Growth declines at largest auto firm
By Jin Jing |
August 30, 2011, Tuesday
|
Print Edition
Print Edition
SHARES in SAIC Motor fell 2.6 percent yesterday after its net profit growth slowed during the first half.
But analysts said the nation's largest auto group nonetheless leads the overall industry after the withdrawal of government incentives resulted in slower vehicle sales.
SAIC said net income was 8.6 billion yuan (US$1.3 billion) during the first six months of this year, 46 percent higher than the same period last year compared with a 306 percent first-half surge in 2010.
Shanghai-based SAIC, which partners General Motors and Volkswagen to make Buick and Passat saloon cars, boosted sales by 13 percent to 2 million units in the first six months, four times the 3.4 percent increase for China's overall auto market.
Most sales were contributed by its flagship venture Shanghai GM and Shanghai VW, which each reported sales growth of 28 percent. Sales of its own-brand Roewe and MG totaled 80,395 units, almost unchanged from a year earlier as Chinese brands are more sensitive to the government incentives that were phased out this year.
Zuo Tao, of Guosen Securities, said: "Sales of its own-brand vehicles have fallen noticeably since the second quarter, lagging behind the overall Chinese-branded car market. But as own brands also aim at a higher market position with high-quality products, business return will gradually emerge in the mid to long term."
Chen Zhixin, vice president of SAIC Motor, earlier told reporters SAIC will be investing more than 20 billion yuan in developing own-brand vehicles during the 12th Five-Year Plan ending 2015, pushing total investment in own-brand vehicles to 45 billion yuan.
The company aims to sell 230,000 Roewe and MG vehicles this year.
But analysts said the nation's largest auto group nonetheless leads the overall industry after the withdrawal of government incentives resulted in slower vehicle sales.
SAIC said net income was 8.6 billion yuan (US$1.3 billion) during the first six months of this year, 46 percent higher than the same period last year compared with a 306 percent first-half surge in 2010.
Shanghai-based SAIC, which partners General Motors and Volkswagen to make Buick and Passat saloon cars, boosted sales by 13 percent to 2 million units in the first six months, four times the 3.4 percent increase for China's overall auto market.
Most sales were contributed by its flagship venture Shanghai GM and Shanghai VW, which each reported sales growth of 28 percent. Sales of its own-brand Roewe and MG totaled 80,395 units, almost unchanged from a year earlier as Chinese brands are more sensitive to the government incentives that were phased out this year.
Zuo Tao, of Guosen Securities, said: "Sales of its own-brand vehicles have fallen noticeably since the second quarter, lagging behind the overall Chinese-branded car market. But as own brands also aim at a higher market position with high-quality products, business return will gradually emerge in the mid to long term."
Chen Zhixin, vice president of SAIC Motor, earlier told reporters SAIC will be investing more than 20 billion yuan in developing own-brand vehicles during the 12th Five-Year Plan ending 2015, pushing total investment in own-brand vehicles to 45 billion yuan.
The company aims to sell 230,000 Roewe and MG vehicles this year.
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