Company: SDAWW
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036086
Chunk: 122

Company: SunCar Technology Group Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 5
Chunk 122
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 are seeking to differentiate themselves, often through product
diversification. As the market gradually evolves and matures in the future, the complexity of auto eInsurance products will keep evolving
accordingly. From the demand side, firstly, as the number of vehicles increases over time, there will be more customers entering the market
with various and specific demands. Secondly, as customers increase in their knowledge of auto eInsurance, they will demand different types
of auto eInsurance to meet their diverse and specific needs. Thirdly, the fast-growing demand attributable to the significant growth on
the EV sales is expected to generate more diversified demand in the auto eInsurance agency market in the near future.

Accelerating Industry
Consolidation

With its short history relative
to in more developed countries, the professional insurance agency market in China is rather fragmented, which indicates substantial opportunities
for further growth and consolidation. Moreover, as the government continues its focus on the healthy and orderly development of the auto
eInsurance agency market through strict industry regulations, the barrier to entry will increase and the expected number of players in
the market will decrease. As a result, auto eInsurance agencies who cannot or will not pay the increasing regulatory costs, for example
because of their small scales, will likely consider exiting the market due to intensified competition, poor profitability, or burdensome
industry regulations. By contrast, the leading players with scale and experience are expected to benefit in the long run.

Technological Advancement
to Enhance Operational Efficiency

With advances in technologies
including the Internet of Things, big data, cloud computing and artificial intelligence, the adoption of technology to improve operational
efficiency becomes more ubiquitous and integrated in the value chain. As technology integration and digitalization bring customers, vehicle
manufacturers and auto eInsurance providers closer together, auto eInsurance agencies can initiate strategic alliances with vehicle manufacturers
to better take advantage of the resulting market opportunity and customer data. Ultimately, through the application of technologies, auto
eInsurance providers can develop sophisticated and customized auto eInsurance according to each individual case. Such technology trends
will likely continue in the foreseeable future.

Overview of China’s Integrated Auto Service
Market

According to the National
Bureau of Statistics of China, by the end of 2024, the total number of motor vehicles for civilian use in China reached 352.68 million,
up by 16.51 million over the previous year. Electric vehicles (“ EVs”) totaled 31.40 million, up by 10.99 million over the