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Recently, FAW car Co., Ltd. issued a performance forecast for 2019, which showed that the net profit of shareholders belonging to listed companies in 2019 was 36 million yuan to 54 million yuan, down 73.45% and 82.30% from the same period last year. FAW cars said in the preview that due to the decline in the domestic passenger car market, the switching between the fifth and sixth countries, the rise in precious metals market prices, the rise in the exchange rate of the yen and the replacement of new and old models, the company's product gross profit margin and other financial indicators decreased.

According to the third-quarter results released by FAW cars on November 31, 2019, the total operating income of FAW cars in the first three quarters of 2019 was 17.292 billion yuan, down 6.95% from the same period last year. The net profit belonging to shareholders of listed companies was a loss of 267 million yuan, down 297.33% from the same period last year.

The company expects a net profit of 36 million yuan to 54 million yuan in 2019, compared with a loss of 267 million yuan in the first three quarters, that is to say, a net profit of more than 300 million yuan in the fourth quarter.

On October 15, 2019, FAW received a subsidy of RMB 100 million from Changchun Automobile Economic and technological Development Zone, which was specially used for FAW Pentium brand research and development and independent innovation projects.

FAW car issued two announcements on December 11, 2019, the company will hold assets located in Changchun Economic Development District for public listing transfer, the listing price is 65 million yuan, and the final transaction is 81.2 million yuan, the transferee is Changchun Zhisheng stamping Die Co., Ltd. the transaction is expected to increase the company's profit by 57 million yuan in 2019. In addition, the company plans to dispose of the property and transfer it to FAW Asset Management Co., Ltd. (FAW assets) at 75.0481 million yuan. The transaction is expected to increase the company's profit by 48 million yuan in 2019. The two deals are expected to increase the company's profits in 2019 to a total of 105 million yuan.

Through the transfer of assets and relying on government subsidies to achieve profit growth, the current development of FAW cars is not optimistic.

At present, FAW cars have two major passenger car brands, namely FAW Pentium and FAW Mazda. According to the data, FAW Pentium sold 120500 vehicles in 2019, up 33.4% from the same period last year, while FAW Mazda sold 227750 vehicles in 2019, down 16.37% from the same period last year.

In terms of FAW Pentium, the Pentium T77 was officially listed in Guangzhou Auto Show in November 2018, Pentium T33 in August 2019 and Pentium T99 in November 2019, the new Pentium brand achieved rapid sales growth, and the Pentium T series began to take shape. In the next 3 years, the new Pentium brand will launch 9 new products one after another, of which the proportion of new energy products will exceed 50%, building a new product layout.

FAW Mazda mainly relies on Unksera, CX-4, Atez and CX-5 to maintain stable sales, of which Onksera sold 98218 vehicles in 2019, CX-4 sold 49419, Atz sold 41950, and CX-5 ranked last with 35620.

Since 2018, the overall sales of domestic passenger cars have declined seriously, the pressure of competition in the automobile market is great, and the performance of FAW cars in the market is not good. Although FAW Pentium achieves sales growth, it is impossible to achieve overall profit growth by relying on a single brand. For FAW cars, how to get out of the predicament and real profit growth has become one of the company's main tasks.

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