The maker of braking systems for Chery's electric vehicles is looking to accelerate a move into advanced chassis technology, with robotics as a potential spinoff

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Key Takeaways:

• Bethel has filed for a Hong Kong listing with plans to invest the money in developing integrated chassis systems for braking, steering and suspension
• Intelligent electronic control products have become the company's biggest revenue earner, but margins and cash flow have been tightening

Never mind batteries and laser sensors, competition in China's electric vehicle sector is now shifting towards state-of-the-art undercarriages, equipped with intelligent chassis systems.

In new-energy models, the frame of the car is transforming into a high-tech platform in which mechanical parts are replaced by electrical components controlled by software or AI. The feature has attracted limited investor attention so far but is coming to the fore as a new competitive battleground in the EV supply chain.

One of the Chinese companies aiming to ride the trend, Bethel Automotive Safety Systems Co. Ltd. (603596.SH), filed for a Hong Kong listing this month to help fund its ambitions, with CICC serving as sole sponsor.

Originally focused on brake components, the company is now looking to make bigger inroads into the market for intelligent chassis systems and electronic braking technologies, which has long been dominated by multinational brands such as Germany's Bosch, Continental (CON.DE) and ZF.

Bethel Chairman Yuan Yongmei worked on braking R&D at U.S. auto parts giant TRW, now a part of the ZF Group, before returning to China to start his own business. He founded Bethel in Wuhu, Anhui province, in 2004. The company initially supplied conventional braking products before gradually shifting into automotive electronics.

The new braking methods use motors, sensors and electric signals rather than cables and hydraulics to slow a car or lock its wheels. They include electronic parking brake systems (EPB), brake-by-wire systems and electro-mechanical braking (EMB) systems.

Bethel's products cover all three types, as well as steering-related systems.

According to third-party data cited in the filing, the firm ranked first among Chinese domestic suppliers in both the EPB and brake-by-wire markets in China in 2025, with market shares of 14.2% and 8.6%. Brake-by-wire products, using electronic braking controls, are widely viewed as key components for intelligent vehicles. Meanwhile, electro-mechanical brakes, combining sensors and motors, are regarded as a core feature of next-generation smart chassis systems.

As advanced driver assistance is adopted more widely, chassis systems are evolving beyond purely mechanical structures into control units that can make intelligent driving commands. Increased requirements for chassis control in new energy vehicles and intelligent models are also boosting demand for brake-by-wire systems, electronic steering and chassis domain controllers.

Bethel's turnover has risen accordingly. From 2023 to 2025, the company's revenue increased from nearly 7.2 billion yuan ($1.06 billion) to 11.71 billion yuan, a compound annual growth rate over two years of 27.6%, while annual profit rose from 911 million yuan to 1.32 billion yuan. Income from intelligent electronic control products climbed from 3.28 billion yuan to 5.83 billion yuan, lifting the revenue contribution from 45.5% to 49.7% and overtaking conventional braking products to become the company's biggest money-making segment.

Despite the growth, pressure persists across the automotive supply chain. Bethel's overall gross margin declined from 19.1% in 2023 to 17.6% in 2025, while gross margin for conventional braking products fell from 20.3% to 15.4. Net cash from operating activities also fell from nearly 1.06 billion yuan in 2024 to 867 million yuan in 2025. Accounts receivable, notes receivable and inventories increased during the same period, reflecting longer receivable cycles and rising inventory pressure as the company expanded.

Deep ties with Chery

Notably, Chery Automobile (9973.HK) and its affiliates have long been Bethel's largest customer group, while Chery also indirectly holds about 14.56% of Bethel's shares. Revenue from Chery and related businesses accounted for 45.1% of Bethel's revenue in 2024 before slipping to 39% last year. The recent growth has been driven in large part by the rapid expansion of Chery's new energy vehicle business and exports, limiting Bethel's pricing power.

The close corporate ties have also raised market concerns, after Chinese media reported that Bethel director and board secretary Chen Zhongxi had received verbal warnings and regulatory inquiry letters from the Shanghai Stock Exchange over disclosures of related-party transactions with the Chery ecosystem.

Bethel is also using acquisitions to expand further into the chassis business. The company plans to acquire a 50.97% stake in Yubei Steering for 1.12 billion yuan to help develop an intelligent chassis that integrates braking and steering. Chinese media reports suggest that once the steering business is fully integrated, Bethel's component value per vehicle could rise from less than 2,000 yuan to between 3,500 yuan and 5,000 yuan, potentially boosting earnings per vehicle.

The company has also started to develop embodied robotics, using its expertise in steering actuators, EMB systems and intelligent control mechanisms, according to the filing. Although the business remains at an early stage, investors have begun to see a crossover between automotive chassis technology and systems to direct humanoid robots.

Hong Kong has traditionally assigned more conservative valuations to auto parts makers than mainland Chinese markets, leaving Bethel at risk of discounting pressure after its debut. Suppliers listed in Hong Kong such as Minth Group (0425.HK), Nexteer Automotive (1316.HK) and Fuyao Glass (3606.HK) currently trade at around 14 to 16 times earnings, while Bethel trades in Shanghai at around 24 times earnings. Investors in Hong Kong also tend to place greater emphasis on cash flow, earnings quality and efficient use of capital rather than pure revenue growth.

Despite the benefits of being part of China's push for automotive intelligence and next-generation robotics, Bethel is still facing declining margins, customer concentration risks, weakening cash flow and big capital needs. Its fate in the Hong Kong market will hinge on whether the company can truly transform itself from a traditional supplier of braking parts into a provider of intelligent chassis technology.

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Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.