroughs · Leading Innovation

Milestone 8: Major New Product Launches at Auto Show, Thermal Management Technology Sets the Trend. 

In April, Highly unveiled three breakthrough products at the 2025 Shanghai International Auto Show: the R290 refrigerant integrated module, achieving a 10% reduction in both volume and weight, and two low-temperature heat pump compressors that break the -10°C heating barrier and can operate stably in extreme cold environments as low as -40°C, solidifying its global technology leadership position.

Milestone 9: Industry-Academia-Research Collaborative Efforts, Charting a New Chapter in New Energy Vehicle Thermal Management.

 In November, Highly Marelli held joint seminars with Shanghai Jiao Tong University, focusing on the intelligent and global development of new energy vehicle thermal management. Both parties clarified directions in modular design and technology iteration, leveraging the combined strengths of industry, academia, and research to capture the industry's technological high ground.

Milestone 10: Showcasing Achievements at Industry Events, Innovative Technologies Draw Attention.

 In December, Highly Appliance appeared at the Annual Academic Conference of the Chinese Association of Refrigeration and the Annual Conference of China Household Electrical Appliance Technology, systematically presenting its cutting-edge achievements in compressor technology, engaging deeply in industry exchanges, and demonstrating its role as a technology leader.

Chapter Three: Party-Building Leadership · Cultural Cohesion

Milestone 11: Bilingual Magazine Relaunched, Adding New Wings to International Integration.

In January, Highly launched its bilingual English-Japanese overseas e-magazine HIGHLY NEWSLINE, delivering group updates, articulating strategic plans, and disseminating corporate culture. The publication has become an important platform for global information sharing and cross-cultural integration, supporting Highly's international development.

Milestone 12: Party-Building Collaboration Builds Bridges, Industry-Finance Synergy Drives Development. 

In May, exploring a new "Party-Building + Finance + Industry" model, the Party Committee of Highly Group and the Party Committee of Jianyuan Trust signed a Party-building collaboration agreement. Both parties fully leveraged their respective industrial strengths and financial resources, focusing on key areas such as industrial chain optimization and technological innovation, to create a new model of industry-finance integration and inject new momentum into high-quality development.

Milestone 13: Highly Summer Celebration Showcases Global Spirit, Uniting as One for a New Chapter.

 In August, the "Together Up" Highly Summer Celebration was held, featuring a diverse program from global subsidiaries and highlighting the appeal of cross-cultural integration. The event included a charity donation ceremony, a tribute to long-serving employees, and the launch of the Highly Global Passport, showcasing the achievements of global expansion while uniting the entire workforce in shared purpose and strength.

Milestone 14: University-Enterprise Party-Building Collaboration Pooling Strengths, Industry-Education Integration Cultivating Talent. 

In December, Nanchang Highly and Jiangxi Technical College of Manufacturing held a university-enterprise Party organization collaboration signing ceremony and the unveiling of an "on-campus factory." Both parties signed the collaboration agreement and inaugurated the "on-campus factory," marking the entry of their cooperation into a deeply integrated phase of Party-building-led talent development and industrial synergy. The partnership will deepen the "on-campus factory + in-factory campus" model and jointly establish the provincial-level Nanchang Highly Smart Manufacturing On-Site Engineer Academy.

Chapter Five: Honors and Accolades · Affirmation of Strength

Milestone 15: Quality Management Gains Recognition, North American Plant Tops Quality Rankings.

In August, Highly Marelli's Shelbyville, U.S. plant secured the top spot in Nissan NNA & NMEX regional supplier L1 quality rankings through data-driven lean management, achieving a scrap rate of 0.04%, demonstrating world-class quality management capabilities.

Milestone 16: Named National Excellent-Level Smart Factory, Nanchang Highly Sets New Benchmark in Smart Manufacturing.

 In September, Nanchang Highly's large-scale personalized customized air conditioning compressor smart factory was included in the national-level list. This represents another national recognition in the field of digital transformation, following its previous designations as an industrial internet pilot demonstration and a national smart manufacturing demonstration factory, setting an industry benchmark.

Milestone 17: Securing Dual Honors, Highly Marelli Receives Prestigious Recognition. 

In December, Highly Marelli secured two prestigious honors: the Green Innovation International Award at the Belt and Road Intellectual Property Forum, and a spot in the Gasgoo Auto Parts Supply Chain Top 100. These recognitions, focusing respectively on green technology deployment and automotive thermal management technical strength, are a testament to the company's capabilities and inject strong momentum into its continued industry leadership.

Chapter Six: Social Responsibility · Practicing ESG Principles

Milestone 18: Thailand Plant Retains Green Certification, Demonstrating Significant Achievements in Sustainable Development.

 In July, Highly Marelli's Thailand plant received Thailand's "Green Industry Level 3" certification for the fourth consecutive year. Through initiatives such as tree planting, plastic recycling, and energy-saving advocacy, the plant has deepened its environmental practices and continues to progress toward higher-level green certifications.

Milestone 19: Highly's Compassion Reaches Yunnan Honghe, Public Welfare Support for "Elderly and Young."

 In October, Highly launched a three-year care program, donating RMB 300,000 in scholarships and over RMB 200,000 in supplies to support disadvantaged students and elderly residents in Honghe Prefecture. Continuing a 30-year legacy of public welfare, Highly's cumulative donations have exceeded RMB 10 million, demonstrating corporate responsibility through action.

Milestone 20: Impressive ESG Performance Ranks Among Yangtze River Delta Pioneers, Joins UN Global Compact in Commitment to Responsibility.

 In October, Highly ranked 8th in the "China ESG Listed Companies Yangtze River Delta Pioneer 100" and officially joined the United Nations Global Compact, showcasing the company's outstanding practices and firm commitment in the environmental, social, and governance domains.

Epilogue

Years do not stand still, and hard work pays off; our original aspiration remains steadfast, and the future is promising. Every achievement in 2025 is the fruit of concerted efforts and perseverance by all Highly people, and it is also the confidence to scale new heights on the new journey. In the new year, Highly will continue to be guided by party building, with technology as the core, cooperation as the driving force for development, and responsibility as the manifestation of commitment. We will continue to strive for excellence in the dual main business tracks of heating and cooling systems and automotive components, and move forward bravely in the globalization layout. May we work together, with a more vigorous attitude and more pragmatic actions, to write a new chapter of high-quality development, and make the banner of Highly shine even brighter on the world stage!