by Plan awards some 3 million shares, about 1% of the company, to members of its board of directors, middle managers and managers in the United States
CHANGZHOU, China — MotoMotion China has proposed an incentive plan that would grant approximately 3 million shares in the company to members of its board of directors, middle managers and managers in the United States. The restricted stock represents about 1% of the company’s value, and it is expected to cost about $7 million in share-based compensation over the five years of its proposed timeline.
While issuing Type II restricted stock is customary in China, or has been since China’s regulators cleared the way for it in 2018, the messaging of it here is intriguing. Going through a half-dozen or so filings translated from Mandarin into English using Adobe Express, I read about a proposal that both identifies revenue and profit targets and at the same time describes the industry in fairly grim terms.
The proposal seems to say, “Hey, we’re going to share profits and incent people to really work hard because . . . this industry is in big trouble because of tariffs, currency instability, and challenging fundamentals at retail. We’re navigating some rough chop here, so we need all hands on deck committed to riding this out.”
Authored by the company’s board, the plan states as context that the Chinese furniture industry overall has seen profits plummet more than 52% because of soft U.S. demand, the bite of tariffs and currency headwinds.
Keeping good people
While prioritizing retention, the company also seems to be favoring share-based compensation because it is cheaper on the cash flow statement than raises would be. But, the mechanics of the plan (the granting price of the shares, the 60-month cap, exclusion of large shareholders and the controlling family, and a Remuneration Committee overseeing the process) all read as though they came straight out of the standard incentive plan playbook for Chinese publics as determined by the Shenzhen Stock Exchange.
MotoMotion shareholders will vote on the proposal on Oct. 9.
If I’m doing my math correctly, only 9.5% of the shares go to the five named top executives, which means more than 90% would go to a pool of 180 midlevel managers and technical staff. This is a bigger share for the “rank-and-file” than a lot of incentive plans call for, a distribution that adds credence to the stated purpose for setting it up — retention.
Also worth noting is the mention in the proposal of 32 foreign nationals in line to benefit. Interesting here is not that the plan includes them but that the proposal of the plan explicitly cites the number as justification for the plan. A lot of MotoMotion middle managers in Canada and the United States are probably smiling right now.
The plan share price is set at 17.99 RMB per share, or about $2.68 at Tuesday’s exchange rate, and the plan is slated to run for a maximum of five years from the date shares are first issued, according to the company’s filings with the Shenzhen Stock Exchange.
Five named executives will collectively receive 270,000 shares: Board Secretary and Deputy General Manager Zhang Congying, CFO Wang Junbao, Deputy General Manager Gao Hai, and directors Ding Li and Wang Xuerong. The remaining 90.5%, or about 2.6 million shares, is earmarked for 180 employees, including 148 Chinese midlevel managers and other staff, plus 32 foreign nationals the company says are “core technical or business personnel” who have helped drive its international expansion, the filing states.
Rough headwinds
As we have previously reported, the focus of MotoMotion is partnering with Top 100 U.S. retailers and moving to the foreground in terms of retail display with branded in-store galleries. And yet the U.S. market is sputtering. Citing U.S. Census Bureau figures that show overall retail sales growing only modestly in June, the proposal also notes that home furnishings stores lagged well behind the broader retail sector.
Layered on top of this softness at retail for MotoMotion is currency exposure. The RMB (or yuan) appreciated roughly 3.1% against the U.S. dollar in the first half of 2026, which erodes the value of dollar-denominated export revenue once those sales are converted back home. The proposal singles out U.S. tariff policy shifts and RMB-US dollar currency volatility as the “two core factors” shaping the company’s operations at the moment.
The proposal states that MotoMotion chose companywide revenue and net profit as its performance benchmarks for the next three years because they most directly capture business expansion and profitability. The board argues the resulting boost to management motivation and operational efficiency should outweigh the incentive plan’s expense.
MotoMotion’s total revenue dipped 7% year over year to approximately $233 million for the first six months this year, while net profits dropped in large part because of currency valuations. The Chinese yuan appreciated roughly 3% against the U.S. dollar during those first six months, sending export revenues down by approximately $11 million, according to MotoMotion’s filings with the stock exchange. (All of the dollar amounts here were converted by Gemini using current dollars, so they are approximations.)
Products bound for the U.S. during this year’s first half were subject to a 25% tariff, but MotoMotion reports that it elected to eat a portion of the tariff burden to safeguard long-term retail partnerships. This dented first-half profits by more than $5 million. For comparison, in a down year for Chinese exports to the U.S. in 2025, MotoMotion reported total sales of 3.4 billion yuan, or about $470 million, according to its public filings. That 2025 total was up nearly a third over 2024’s $373 million and nearly 80% over 2023’s $280 million.
The day after the raft of filings related to the plan, the company convened its “third extraordinary shareholders’ meeting” of the year to approve previously proposed capital allocations, including those earmarked for the new Cambodian production facilities. Those allocations and the first six-month financial reporting were nearly unanimously approved, according to a separate set of filings with the Shenzen Stock Exchange made Tuesday.
