U Power Limited (Nasdaq: UCAR) (the "Company" or "U Power"), a provider of AI-powered solutions for next-generation energy grids and intelligent transportation systems, building on its proprietary UOTTATM electric vehicle (EV) battery-swapping technology, today announced that it has signed a Memorandum of Understanding ("MOU") with Chia Tai Co., Ltd. ("Chia Tai"), Thailand's leading innovative agricultural company and the founding seed business of the Charoen Pokphand Group (CP Group), and ICBC (Thai) Leasing Co., Ltd. ("ICBC Thai"), a majority-owned subsidiary of Industrial and Commercial Bank of China Limited, specializing in vehicle and equipment financing.
Together, the three parties will co-develop and promote a drone platform to support the adoption of agricultural drones in Thailand, advancing sustainable farming practices through smart, efficient, and tech-driven solutions.
The goal of the partnership between U Power, Chia Tai, and ICBC Thai, is to accelerate the transformation of Thailand's farming sector by introducing battery-swapping-compatible drones into mainstream farming operations. These advanced drones will support a wide range of functions such as crop spraying, seeding/spreading, field assessment, and aerial monitoring and mapping, aimed at improving operational efficiency, reducing costs, and enabling more precise, data-driven farming practices. Through this collaboration, the partners seek to equip farmers with next-generation tools that can drive smarter, more sustainable agricultural production across the country.
Pursuant to the MOU, U Power will provide customized swapping and charging-enabled battery modules for dedicated agricultural drones. The Company will also take the lead in providing technical support, managing platform operations, and ensuring the security and regulatory compliance of operational data. In addition, U Power will oversee the payment platform, facilitating transparent and compliant order processing, profit distribution, as well as payment security. Leveraging insights from operational data, U Power also plans to continuously upgrade and scale the platform, enhancing performance and adaptability over time.
Chia Tai will supply the agricultural drones and provide drone-related maintenance services for deployment in various application scenarios such as farmlands and orchards in across Thailand. Chia Tai will also lead the promotion and customer acquisition efforts, supporting the commercial implementation and local operation of the drone platform. Meanwhile, ICBC Thai will offer tailored financial leasing solutions for platform users, including dealers, farm owners, agricultural service providers, and agricultural cooperatives, to enable financial compliance and support the long-term sustainability of the platform's operations.
Following the signing of the MOU, Chia Tai and U Power will also commence discussions to establish joint ventures aimed at supporting the development and expansion of the agricultural drone platform. As part of the initial phase, Chia Tai will launch pilot programs where U Power will provide test battery modules in select farms in Thailand for operational validation. Concurrently, ICBC Thai will begin designing customized financing solutions for business customers, laying the groundwork for scalable and financially accessible platform adoption.
Johnny Lee, CEO and Chairman of U Power commented, "We see strong potential to contribute to Thailand's transition toward digitalized and intelligent agriculture, especially as the country reinforces its position as the 'Kitchen of the World,' supported by government initiatives such as the AGROWTH platform which encourages investments in and use of AI, robotics, and drones. Our goal is to scale the drone application platform nationwide, supporting an industry that contributes to 8-10% of national GDP. As per Data Breach Market Research, in 2024, the Thailand agriculture robot market, which includes drones, soil sensors, harvest robots, etc., was valued at approximately $207.35 million, is projected to reach $1.3 billion by 2032, growing at a CAGR of ~30.4%. Furthermore, with the APAC agriculture drone market projected to reach nearly $49 billion by 2034, this presents significant opportunities for the company to expand beyond Thailand's domestic drone market.
We are excited to expand our scope of offerings beyond EVs to include agriculture-specialized drones in collaboration with Thailand's leading agribusiness company and a trusted financial solutions provider. At the same time, we are further strengthening our market existence in Thailand, by collaborating with energy providers, taxi operators, and transportation solution providers, all of which are integral to our vision of building a comprehensive energy replenishment ecosystem."
