Weichai Power Industry: Large-bore Cylinder Business Enters Scale Expansion Phase, Performance Continues to Deliver

Translated from: China Securities Journal · China Securities Network

China Securities Journal China Securities Network News (Reporter Zhang Pengfei) Leveraging the core advantages of high value-added, high prosperity, and high barriers of large-bore engines, Weichai Power is ushering in a new round of value reconstruction. According to the company’s annual report, the large-bore business has entered a period of scaled release, with continued improvement in performance realization. In 2025, the annual sales of M series large-bore products will exceed 10,000 units for the first time, a year-on-year increase of 32%, achieving a revenue growth of 65% year-on-year; among them, the sales of data center products reached approximately 1,400 units, a significant year-on-year increase of 259%. The large-bore business is becoming a key force driving the upward shift in valuation.

High value-added drives profit structure upgrade

In 2025, Weichai Power’s large-bore business shows a quality growth characteristic where revenue growth significantly outpaces sales growth, intuitively reflecting the continuous upgrade of product structure towards high-end and high-power directions, with average unit prices steadily increasing and the proportion of high value-added products continuously expanding, fundamentally optimizing profit quality.

The annual report disclosed that in 2025, Weichai Power’s M series large-bore engine sales will be approximately 11,000 units, achieving revenue of 5.81 billion yuan. Based on data calculations, the unit price of the M series large-bore engine exceeds 500,000 yuan, achieving about a five-fold value leap compared to the average price of traditional heavy-duty truck engines, which is around 100,000 yuan. Moreover, the company’s products are continuously upgraded and iterated; in 2025, the company will launch the world’s first 5-megawatt high-speed diesel generator product, with key indicators such as power output reaching world-class levels. The market estimates that this product is expected to further open up high-end premium space.

From a profit logic perspective, large-bore engines possess significant gross profit advantages. CITIC Securities research points out that the unit weight value of high-displacement engines exhibits nonlinear growth, with gross profit margins significantly higher than those of smaller displacement models. The continuous expansion of high-gross-profit business scale will optimize the company’s profit structure, improve overall profit levels, and effectively reduce valuation discounts caused by cyclical fluctuations.

Data center market dividends open up growth space

The global explosion of AI computing power and accelerated construction of data centers have opened up broad growth space for large-bore engines, with industry prosperity possessing medium to long-term certainty. Against this backdrop, Weichai Power, leveraging its first-mover advantage, achieves “dual growth in volume and price,” activating growth attributes, and precisely positioning its layout with technical and product advantages, accelerating the release of business scale and breaking the long-standing monopoly of foreign brands in this field.

Goldman Sachs believes that Weichai Power’s existing diesel generator engines are demonstrating stronger-than-expected momentum, benefiting from the global AIDC investment boom and the tight supply chain of generating equipment. It is expected that Weichai Power’s value share in the global data center generator engine market will continue to rise.

Diverse application layout expands growth boundaries

Beyond data centers, Weichai Power’s large-bore engine products are rapidly entering fields such as large engineering machinery and ships, forming a “multi-point support” growth pattern. Multi-scenario layouts effectively disperse the risk of single-industry fluctuations, enhancing growth resilience. The company continues to promote the process development, assembly, and capacity transformation of the M series engines, accelerating capacity ramp-up and delivery capabilities, providing solid guarantees for rapid market share expansion.

In the long term, Weichai Power’s high value-added large-bore business fully benefits from the continuous expansion of AI data center construction, coupled with the constantly widening boundaries of diverse application scenarios. The underlying logic of high growth for the business has taken shape. The high value-added properties continue to optimize the company’s profit structure, while the data center industry’s dividends further strengthen the offensive momentum for performance growth, and the expansion layout across multiple fields solidifies the certainty of long-term development. The resonance of multiple growth logics helps the company steadily enter a new cycle of high-quality growth.

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