A.History and Development of the Company The Company China Yuchai International Limited is a Bermuda holding company established on April 29, 1993 to own a controlling interest in Yuchai. We currently own, through six of our wholly-owned subsidiaries, 76.4% of the outstanding shares of Yuchai. We operate as an exempted company limited by shares under The Companies Act 1981 of Bermuda. Our registered office is located at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda. On March 7, 2008, we registered a branch office of the Company in Singapore, located at 16 Raffles Quay #26-00, Hong Leong Building, Singapore 048581. Our principal operating office is located at 16 Raffles Quay #39-01A, Hong Leong Building, Singapore 048581. Our telephone number is (+65) 6220-8411. Our transfer agent and registrar in the United States is Computershare Inc., located at 111 Townsquare Place, Suite 1505, Jersey City, NJ 07310. The SEC maintains a website at www.sec.gov/ that contains reports, proxy and information statements and other information regarding registrants that make electronic filings with the SEC, including our Company. Our website address is www.cyilimited.com. The information contained on, or accessible through, our website is not incorporated by reference into this Annual Report. Until August 2002, we were controlled by Diesel Machinery, a company that was 53.0% owned by Hong Leong Asia, through its wholly-owned subsidiary, Hong Leong China. Hong Leong China owns HL Technology which held shares in us through Diesel Machinery. Diesel Machinery was also 47.0% owned by China Everbright Holdings Company Limited, or China Everbright Holdings, through its wholly-owned subsidiary, Coomber. Hong Leong Asia, a company listed on the Singapore Exchange, is part of the Hong Leong Investment group of companies, which was founded in 1941 by the Kwek family of Singapore and remains one of the largest privately-controlled business groups in Southeast Asia. In 2002, China Everbright Holdings and Coomber gave notice to Diesel Machinery and the other shareholders of Diesel Machinery to effect a liquidation of Diesel Machinery. As a result of the liquidation, Hong Leong Asia acquired the special share through HL Technology which entitles Hong Leong Asia to elect a majority of our directors and also to veto any resolution of our shareholders. China Everbright Holdings sold its shareholding in Coomber, which held shares of our common stock, in October 2002 to Goldman Industrial Limited, or Goldman, and China Everbright Holdings is no longer a shareholder of our Company. Goldman was a subsidiary of Zhong Lin Development Company Limited, or Zhong Lin, an investment vehicle of the city government of Yulin in Guangxi, China until September 29, 2006 when Zhong Lin sold its shareholding in Goldman to the GY Group. We provide certain management, financial planning, internal audit services, internal control testing, IFRS Accounting Standards training, business enhancement consulting and other services to Yuchai and we continue to have a team working full-time at Yuchai’s principal manufacturing facilities in Yulin city. In addition, the President, Chief Financial Officer, Senior Vice President of Operations and a manager proficient in Section 404 of Sarbanes-Oxley Act of 2002, or SOX, travel frequently for as much as up to two weeks at a time, to Yuchai to actively participate in Yuchai’s operations and decision-making process. Our main operating asset has historically been, and continues to be, our ownership interest in Yuchai, and our primary source of cash flow has historically been our share of the dividends, if any, paid by Yuchai and investment income thereon. However, on February 7, 2005, the Board of Directors of the Company announced its approval of the implementation of a business expansion and diversification plan by the Company. Following such announcement, we have looked for new business opportunities to seek to reduce our financial dependence on Yuchai: •In March 2005, we acquired a 15.0% interest in the capital of TCL through Venture Delta Limited (“Venture Delta” or “VDL”). In 2022, we fully disposed of our shareholding interest in TCL. •In February 2006, we acquired debt and equity securities in HLGE through two wholly-owned subsidiaries. Our shareholding in HLGE has changed through various transactions and as of December 31, 2025, through our wholly-owned subsidiary, Grace Star Services Limited (“Grace Star”), we had a 49.1% shareholding interest in HLGE, which has remained unchanged as of February 27, 2026. The HLGE Group is engaged in hospitality and property development activities conducted mainly in Malaysia. For more details on our investments in HLGE, see “Item 5. Operating and Financial Review and Prospects —Business Expansion and Diversification Plan.” Since January 1, 2025, there have been no public takeovers by third parties in respect of our shares, and we have not made any public takeovers in respect of other companies’ shares. 28 Table of Contents Yuchai Yuchai was founded in 1951. Prior to 1984, Yuchai was a small producer of low-power diesel engines for agricultural machinery. In 1984, Yuchai introduced the earliest model of its YC6J diesel engine for medium-duty trucks. In July 1992, in order to raise funds for further expansion, Yuchai was restructured into a joint stock company. As a result of this restructuring, Yuchai was incorporated as a joint stock company in July 1992 and succeeded the machinery business of Yulin Diesel. All of Yulin Diesel’s businesses, other than its machinery business, as well as certain social service-related operations, assets, liabilities and employees (for example, cafeterias, cleaning and security services, a hotel and a department store), were transferred to the GY Group. The GY Group also became the majority shareholder of Yuchai through its ownership stake of approximately 104 million shares of Yuchai, or GY Group Shares. In connection with its incorporation, Yuchai also issued seven million shares to various Chinese institutional investors, or Legal Person Shares. In May 1993, in order to finance further expansion, Yuchai sold shares to the Company. Our initial shareholders, consisting of HL Technology, Sun Yuan Overseas (BVI) Ltd., or Sun Yuan BVI, The Cathay Investment Fund, Limited, or Cathay, GS Capital Partners L.P., and Coomber, then a wholly-owned subsidiary of China Everbright Holdings and, thus, controlled by China Everbright International Limited, or China Everbright International, made their initial investments in Yuchai in May 1993, when their respective wholly-owned subsidiaries purchased for cash in the aggregate 200 million newly-issued shares of Yuchai (51.3% of the then-outstanding shares of Yuchai). These shareholders exchanged with the Company their shareholdings in their wholly-owned subsidiaries, six companies which held Foreign Shares of Yuchai, for 20 million shares of our common stock (after giving effect to a 10-for-1 stock split in July 1994, or the Stock Split). In connection therewith, Yuchai became a Sino-foreign joint stock company (i.e., a foreign-invested enterprise under the PRC Foreign Investment Law effective on January 1, 2020) and became subject to the laws and regulations relating to joint stock limited liability companies and Sino-foreign joint venture companies in China. Foreign Shares may be held by and transferred to non-Chinese legal and natural persons, subject to the approval of the Ministry of Commerce, the successor entity to the Ministry of Foreign Trade and Economic Cooperation of China, or MOFTEC. Foreign Shares are entitled to the same economic rights as GY Group Shares and Legal Person Shares. GY Group Shares are shares purchased with state assets by government departments or organizations authorized to represent state investment. Legal Person Shares are shares purchased by Chinese legal persons or institutions or social groups with legal person status and with assets authorized by the state for use in business. In November 1994, we purchased from an affiliate of China Everbright Holdings 78,015,500 Foreign Shares of Yuchai in exchange for the issuance of 7,801,550 shares of our common stock (after giving effect to the Stock Split), or the China Everbright Holdings Purchase. The 78,015,500 Foreign Shares of Yuchai held by Earnest Assets Limited, a subsidiary of China Everbright Holdings and China Everbright International before its sale to us had been originally issued as Legal Person Shares and GY Group Shares and were converted to Foreign Shares, pursuant to approvals granted by MOFTEC. As a result, the Company became the owner of each of these six companies: Hong Leong Technology Systems (BVI) Ltd., Tsang & Ong Nominees (BVI) Ltd., Cathay Diesel Holdings Ltd., Goldman Sachs Guangxi Holdings (BVI) Ltd., Youngstar Holdings Limited and Earnest Assets Limited. In December 1994, we sold 7,538,450 shares of common stock in our initial public offering and used substantially all of the proceeds to finance our six wholly-owned subsidiaries’ purchase of 83,404,650 additional Foreign Shares in Yuchai. In connection with our purchase, through our six wholly-owned subsidiaries, of additional Yuchai Shares with proceeds of our initial public offering, Yuchai offered additional shares pro rata to its other existing shareholders (30 shares for each 100 shares owned) in accordance with such shareholders’ pre-emptive rights, and each of our subsidiaries was able to acquire these additional Foreign Shares in Yuchai. Such pro rata offering (including the offering to the Company) is referred to herein as the “Yuchai Offering.” Certain Legal Person shareholders subscribed for additional shares in the Yuchai Offering. The GY Group informed Yuchai at the time that it would not subscribe for any of its portion of Yuchai Shares (31,345,094 shares) in the Yuchai Offering. In order to obtain MOFTEC’s approval of the Yuchai Offering, the GY Group was given the right by Yuchai’s Board of Directors to subscribe for approximately 31 million shares of Yuchai at a price of RMB 6.29 per share at any time prior to December 1998. This was because provisional regulations of the State Administration Bureau of State Property, or SABSP, and the State Committee of Economic System Reform, or SCESR, published in November 1994, imposed on any holder of state-owned shares certain obligations to protect its interest in any share offering. Under such regulations, the GY Group could have been required to subscribe for Yuchai Shares in the Yuchai Offering. Yuchai’s shareholders subsequently agreed to extend the duration of such subscription right to March 31, 2002 (the exercise of which would have reduced our ownership of Yuchai from 76.4% to 71.7%). The GY Group informed the shareholders of Yuchai that it had determined not to subscribe for additional Yuchai Shares and this determination was noted by Yuchai’s Board of Directors on November 1, 2002. However, given the November 1994 provisional regulations of the SABSP and the SCESR, the SABSP, the SCESR and/or the Ministry of Commerce may take action against the GY Group, and there can be no assurance that any such action would not, directly or indirectly, have a material adverse effect on Yuchai or the Company. 29 Table of Contents Reorganization Agreement On April 7, 2005, we entered into the Reorganization Agreement with Yuchai and Coomber, which is intended to be in furtherance of the implementation of the restructuring contemplated in the agreement dated July 19, 2003 between the Company and Yuchai with respect to the Company’s investment in Yuchai (the “July 2003 Agreement”), as amended and incorporated into the Cooperation Agreement on June 30, 2007. The terms of the Reorganization Agreement have also been acknowledged and agreed to by GY. The Reorganization Agreement provides for the implementation of corporate governance guidelines approved by the directors and shareholders of Yuchai in November 2002 and outlines steps for the adoption of corporate governance practices at Yuchai conforming to international custom and practice. Pursuant to the Reorganization Agreement, Yuchai also acknowledged and affirmed our continued rights as majority shareholder to direct the management and policies of Yuchai through Yuchai’s Board of Directors. Subsequent to the execution of the Reorganization Agreement, a number of steps have been taken by the parties thereto towards its implementation. For example, Yuchai’s directors and shareholders have confirmed that the amendments to Yuchai’s Articles of Association and corporate governance guidelines required to be adopted by Yuchai pursuant to the Reorganization Agreement have been ratified and implemented, and that steps are being taken to have such amendments and guidelines approved by the relevant Chinese authorities. The amended Articles of Association was approved by the Guangxi Department of Commerce on December 2, 2009. Cooperation Agreement The Reorganization Agreement was scheduled to terminate on June 30, 2007. On June 30, 2007, we entered into the Cooperation Agreement with Yuchai, Coomber and GY. The Cooperation Agreement amends certain terms of the Reorganization Agreement, as amended, among CYI, Yuchai and Coomber, and as so amended, incorporates the terms of the Reorganization Agreement. Pursuant to the amendments to the Reorganization Agreement, the Company agreed that the restructuring and spin-off of Yuchai would not be effected, and, recognizing the understandings that have been reached between the Company and GY to jointly undertake efforts to expand the business of Yuchai, the Company would not seek to recover the anti-dilution fee of US$20 million from Yuchai. The Cooperation Agreement provides that the parties will explore new business opportunities and ventures for the growth and expansion of Yuchai’s existing businesses. Although the parties to the Cooperation Agreement expect to work towards its implementation as expeditiously as possible, no assurance can be given as to when the transactions contemplated therein will be consummated. Various amendments to Yuchai’s Articles of Association had been ratified and adopted by Yuchai in 2007 and were approved by the Guangxi Department of Commerce on December 2, 2009. B. Business Overview Emission Standards Since the introduction of China National I in the early 2000s, Chinese regulators have progressively tightened the limits on permissible emissions of on-road diesel vehicles and off-road machinery. In an effort to combat increasing air pollution, China’s vehicle industry transitioned to the National IV and National V emission standards from 2013 to 2018, reflecting a significant leap in emission control within just five years. The latest emission standard, known as National VI, was implemented in July 2021. Yuchai produces diesel engines and natural gas engines compliant with the National V and National VI emission standards, and has a portfolio of engines that are compliant with National VIb emission standards implemented in July 2023. It also develops alternative fuels and environmentally friendly hybrid systems with improved fuel efficiency. For off-road machinery, the Tier-3 emission standards were implemented nationwide on December 1, 2016. The Tier-4 emission standards have been enforced from December 2022 for all diesel off-road equipment with engine sizes smaller than 560kW. Yuchai has fulfilled the Tier-4 emission standards for use in off-road machinery. China may introduce the next generation of emission standards, commonly referred to as National VII for on-road vehicles and Tier-5 for off-road machinery. However, as of February 27, 2026, no official announcement or timeline for the implementation of National VII and Tier-5 has been formally issued by the relevant regulatory authorities. 30 Table of Contents China has introduced and, in the future, may introduce certain regulatory requirements applicable to specific vehicle segments from time to time. In September 2024, the Ministry of Industry and Information Technology published and finalized the Stage 4 Fuel Consumption Standards for Commercial Vehicles. These standards impose more stringent fuel consumption limits on new heavy-duty vehicles with a gross weight exceeding 3,500 kg, including straight trucks, dump trucks, tractor-trailers, and buses. On average, the Stage 4 standards are estimated to tighten fuel consumption requirements by approximately 10% to 15% compared to the previous Stage 3 limits. The implementation scheduled for these new standards follows a phased approach. Effective July 1, 2025, all new heavy-duty vehicle type approval must comply with the Stage 4 standards. By August 1, 2027, all new heavy-duty vehicles sold or registered in China must meet these standards. Yuchai has been working with OEMs partners to meet these targets through improvement of both engine and integrated vehicle design. Yuchai’s National VI compliant engines are fully compliant with the new regulation. Products and Key Product Development — Yuchai Yuchai engages in the design, manufacture, assembly, and sale of a wide variety of light-, medium- and heavy-duty engines for trucks, buses, pickups, construction and agricultural equipment, and marine and power generation applications. Yuchai offers a comprehensive portfolio of powertrain solutions, including but not limited to diesel, natural gas, alternate fuels and new energy products such as pure electric, range extenders, and hybrid and fuel cell systems. Through its extensive network of regional sales offices and authorized customer service centers, Yuchai distributes its engines directly to auto OEMs and distributors while providing after-sales services across China and globally. Yuchai is devoted to improving its competitiveness across all engine platforms, including its light-, medium- and heavy-duty engines, in compliance with applicable emission standards. Yuchai has established a portfolio of on-road engines that meet the National VIb emission standards, which was implemented in China on July 1, 2023. Yuchai also offers a full range of off-road engines that meet the Tier-4 emission standards that came into effect in December 2022. Yuchai is also expanding its production and research and development capabilities in new energy technologies, including alternate fuel engines, hybrid power and electric drive systems, range extender systems, electric drive axles and fuel cell systems. Yuchai has launched a series of innovative powertrain and engine solutions in recent years. In September 2023, Yuchai launched the 350hp IE-Power hybrid system for heavy-duty tractor applications which features continuously variable transmission function for both tractor and other heavy-duty agricultural machinery. In the same month, Yuchai launched the YCK15N gas engine for heavy-duty vehicles, designed for operation at high altitudes and extreme weather conditions, with a rated output of 570hp and maximum torque of 2600 N-m. In 2024, Yuchai launched the YCK14N gas engine for heavy-duty for heavy-duty trailers and cargo trucks, with a designed output of 540 PS and a maximum torque of 2500 N-m. In addition, Yuchai extended its casting capabilities in traditional powertrain solutions business and launched wind turbine main shafts for China-based OEMs. In 2025, Yuchai launched the K16, K18 and K20 off-road engines for heavy-duty industrial and mining applications. At its marine and generation power business unit, Yuchai also launched the VTF series engine for power generation. The 16 cylinders VTF engine has a maximum rated output of 3.9MW for prime and stand-by operations. Existing Engine Products Yuchai offers a full portfolio of on- and off-road engine products in compliance with National VI and Tier-4 emission standards, respectively. Yuchai’s National V and Tier-3 compliant engines have been phased out from the China market following the full implementation of the National VI and Tier-4 emission standards, while certain National V and Tier-3 products are retained for export markets. Yuchai manufactures engines for trucks, buses and passenger vehicles, marine and industrial applications and generator sets. The following table sets forth Yuchai’s list of engines by application: Series Truck YCY24, YCY30, YCS04, YCS06, YCK05, YCK08, YCK08N, YCK09, YCK11, YCK11N, YCK13, YCK13N, YCA07N, YCK14N, YCK15N, YCK15M Bus YCY24, YCY30, YCS04, YCS06, YCK05, YCK08, YCK08N, YCK09, YCK11 Construction YCF24, YCF30, YCF36, YCA05, YCA07, YCA08, YCK09, YCK11, YCK13, YCK16, YCTD20, YCK18, YCK20 Agriculture YCF30, YCF36, YCA05, YCA07, YCA08, YCK09, YCK11, YCK13, YCK16, YCTD20 Marine YC4FA, YC6T, YC6TD, YC6C, YC6CL, YC6CD, YC8CL, YC12VC Generator-Drive YC4R, YC4FA, YC6A, YC6LN, YC6KN, YC6T, YC6C, YC6CL, YC12VC, YC12VTD, YC16VTD, YC16VC, YC16VTF 31 Table of Contents Yuchai’s existing engine products include light-, medium- and heavy-duty engines as set forth in the following table. Series Light-Duty YC4FA, YCY24, YCY30, YCF30, YCF36 Medium-Duty YC6A, YCK05, YCS06, YCS04, YCA05, YCA07, YCA08, YCK08N Heavy-Duty YC6LN, YC6K12, YC6KN, YC6K13N, YC6T, YC6C, YC6CN, YC6CL, YC8CL, YC12VTD, YC12VC, YC16VC, YC6CD, YC6TD, YCK08, YCK09, YCK11, YCK11N, YCK13, YCK13N, YCK14N, YCK15N, YCK16, YCK18, YCK20, YCTD20 (a)4-Cylinder Diesel Engines Trial production of the 4-cylinder diesel engines commenced in late 1999 and today, they represent a stable of reliable and high- performance engines. Our line of 4-cylinder diesel engines consists of the following models: •The YCY24 engine compliant with National VI emission standards is for use in passenger vehicles, light-duty buses and pick-up trucks. It has a displacement volume of 2.36 liter and a maximum power output of 150 PS with a maximum torque of 380 N-m. •The YCY30 engine compliant with National VI emission standards is for use in light-duty buses and trucks. It has a displacement volume of 2.97 liter and a power range of 150-180 PS with a maximum torque of 460 N-m. •The YCS04 engine compliant with National VI emission standards is for use in light to medium-duty buses and trucks. It has a displacement volume of 4.16 liter and a maximum power output of 180 PS with a maximum torque of 650 N-m. •The YCA05-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 4.8 liter and a maximum power output of 220 PS with a maximum torque of 720 N-m. •The YCF30-T48 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 3.0 liter and a maximum power output of 120 PS with a maximum torque of 430 N-m. • The YCF36-T48 engine compliant with off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 3.6 liter and a maximum power output of 125 PS with a maximum torque of 480 N-m. •The YCF36-T40 engine compliant with off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 3.6 liter and a maximum power output of 150 PS with a maximum torque of 500 N-m. (b)6-Cylinder Diesel Engines Our line of 6-cylinder diesel engines consists of the following models: •The YCS06 engine compliant with National VI emission standards is for use in medium-duty trucks, coaches and buses. It has a displacement volume of 6.23 liter and a maximum power output of 260 PS with a maximum torque of 1000 N-m. •The YCK05 engine compliant with National VI emission standards is for use in medium-duty trucks, coaches and buses. It has a displacement volume of 5.1 liter and a maximum power output of 230 PS with a maximum torque of 870 N-m. •The YCK08 engine compliant with National VI emission standards is for use in medium-duty and special purpose trucks, highway coaches and buses. It has a displacement volume of 7.7 liter and a maximum power output of 350 PS with a maximum torque of 1400 N-m. •The YCK09 engine compliant with National VI emission standards is for use in medium to heavy-duty trucks, highway coaches and buses. It has a displacement volume of 9.41 liter and a maximum power output of 380 PS with a maximum torque of 1800 N-m. •The YCK11 engine compliant with National VI emission standards is for use in heavy-duty trucks and trailers, highway coaches and buses over 10 meter in length. It has a displacement volume of 10.84 liter and a maximum power output of 500 PS with a maximum torque of 2200 N-m. •The YC6K12 engine compliant with National VI emission standard is for use in heavy-duty trucks and trailers. It has a displacement volume of 12.15 liter and a maximum power of 520 PS and a maximum torque of 2200 N-m. 32 Table of Contents •The YCK13 engine compliant with National VI emission standards is for use in heavy-duty trucks and trailers, and highway coaches. It has a displacement volume of 12.94 liter and a maximum power output of 560 PS with a maximum torque of 2500 N-m. •The YCA07-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural applications. It has a displacement volume of 6.9 liter and a maximum power output of 260 PS with a maximum torque of 1050 N-m. •The YCA08-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 7.5 liter and a maximum power output of 320 PS with a maximum torque of 1200 N-m. •The YCK09-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 9.4 liter and a maximum power output of 400 PS with a maximum torque of 1900 N-m. •The YCK11-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 10.8 liter and a maximum power output of 480 PS with a maximum torque of 2200 N-m. •The YCK13-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 12.9 liter and a maximum power output of 580 PS with a maximum torque of 2600 N-m. •The YCK16-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 15.9 liter and a maximum power output of 775 PS with a maximum torque of 3200 N-m. •The YCTD20-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 19.6 liter and a maximum power output of 952 PS with a maximum torque of 3800 N-m. •The YCK18-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 18.06 liter and a maximum power output of 810 PS with a maximum torque of 3800 N-m. •The YCK20-T40 engine compliant with China off-road Tier-4 emission standards is for use in industrial and agricultural off-road applications. It has a displacement volume of 19.6 liter and a maximum power output of 880 PS with a maximum torque of 4100 N-m. (c)High Horsepower Marine and Power Generator Engines In May 2011, Yuchai commenced construction of a plant at Yuchai’s primary manufacturing facilities in Yulin City, Guangxi Zhuang Autonomous Region, to increase the annual production capacity of high horsepower engines to meet increasing demand for marine, power generation and industrial applications. In 2022, Yuchai carved out its marine and power generation engine business sector and transferred it to its subsidiary, MGP. The following are our high horsepower engine models, all of which are produced by MGP. •YC6T is a 6-cylinder engine rated at 360 to 600 PS and is suitable for construction applications. It is used in marine propulsion, power generators, construction and mining trucks. The YC6T engine rated at 404 to 440 kW at 1500 rpm is for power generation, while those rated at 290 to 396 kW at 1500 to 1800 rpm are for marine applications and those rated at 350 to 540 PS at 1350 rpm are for marine propulsion. •YC6C is a 40 liter, 6-cylinder engine rated at 700 to 1000 PS. It was launched in early 2011 and is used in marine propulsion, power generators, construction and mining trucks. The YC6C engine rated 680 to 850 kW at 1500 rpm is for power generation and those rated 560 to 680 kW at 1500 rpm are for marine propulsion. •YC6CL is an upgraded version of the YC6C engine with longer piston stroke for better power output and performance. It is a 54 liter engine rated at 800 to 1200 PS. •YC12VTD is derived from the YC6TD engines where the V-engine enables the engine to have a compact configuration. The engine is 12-cylinder, 39 liter rated at 900 to 1345 kW at 1500 rpm, mainly for application in the power generator, marine and industrial markets. The YC12VTD was launched in 2018. 33 Table of Contents •YC16VTD is derived from the YC6TD engine where the V-engine enables the engine to have a compact configuration. The engine is 16-cylinder, 52 liter rated at 1520 to 1680 kW at 1500 rpm, mainly for application in the power generator, marine and industrial markets. The YC16VTD was launched in 2018. •YC12VC is derived from the YC6C engines where the V-engine enables the engine to extend its power output at similar engine platform. The engine is 12-cylinder, 80 liter rated at 1120 to 1800 kW at 1500 rpm. The main application is in the power generator, marine and industrial markets. The YC12VC was commercially launched in 2015. •YC16VC is derived from the YC6C engines where the V-engine enables the engine to extend its power output at similar engine platform. The engine is 16-cylinder, 108 liter rated at 1960 to 3608 kW at 1500 rpm. The main application is in the power generator, marine and industrial markets. The YC16VC was commercially launched in late 2016. •YC8CL is an extended version of YC6CL engine, with 8-cylinder in line configuration. YC8CL is an 8-cylinder, 72.8 liter engine rated at 692 to 1176 kW at 750 to 1000 rpm. The main application is in marine propulsion for river trade and costal general cargo vessels. The YC8CL was officially launched in mid-2017. •YC16VTF is a newly designed high horsepower engine, available in 16- and 20- cylinder configurations. It is designed to operate at 1500, 1800, and 2100 rpm, with the maximum-rated 2100 rpm variant delivering an output of 3971 kW. The main application is power generation and marine markets. The YC16VTF is at development stage and expected to have commercial launch in 2027. (d)Other Products and Services Natural Gas Engines Yuchai has a facility at its primary manufacturing facility in Yulin City, Guangxi Zhuang Autonomous Region, to develop and produce a portfolio of natural gas-powered engines to complement its existing suite of diesel engines. The main uses of Yuchai’s natural gas engines are in large buses, medium- to heavy-duty trucks, industrial and power generators and the marine sector. Yuchai natural gas engines are designed to work with both CNG and LNG fuel systems, and they are generally constructed using similar major components as Yuchai’s diesel engines. Yuchai currently offers natural gas engines in the following models: YCA07N, YC6JN, YC6GN, YC6LN, YC6MKN, YCK08N, YCK11N, YCK13N and YCK15N ranging from 120 to 570 hp. Among these engines, YCA07N, YCK08N, YCK11N, YCK13N, YCK14N and YCK15N are natural gas engines compliant with National VI emission standards. Hydrogen Combustion Engines Yuchai has developed carbon-free hydrogen combustion engine models YCK05H and YCK16H for on-road applications. YCK05H is a 4-cylinder engine with a designed output of 175hp, and YCK16H is a 6-cylinder engine with a designed output of 560hp. Prototypes of both engine models have been installed on testing trucks for performance testing. Methanol Combustion Engines Yuchai has developed the low carbon methanol combustion engine YCK15M for on-road applications with a designed output of 380 PS and maximum torque of 1800 N-m. Power Generator Sets Yuchai has a history of more than 40 years for producing power generator sets, with wide application in both the civil and marine sectors. Yuchai produces power generator sets which are primarily used in the baseload and standby power generation application. The generator set includes an intelligent digital controlling system, remote control, generators group control, remote monitoring, automatic parallel operation, and automated protection against breakdowns. Engine Components and Parts Yuchai supplies engine components and parts to its nationwide chain of service stations in China and globally. The availability of such components and parts to Yuchai’s customers and to end-users through its chain of service stations is an important part of Yuchai’s customer service program. Yuchai is continually improving the distribution channel services of its engine components and parts to maintain its competitive position. 34 Table of Contents New Energy Products Yuchai has developed and produced new energy products, including flywheel range extension system, new generation hybrid system, pure electric drive, pure electric axle drive and fuel cell systems. (a)Second generation hybrid system The power of Yuchai’s first generation of hybrid system products ranges from 110kW to 210kW. The second-generation hybrid system has achieved major upgrades that have led to adaptability advantages over the previous generation with stronger power, higher operating efficiency, improved fuel-savings, simpler layout of the cooling system, more concise and reliable structure, richer interfaces, and wider applicability to different scenarios. Yuchai’s second generation hybrid system adopts a high-speed oil-cooled motor, which reduces the heat dissipation of the motor by 75%, and the electromechanical performance is highly coupled, helping to achieve higher fuel-saving performance. Products series include YCHS105T-A05K22, YCHS180T-A0822, YCHS190T-A0822, YCHS200T-K0922, YCHS210T-K0922, YCHS220T-K0922, and YCPD230-A07N22. (b)Flywheel Range Extender System The Yuchai’s flywheel range extension system combines the power source and the power generation unit in the physical structure through a rigid coaxial integration flywheel design and engine crankshaft. This core breakthrough, combined with intelligent coupling control algorithms and multi-scenario adaptive energy management strategies, is the culmination of the evolution of range extenders from split to integrated assembly, which has led to a comprehensive leap in efficiency, reliability and spatial layout. Yuchai’s flywheel range extender products range from 15kW to 550kW, and support a wide range of fuel types, including diesel, natural gas, methanol and hydrogen, including YCRE015T-F1120, YCRE030T-F3020, YCRE065T-F3020, YCRE075-S0420, YCRE100-Y2520, YCRE100C-4A20, YCRE150-A07M20, YCRE170-K08N20, YCRE200-K09LN20, YCRE200-S0720, YCRE250T, K09L20, YCRE280-K12LM20, YCRE300C-6MJ20, YCRE350T-K15N20, YCRE350T-K16LN20, YCRE350T-K16LM20, and YCRE550T-K2020. (c)Full Electric Power Systems Pure electric box drive For commercial vehicle heavy-duty trucks and non-road mining truck box drives applications, Yuchai Simlan has developed high-speed flat wire motors, reducers and gearbox products. These products use high-overlap gear design, flat wire water cooling technology with aluminum alloy shell. Motor power ranges from 220kW to 270kW, and the maximum efficiency of the system is greater than 96%, with a wide coverage of the high-efficiency area. The gearbox adopts a high synchronized gear design, with a large speed ratio and a maximum output torque of up to 30000N.m; with precise spraying for lubrication to achieve effective cooling under various working conditions. The efficiency of the integrated electric motor transmission gearbox reaches more than 96.5%, and the overall performance of the product is excellent. Products include YCET270-0242, YCET270-1200, YCET280-0242, YCET280-0300, YCET280-0341, YCET280-0342, YCET280T-0242, YCET280T-0300, YCET280T-0342, YCET350T-0242, YCET500T-1232, and YCET660T-0532. Pure electric axle drive For commercial vehicle light-duty truck applications, Yuchai Simlan has developed a two-in-one drive system with motor electronic control, with a power range of 35kW to 140kW. The motor with electronic control has a highly integrated design, compact in size, and convenient layout of the vehicle chassis. The highest vibration resistance is 11G, EMC high-voltage conduction meets the requirements of GB 18655 standard Class 3 level, and the electric drive system adopts a co-shell design, which is lighter in weight, enhances its competitiveness. Products include YCEA02035-031, YCEA03035-031, YCEA03050-030, YCEA03050-031, YCEA03070-031, YCEA04070-031, YCEA05090-031, and YCEA07090-032. For commercial vehicle heavy-duty truck applications, Yuchai Simlan has developed a 13T heavy-duty axle drive system, with a power range of 220kW to 270kW. These products adopt a three-speed shift system. As a result, even under complex working conditions, it can well support the motor to run in a high-efficiency zone, while the transmission assembly lubrication and cooling module enable the axle assembly to effectively lubricate the bearing and reduce the temperature rise in various working condition. Products include YCEA210-0500, YCEA220-0530, YCEA270-0500, and YCEA270-0530. 35 Table of Contents (d)Fuel Cell System (“YC FCS”) Yuchai has developed its highly efficient PEM stack electrolyser for fuel cell battery system as well as its hydrogen generating system. The YC FCS fuel cell systems with 90 to 120kW designed outputs have been installed on public transit fleet city buses for routine operation since late 2023 and clocked a total more than 2.73 million km. Sales In 2025, according to CAAM, engine sales for commercial vehicles (excluding gasoline-powered and electric-powered vehicles) in China were approximately 2.4 million units, an increase of 4.5% compared to 2024. Yuchai’s commercial vehicle engine sales in 2025 were 213,324 units, an increase of 42.8% compared to 149,371 units in 2024. Yuchai’s total engine sales in 2025 were 461,309 units, an increase of 29.4% compared to 356,586 units in 2024. Yuchai’s light-duty engine sales in 2025 were 131,124 units, or 28.4% of total unit sales, compared to 28.5% in 2024, where light-duty engine sales were 101,676 units. Medium-duty engine sales were 188,756 units, or 40.9% of total unit sales, compared to 2024 where sales were 164,986 units, or 46.3% of total unit sales. Heavy-duty engine sales were 110,043 units, or 23.9% of total sales units, compared to 2024 where sales were 76,002 units, or 21.3% of total unit sales. In 2025, Yuchai sold 24,591 units of natural gas engines compared with 11,279 units sold in 2024. The following table sets forth a breakdown of Yuchai’s sales by major product category for fiscal years 2023, 2024 and 2025: 2023 2024 2025 Revenue % of Revenue Unit Sold Revenue % of Revenue Unit Sold Revenue % of Revenue Unit Sold RMB’000 RMB’000 RMB’000 Light-duty engines 1,621,538 9.0 % 72,875 2,258,692 11.8 % 101,676 2,644,834 10.7 % 131,124 Medium-duty engines (1) 5,696,186 31.6 % 169,498 5,201,611 27.2 % 164,986 5,563,174 22.6 % 188,756 Heavy-duty engines (1) 5,552,544 30.8 % 62,611 6,417,484 33.6 % 76,002 9,755,682 39.6 % 110,043 Other products and services (2) 5,145,012 28.6 % 8,509 5,225,010 27.4 % 13,922 6,662,058 27.1 % 31,386 18,015,280 100.0 % 313,493 19,102,797 100.0 % 356,586 24,625,748 100.0 % 461,309 Notes: (1)Includes natural gas engines. (2)Includes components and parts, power generator sets, NEV products and others. Production Yuchai’s primary manufacturing facilities are located in Yulin City in the Guangxi Zhuang Autonomous Region. The principal production land area currently occupies approximately 1.8 million square meters, including an existing production factory for all light-, medium- and heavy-duty engine models, a natural gas production facility, a high horse power marine diesel engine and power generator plant, a foundry and various testing and supporting facilities. Yuchai has centralized its production of marine and power generator engines and power generator sets under MGP, following the carve-out of the marine and power generator business and associated assets from Yuchai’s main operating entity to MGP in 2022. For the years ended December 31, 2024 and 2025, the total production capacity of Yuchai (excluding Yuchai Simlan) was approximately 633,000 units each year based on a 2.0 shift five-day week at 80% utilization rate. For the new energy sector, production is managed under Yuchai Simlan and its subsidiaries, primarily located in Nanning City, Guangxi Zhuang Autonomous Region, with an annual production capacity of approximately 30,000 units. 36 Table of Contents In 2025, we produced 387,766 units of engines. The following table sets forth the breakdown of Yuchai’s production in the Guangxi Zhuang Autonomous Region by major product category for the years ended December 31, 2023, 2024 and 2025: 2023 2024 2025 Units % of Units Units % of Units Units % of Units Light-duty engines 70,500 25.5 % 93,806 30.2 % 106,831 27.6 % Medium-duty engines (1) 142,984 51.7 % 134,955 43.4 % 151,599 39.1 % Heavy-duty engines (1) 55,167 19.9 % 66,061 21.2 % 99,119 25.6 % Other products and services (2) 8,042 2.9 % 16,153 5.2 % 29,991 7.7 % 276,693 100.0 % 310,975 100.0 % 387,540 100.0 % Notes: (1)Includes natural gas engines. (2)Includes power generator sets, NEV products and others In 2024, Yuchai’s wholly-owned subsidiary, Yuchai Machinery Power System (Thailand) Co., Ltd., or Yuchai Thailand, commenced production operations as its first K08 engine from Thailand factory rolled off the production line. Yuchai Thailand expects to produce a range of diesel engines, natural gas engines and new energy power products. Its existing production capacity is 1,000 units, and may be expanded in the future according to market demand. Procurement Yuchai manufactures engine blocks, cylinder heads, crankshafts, camshafts and certain other key parts. Third-party suppliers, including related parties, provide the remaining engine parts and components. The production process involves the complete assembly and testing of the finished products. Yuchai’s procurement policy aims to source purchases from more than one supplier. Yuchai is continually seeking to improve its procurement strategy by seeking new suppliers with competitive prices and quality. Yuchai has progressively reduced its reliance on imported parts and components in recent years, in part due to an increasing number of international suppliers having local manufacturing and logistics capabilities in China. For instance, Yuchai’s fuel combustion equipment and its electronic control systems are purchased from the local factory of an international supplier operating in China. Engine Block Yuchai cast and molded more than 400,000 units of engine blocks in 2025, representing a large portion of its engine blocks used in production. Raw Materials Yuchai purchases raw materials, principally scrap steel and cast iron, from domestic suppliers. An increase in the prices of these raw materials would generally increase our costs of production. We have experienced volatility in the prices of raw materials in the past. See also “Item 3. Key Information — D. Risk Factors — Risks Related to Our Business and Industry — If prices of energy, raw materials or components increase, it may adversely affect our profitability or cause us to suffer operating losses.” Quality Assurance, Control and Safety All raw materials, external supplied parts and components are checked for conformity with the required quality and specifications. Each stage of the production process is monitored by a quality control procedure and the final product undergoes standard conformity and specification testing using an automated testing laboratory. To promote the safety of its workers, Yuchai has established a safety department to supervise the proper use of equipment to prevent fire and explosions and promote safe practices and procedures in the workplace. 37 Table of Contents Manufacturing Capacity Expansion Yuchai believes that the current production capacity of all engine lines shall cater for the organic growth of business and its products offering and portfolio. Nevertheless, Yuchai is cautiously evaluating the continuous upgrade and enhancement of manufacturing capabilities in order to meet evolving market demands and expectations. Yuchai also continuously assesses customer experience and refines its production strategies to capture market opportunities. Given the capital-intensive nature of our capacity expansion and its relatively long payback period, Yuchai outsources certain machining processes to external service providers to optimize internal capacity utilization and support incremental expansion, enabling more flexible and efficient scaling. Research and Development Yuchai has devoted substantial resources to research and development (“R&D”) to enhance technological capabilities, improve product performance and maintain competitiveness. Its R&D efforts focus primarily on designing new products, improving manufacturing processes and adapting technologies based on evolving market requirements. Yuchai also collaborates with research institutions in China and globally, design consulting firms and engine and components manufacturers to support its technology development efforts. It maintains a dedicated and professional R&D team. Dr. Lin Tiejian, the Chief Engineer of Yuchai was honored in January 2024 with the National Engineer Award for his exceptional contributions to the field of engineering technology in China. A significant portion of our R&D efforts has been dedicated to ensuring that our product lineup meets evolving environmental mandates. Yuchai has developed a range of products that comply with stringent emission standards, including National VI standards particularly the more stringent National VIb standards for on-road vehicles, as well as Tier 4 standards for off-road machinery. We continue to invest to upgrade our engines for better performance, improved fuel efficiency, and reduced noise, vibration, and harshness. In the field of new energy, Yuchai has been developing alternative fuel combustion engines, including hydrogen, methanol and ammonia combustion. In September 2023, Yuchai launched the 350hp IE-Power system for heavy-duty tractors, featuring a continuously variable transmission, enhanced maneuverability and performance for heavy-duty tractors and other agricultural machinery. In 2024, Yuchai Simlan commenced small-batch production of a new energy locomotive equipped with the YCK16 500kW range extender. This deployment represents an expansion in the rail transit sector, demonstrating our dedication to promoting the green transformation and upgrading new energy rail transit equipment. With its expertise in the field of hydrogen combustion engines, Yuchai was appointed as a Committee Member of the new Hydrogen Combustion Engine Innovation Consortium division of the China Internal Combustion Engine Society in 2024. In 2025, Yuchai Simlan expanded its product range with the introduction of 270/400kW 13T electric drive axle power system for heavy-duty trucks, 140/230 kW integrated motor and electronic control power system for light trucks, and 350/510kW overload box drive system for heavy-duty trucks. Yuchai has been actively advancing its new energy strategy through the development and commercialization of alternative fuel and electrified power solutions. It is investing in hydrogen, methanol, and ammonia combustion technologies, while expanding its presence across on-road, off-road, marine, and rail transit applications. Recent initiatives include the launch of integrated electric and hybrid powertrain systems, range extenders, and high-performance engines tailored for heavy-duty vehicles, agricultural machinery, and power generation. Yuchai has also begun commercial deployment of hydrogen-powered engines and achieved regulatory certification for methanol engines, demonstrating tangible progress in low- and zero-emission technologies. These efforts reflect Yuchai’s commitment to driving the green transformation of the transportation and equipment industries through innovation in new energy solutions. Future Products Yuchai believes that its long-term business prospects will largely depend upon its ability to develop and commercialize new or improved products with enhanced quality and competitive pricing. Future products may incorporate evolving technologies and may require expertise in markets where Yuchai currently has limited experience. Yuchai intends to continue to work with international design consulting firms and international manufacturers for technological assistance in improving and developing its combustion engine products and new energy systems, and expects such cooperation to continue. Yuchai has participated in collaborations with research institutions and technology providers to advance its new energy technologies, such as fuel-cell systems, and intends to further expand these R&D efforts for its future products. The development and commercialization of new products and energy solutions generally require significant capital investment, including expenditures on advanced manufacturing equipment and technologies. See “Item 3. Key Information — D. Risk Factors — Risks Related to Our Business and Industry — Competition from other diesel engine manufacturers may adversely affect our financial condition, results of operations, business or prospects.” 38 Table of Contents Intellectual Property As of December 31, 2025, Yuchai had established a large intellectual property portfolio, consisting of 1,634 invention patents, 2,349 utility model patents, and 15 design patents, as well as 27 patents filed under the Patent Cooperation Treaty for international protection and 260 software copyrights in China. Depending on the type of patent, including international patents, the term of protection is generally 10 or 20 years from the filing date. The term of protection for software copyrights is 50 years from its first publication. Yuchai’s patent development efforts focus on enhancing product performance, manufacturability and cost competitiveness across its product portfolio. Yuchai’s patents can be broadly categorized into three groups: •Structural patents, which focus on fundamental design innovation and refinement of core engine components, including cylinder blocks, cylinder heads, crankshafts, pistons and connecting rods, with an emphasis on high-strength, lightweight solutions; •Control patents, which relate to the optimization of engine operation throughout the product life cycle, including fuel injection, power and speed control, cooling and lubrication systems, intake and exhaust management, turbo charging control and error diagnostics; and •Process patents, which focus on manufacturing and assembly processes for key components, improving precision, consistency and production efficiency. These include advancements in process parameters and proprietary techniques addressing technical challenges in areas such as precision machining, heat treatment and assembly calibration. Yuchai seeks to protect its technology and intellectual property through a combination of trademark, copyright, patent and trade secret protection laws, as well as confidentiality procedures and contractual provisions. Yuchai enters into confidentiality and invention assignment agreements with key R&D personnel, and maintains strict controls over access to its proprietary technologies and information. It has adopted and implemented internal procedures for monitoring and combating the counterfeiting of its products and protecting its intellectual property rights. Externally, it engages third-party service providers to assist it to track and take actions against such illegal counterfeiting of its products. Yuchai primarily develops its technologies and patents for its own production and sales, while also exploring opportunities to commercialize its technologies and patents in overseas markets. In 2024, Yuchai entered into a comprehensive cooperation agreement with Kim Long Motor Hue, or Kim Long Motor, a subsidiary of Vietnam’s FUTA Group. Under this agreement, Yuchai granted Kim Long Motor technology licensing rights for certain model engine series, which will be manufactured for trucks, buses and other commercial vehicles in Vietnam. Kim Long Motor has exclusive sales rights for these engines in the Vietnam market, along with priority sales rights in other ASEAN countries and South Korea, as well as aftermarket service rights in these regions. These licenses are valid for 15 years, with total licensing fees of US$28 million. GY owns and maintains the Chinese trademark registrations of the principal marks associated with the “Yuchai” name. Yuchai has entered into trademark license agreements with GY according to which Yuchai has the right to use and sub-license its branch, subsidiaries and joint ventures to use these trademarks. Yuchai believes that the “Yuchai” brand and logo is well recognized as a quality brand in China. Sales, Marketing and Services Sales and Marketing The majority of Yuchai’s engines are sold directly to OEMs and distributors from its primary manufacturing facilities in Yulin City. This centralized model is supported by a network of regional offices in major geographic regions in China. To support its customer base, Yuchai provides technical assistance that includes the dispatch of engineers to provide on-site support and troubleshooting for OEM partners. As of December 31, 2025, Yuchai’s sales and marketing workforce consisted of 945 employees, the significant majority of whom are located in China to facilitate market coverage and customer responsiveness. China-based OEMs that integrate Yuchai’s engines into their equipment have expanded their sales in overseas markets in recent years. This has led to an increase in on-road vehicles and off-road machinery powered by Yuchai products in overseas markets. We estimate that over one-quarter of Yuchai products sold in the domestic China market were integrated into products sold by China-based OEMs in overseas markets in 2025. To build on this global momentum, Yuchai has increased its marketing efforts in overseas markets. Yuchai has also expanded its service capabilities internationally to provide after-sales and technical support for Yuchai-powered products in overseas markets and promote reliability for end users globally. 39 Table of Contents A significant portion of our total sales is attributable to our largest customers. In 2025, our sales to our top five customers accounted for 35.5% of our total revenue. Our top customer is a leading automobile manufacturer group in China. In 2025, sales to our top customer as a group accounted for 17.1% of our total revenue. See “Item 4. Information on the Company — B. Business Overview — Competition.” As part of its credit procedures to control and manage its trade receivables, Yuchai may hold shipments for delivery if customers’ credit positions are not satisfactory or if customers have not made payments for earlier deliveries. There can be no assurance that such credit-controlling measures will successfully control Yuchai’s trade receivables balance, or that they will not adversely affect the future purchasing decisions of Yuchai’s customers. As of December 31, 2025, Yuchai had net trade and bills receivables of RMB 11.0 billion (US$1.6 billion), representing 43.7% of our consolidated current assets. Yuchai employs a multifaceted approach for marketing, including national and international trade exhibitions, digital media campaigns, and targeted advertisements in industry publications. Yuchai also leverages participation in high-profile events to promote brand awareness. For instance, in 2021, Yuchai introduced its IE-Power smart powertrain system at the China International Agricultural Machinery Exhibition to highlight its innovation in heavy-duty agricultural sector. In 2022, Yuchai’s power generator sets, including a number of 1100kW high-horsepower units, were installed to provide power for the facilities and athlete quarters during the Qatar World Cup. In February 2025, Yuchai provided comprehensive technical support for the 9th Asian Winter Games in Harbin, China, assuming responsibility for the seamless operation of nearly 1,000 event service vehicles equipped with YCK08 and YCS06 engines. In recent years, Yuchai, through its Annual Partner Conference held in Yulin, has engaged with key stakeholders to facilitate strategic collaboration, share operational updates, and strengthen relationships with its suppliers, distribution partners and OEMs. Export Sales Most of Yuchai’s products that are exported outside of China are sold indirectly through third-party distributors who purchase them from Yuchai and resell them to end-users in subsequent and separate transactions. Yuchai exports a very small percentage of its products directly outside China. In 2025, Yuchai’s direct export revenue was RMB 391.0 million, representing 1.6% of its total revenue, compared to RMB 301.4 million, representing 1.6% of total revenue in 2024, and RMB 129.1 million, representing 0.7% of total revenue in 2023. Customer Service We are committed to building a professional customer service team and standardized customer service processes to provide high-quality services to our customers and the end users of our OEM customers. Yuchai has established a dedicated after-sales service team, providing a comprehensive after-sales service system that includes technical support, product commissioning, repair and maintenance, user operation and maintenance training and skills-enhancement training. Yuchai’s after-sales service team is primarily responsible for receiving and addressing customer complaints, conducting product diagnosis and providing after-sales maintenance and technical support. Yuchai has an extensive network of authorized service stations, providing comprehensive after-sales support with over 6,000 domestic service stations across and more than 500 authorized service stations overseas. Yuchai’s products are covered by a warranty policy under which the costs of any warranty-related services or repairs are borne by Yuchai and all non-warranty activities are charged to customers. In relation to its products which are under warranty cover, Yuchai’s authorized service stations perform inspections and repairs on its products free of charge according to related warranty policy, to its customers or other end users, and subsequently report and settle the corresponding costs (including the service fees of the authorized service stations) on its customer relationship (CRM) system with such costs borne by Yuchai. Upon expiry of the warranty, our authorized service stations can continue to serve our customers or other end users with the costs borne by the customers or other end users. Competition The industry in which we operate is highly competitive and concentrated, and we face intense competition across our product types. We believe that we compete with our competitors for customers and market share on the basis of various factors, including brand recognition, the performance, quality, and reliability of our products, R&D capability, products’ compliance with emission standards, price, scale network, and after-sales service. Yuchai believes that its engines are highly regarded by on-road and off-road OEMs and consumers for leading performance and reliability. In addition, Yuchai believes that its nationwide network of authorized service stations and repair training centers in China provides a competitive advantage in after-sales support. 40 Table of Contents We compete primarily with major and well-established domestic Chinese and foreign competitors across each of our business and product segments. In certain markets and product categories, our competitors include our customers and their affiliates. In 2025, our sales to our top five customers accounted for 35.5% of our total revenue, with our top customer being a leading automobile manufacturer group in China that also competes with us. Some of Yuchai’s competitors have formed joint ventures with, or have technology assistance arrangements with, international diesel engine manufacturers or engine design consulting firms, and use foreign technology that is more advanced than our technology. We expect competition to intensify as a result of, among other things, improvements in competitors’ products, increased production capacity of competitors, and aggressive pricing strategies. Production capacity in the diesel engine industry has increased over the years, which has further intensified competition. See “Item 3. Key Information — D. Risk Factors — Risks Related to Our Business and Industry — Competition from other diesel engine manufacturers may adversely affect our financial condition, results of operations, business or prospects.” The ongoing development of the NEV market and the rapid advancement of new energy technologies may increase competitive pressures on our engine business and reduce demand for traditional diesel engine products. See “Item 3. Key Information — D. Risk Factors — China’s vehicle and machinery industries are increasing their momentum to new energy applications. This may lead to a decrease in demand for our engines, affecting our business volume and profitability.” The competition landscape has become increasingly challenging in recent years amid China’s economic slowdown and a sluggish real estate market, which have dampened demand for heavy machinery. In addition, increased cost pressures stemming from suppliers facing survival challenges or even closures, lead to higher production costs for Yuchai, while intense market competition limits the ability for Yuchai to adjust sales prices accordingly. See “Item 3. Key Information — D. Risk Factors — Risks Related to Our Business and Industry — We are dependent on our suppliers, some of whom are our single source suppliers for the components they supply.” Joint Ventures and Strategic Alliances Yuchai has entered into a number of strategic alliances and joint ventures to support its growth strategy, expand its product offerings and strengthen its competitive position. The following is a summary of Yuchai’s key joint ventures and strategic alliances: •Y&C Engine Co., Ltd. (“Y&C”) is a 45% joint venture of Yuchai established in August 2009 with Jirui United Heavy Industry Co., Ltd. (a joint venture owned by China International Marine Containers Group Ltd, Chery Commercial Vehicle (Anhui) Co., Ltd. and other investors) and Shenzhen City Jiusi Investment Management Co., Ltd. Y&C focuses on the production of heavy-duty vehicle engines. •MTU Yuchai Power Company Limited (“MTU Yuchai Power”), established in January 2017, is a 50-50 joint venture between our subsidiary, MGP and MTU Friedrichshafen GmbH (“MTU”), a subsidiary of Rolls-Royce Power Systems, for producing the mtu Series 4000 diesel engines for power generation and oil & gas applications primarily for the China market. In 2024, MGP and MTU entered into a second phase of cooperation, expanding MTU Yuchai Power’s production and localization of the mtu Series 4000, and adding new production and sales of the mtu Series 2000 and the Yuchai branded VC series diesel engines, to meet the rapid growth in domestic and overseas power generation markets. •Guangxi Purem Yuchai Automotive Technology Co., Ltd. (“Purem Yuchai”) is a 49% joint venture of Yuchai established in December 2018 with Purem International GmbH (formerly known as Eberspaecher Exhaust Technology International GmbH) to produce and market new exhaust emission control systems for trucks, buses, farming equipment and industrial machinery. •Yuchai Simlan, Yuchai’s primary platform for new energy development, was formerly a wholly-owned subsidiary of Yuchai and has become an 87.7% owned subsidiary since February 2023 after receiving strategic investments from Nanning Industrial Investment New Energy Automobile Investment Company and another two unrelated investors. Yuchai Simlan engages in R&D activities to build new production capacity for new energy technologies, including fuel cell systems, range extenders, hybrid power and electric drive systems. In January 2025, Yuchai Simlan further expanded its collaboration with industry partners by jointly establishing Core Power Source Technology (JiangSu) Co., Ltd., which aims to operate as an integrator of range extender hybrid systems. •Yuchai Xingshunda New Energy Technology Co., Ltd. (“Yuchai Xingshunda”), incorporated in February 2022, is 65% owned by Yuchai Simlan, with Beijing Xing Shun Da Bus Co., Ltd. holding the remaining, and focuses on the development, manufacturing and sale of fuel cell powertrain systems and core fuel cell power system components for the Beijing, Tianjin and Hebei markets. 41 Table of Contents •Suzhou Yuxing Automobile Technology Co., Ltd. (“Suzhou Yuxing”) was established in May 2022 by Yuchai’s subsidiary, Guangxi Yuchai Machinery Sales and Marketing Development Co., Ltd., (“YMMC”), together with other engine services partners, to provide vehicle performance monitoring, vehicle and engine maintenance and repairs solutions for vehicles using Yuchai engines and engines of other brands. As a result of changes in its shareholding structure, YMMC’s equity interest in Suzhou Yuxing increased from 30% to 45% in 2024, and further increased to 54% in 2025. Suzhou Yuxing has developed its customer base of large-scale fleet operators, such as logistic group companies, and has expanding its business network across China through the establishment of subsidiaries and partnerships with local strategic partners. •Guangxi Yufu Technology Co., Ltd. is a 51% subsidiary of and established in February 2025 by Yuchai’s wholly-owned subsidiary, Guangxi Yuchai Exhaust Technology Co., Ltd. with its supplier, Lotusfairy Power Technologies Corporate, for the production of intelligent urea pumps for engines. •Guangxi Yuchai Precision Mould Technology Co., Ltd was established in October 2025 by Yuchai’s wholly owned subsidiary, Guangxi Yuchai Mould Equipment Company Limited (“YMEC”) and Liuzhou Bohao Machinery Co., Ltd. (“Bohao”). YMEC holds a 63.83% equity interest and remaining 36.17% is owned by Bohao. The company focuses on the production of stamping die and stamping vehicle components for new energy vehicles. •Guangxi CIMC Yusheng Supply Chain Technology Co., Ltd. (“Yusheng”) is established in December 2025 by Yuchai’s subsidiary, YMMC, with Guangxi Southern CIMC Logistics Equipment Co., Ltd. (“CIMC”). YMMC and Guangxi CIMC hold 34% and 66% equity interests, respectively. The incorporation of Yuchai is part of Yuchai’s efforts to improve its warehousing and logistics management and operational efficiency. During the transition period prior to the completion of Yuchai’s intelligent warehousing and logistics upgrades, Yusheng will undertake Yuchai’s existing logistics activities and, thereafter, will serve as a platform to provide logistics and warehousing services to Yuchai group of entities. •Nanyue Diankong (Hengyang) Industrial Technology Company Limited is a national high-tech enterprise specializing in fuel injection systems, including common rail systems, unit pumps and mechanical pumps used in powertrain applications. In December 2025, Yuchai acquired a 27.97% equity interest in the company. The HLGE Group As of February 27, 2026, we had a 49.1% interest in the outstanding ordinary shares of HLGE. See “Item 5. Operating and Financial Review and Prospects — Business Expansion and Diversification Plan.” HLGE is listed on the Main Board of the Singapore Exchange. HLGE’s share price on the Singapore Exchange closed at S$0.455 on February 27, 2026. The core businesses of the HLGE Group are that of hospitality operations and property development. The HLGE wholly owns Copthorne Hotel Cameron Highlands (“CHCH”) in Cameron Highlands (Malaysia). CHCH is situated at the highest accessible point of Cameron Highlands, Malaysia, with 269 guest rooms and suites. Located next to the hotel, there is a Tudor-styled resort, where 51 units have been leased by the hotel from the owners of the resort for use by its guests. The resort comprises self-contained low- and high-rise apartment suites and each suite is equipped with a living room, a kitchenette and a balcony. To maintain its competitiveness, HLGE carries out renovation programs at CHCH from time to time as required. There was a loan amounting to S$93 million granted to HLGE by a wholly-owned subsidiary of our Company to refinance the outstanding zero coupon unsecured non-convertible bonds previously issued by HLGE, which matured on July 3, 2009. The loan amount was reduced to S$68 million through past repayments by HLGE and subsequently fully repaid by a portion of the proceeds from the Two Disposals in 2017. The HLGE Group may require additional funds for its core businesses and to invest in future growth opportunities. There is no assurance that the HLGE Group would be able to generate sufficient internal funds to finance its growth plans or identify and complete any potential merger and acquisition opportunities to grow its earnings base. Accordingly, the HLGE Group may, depending on the cash flow requirements and financial condition, need to raise additional funds by issuing equity or a combination of equity and debt or by entering into strategic relationships or through other arrangements. Any additional equity financing by HLGE may dilute our equity interests in HLGE. Any debt financing may contain restrictive covenants with respect to dividends, future capital raising and other financial and operational matters. Failure to obtain sufficient funds to finance its growth plans may adversely affect the HLGE Group’s business, financial performance and financial position. For more information on risks relating to our investment in HLGE, see “Item 3. Key Information — D. Risk Factors — Risks Related to Our Business and Industry — The HLGE Group’s hotel ownership and management business may be adversely affected by risks inherent in the hotel industry.” 42 Table of Contents C.Organizational Structure The following chart illustrates the organizational structure of the Company and Yuchai as of February 27, 2026 and is based on information generally known to the Company or otherwise disclosed in filings made with the SEC (see also “Item 7. Major Shareholders and Related Party Transactions — A. Major Shareholders”). This chart depicts the Company’s significant subsidiaries only. See Exhibit 8.1 for more information on the particulars of the Company’s subsidiaries. 43 Table of Contents D. Property, Plant and Equipment Yuchai’s headquarters and primary manufacturing facilities are located in Yulin City in the Guangxi Zhuang Autonomous Region. Yuchai has the right to use approximately two million square meters of land, which is used primarily for production and employee housing. The principal production land area currently occupies approximately 1.8 million square meters, including the production factories and warehouses for all light-, medium- and heavy-duty engine models, a natural gas testing facility, a high horse power marine diesel engine and power generation engine plant, foundries, and various testing and supporting facilities. Yuchai also has production and assembly facilities for new energy products in Nanning, Guangxi Zhuang Autonomous Region, and Wuxi in Jiangsu Province. In addition, Yuchai leases a number of regional sales offices in China. For the year ended December 31, 2023, 2024 and 2025, the total production capacity of Yuchai in Yulin City, Guangxi Zhuang Autonomous Region, was approximately 633,000 units each year, based on a 2.0 shift five-day week at 80% utilization rate. Yuchai performs periodic maintenance and upgrading of production facilities. Yuchai also commits a significant portion of its annual capital expenditure for maintenance and upgrading to meet safety and production requirements. Yuchai is potentially exposed to varying environmental or natural disaster risks and could experience business interruptions, damage to its facilities and loss of life, all of which could have a material adverse effect on Yuchai’s business, financial condition and results of operations. See “— B. Business Overview — Products and Key Product Development — Yuchai — Production.” E.Governance, Operation and Dissolution of Yuchai Governance, operation and dissolution of Yuchai are governed by the PRC Foreign Investment Law, or the FIL, the Company Law of the People’s Republic of China which was initially promulgated on December 29, 1993 and other related laws and regulations, as well as by Yuchai’s Articles of Association. On December 29, 2023, the Standing Committee of the National People’s Congress further amended the Company Law, and this amendment mainly included the improvement of a company’s establishment and exit system, the optimization of a company’s organization, the improvement of a company’s capital system, the reinforcement of the responsibilities of controlling shareholders and management personnel, and the enhancement of a company’s social responsibility, etc. This amendment took effect on July 1, 2024. Yuchai is subject to the relevant PRC labor laws and regulations with respect to labor management, which is overseen by the Ministry of Human Resources and Social Security. In accordance with these laws and regulations, management may hire and discharge employees and make other determinations with respect to wages, welfare, insurances and employee discipline. PRC laws and regulations require that before any company, including an FIE such as Yuchai, distributes profits, it must: (i) satisfy all tax liabilities; (ii) recover losses in previous years; and (iii) make contributions to statutory reserve fund in an amount equal to at least 10% of net income for the year determined in accordance with generally accepted accounting principles in China, or PRC GAAP. However, the allocation of statutory reserve fund will not be further required once the accumulated amount of such fund reaches 50% of the registered capital of Yuchai. Yuchai was previously a Sino-foreign joint stock company and was subject to the laws and regulations relating to joint stock limited liability companies and Sino-foreign joint venture companies in China, including the Sino-Foreign Equity Joint Venture Law. On March 15, 2019, the FIL was adopted. Upon its effectiveness on January 1, 2020, the Sino-Foreign Equity Joint Venture Law, the Wholly Foreign Owned Enterprise Law and the Sino-Foreign Cooperative Joint Venture Law, together with their implementation rules and ancillary regulations, were repealed and the FIL became the legal foundation regulating FIEs. The FIL grants national treatment to FIEs, except for those FIEs that operate in industries specified as either “restricted” or “prohibited” from foreign investment in a “negative list”. Yuchai is an FIE governed by the FIL and related implementation rules. See also “Item 3. Key Information — D. Risk Factors — General Risk Factor — Uncertainties in the interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us.” Pursuant to Chinese law and Yuchai’s Articles of Association, Yuchai may be dissolved upon the occurrence of certain events, such as force majeure, severe losses, inability to obtain necessary supplies and other events that render Yuchai unable to continue its operations. Upon dissolution, Yuchai will form a liquidation committee. Final dissolution is subject to government review and approval. 44 Table of Contents During 2003, we believe affiliates of the GY Group caused various Chinese government agencies to raise allegations of irregularities regarding the status of our ownership of and rights of control over Yuchai, which we believe was intended to try to limit our rights to exercise control over Yuchai. We further believe that such allegations were based on an inaccurate understanding of the structure of our ownership of Yuchai. We also believe that Yuchai’s ownership structure was validly approved by the relevant Chinese authorities, and that the shares of Yuchai held by our six wholly-owned subsidiaries are legally and validly held under Chinese law. We obtained legal opinions from two Chinese law firms confirming these matters (see the reports on Form 6-K filed by the Company with the SEC on April 1, 2005). We also took steps to communicate to the relevant Chinese government agencies the reasons for our position with respect to these matters. We implemented the July 2003 Agreement, the Reorganization Agreement, as amended, and the Cooperation Agreement to resolve the issues raised by the various Chinese governmental agencies relating to our share ownership in Yuchai and the continued corporate governance and other difficulties which we have had from time to time with respect to Yuchai. Based upon the above-mentioned legal opinions, we believe that in the event of a future dispute with the Chinese stakeholders at Yuchai, we expect to pursue as appropriate legal remedies in appropriate jurisdictions to seek to enforce our legal rights as the majority shareholder with a controlling financial interest in Yuchai to protect our investment for our benefit and the benefit of our shareholders. See also “Item 3. Key Information — D. Risk Factors.” F.Environmental Matters Yuchai expects that environmental standards and their enforcement in China will, as in many other countries, become more stringent over time, especially as technical advances make achievement of higher standards feasible. On January 18, 2016, the Ministry of Industry and Information Technology, and the Ministry of Environmental Protection required that all light-duty petrol vehicles, light-duty diesel buses, and heavy-duty diesel vehicles (for the purposes of public transportation, environmental sanitation and postal services) must comply with National V emission standards from January 1, 2017. All heavy- and light-duty diesel vehicles nationwide were required to comply with National V emission standards from July 1, 2017 and January 1, 2018, respectively. In June 2018, the MEE announced that all diesel powered heavy-duty vehicles must comply with the National VI emission standards in different phases: (a) natural gas engines driven heavy-duty vehicles are required to comply with the National VIa emission standards from July 1, 2019, and the National VIb emission standards from January 1, 2021; (b) diesel engine driven municipal vehicles are required to comply with the National VIa emission standards from July 1, 2020, and all diesel driven heavy-duty vehicles are to comply with the National VIa emission standards from July 1, 2021; and (c) all diesel driven heavy-duty vehicles are required to comply with the National VIb emission standards from July 1, 2023. In December 2020, the MEE announced the approval of Tier-4 emission standards and any off-road machinery (below 560 kW) that does not comply with the Tier-4 emission standards is prohibited for production, import and selling in China from December 2022. We are subject to Chinese national and local environmental protection regulations, which currently impose environmental protection tax for the discharge of waste substances, require the payment of fines for pollution, and provide for the closure of any facility that fails to comply with orders requiring us to cease or improve upon certain activities causing environmental damage. Due to the nature of our business, we produce certain amounts of waste water, gas and solid waste materials during the course of our production. Yuchai has set up a sewage disposal system that meets national environmental discharge standards to process polluted water generated during production. In accordance with applicable regulations, sewage processing data and results of sewage treatment will be uploaded in real time to an online platform operated by the Ecology and Environment Department of the Guangxi Zhuang Autonomous Region. Polluted water will only be discharged upon confirmation that it meets the national standards. Yuchai delivers solid waste products to qualified third-party waste disposal sites for disposal and makes payments in respect thereof. For recyclable waste such as foundry sand, third-party disposal sites with qualification would be engaged for recycling treatment to reduce waste of resources. In addition, Yuchai has also built treatment and filter systems for dust, fumes, panting and noise, respectively, to reduce the pollution resulting from Yuchai’s production. We believe our environmental protection facilities and systems are adequate for us to comply with the existing national, provincial and local environmental protection regulations. However, Chinese national, provincial or local authorities may impose additional or more stringent regulations which would require additional expenditure on environmental matters or changes in our processes or systems. See “Item 3. Key Information — D. Risk Factors — Risk Related to our Business and Industry — We are subject to increasingly stringent policies and regulations related to the environment, climate change, and employee health and safety.”