AutoBeta(AutoBeta.net)08/17 Report--

Affected by the new crown epidemic and the cold current of the automobile market, the sales volume of the national automobile market has been seriously affected, even Geely Automobile, as the domestic independent "leader". According to Geely Automobile's latest performance report, the company's revenue in the first half of 2020 was 36.819 billion yuan, down 22.6% from 47.558 billion yuan in the same period last year; net profit in the first half of the year was 2.3 billion yuan, down 43% year-on-year.

It is worth noting that this is Geely's second year of decline after its first decline in 2019. In 2018, Geely Automobile achieved an increase in overall sales volume and profit margin during the year, and both annual revenue and net profit increased. However, affected by the market, Geely's performance began to decline in 2019, with net profit falling by 40% in the first half of 2019 and narrowing to 35% as it warmed up in the second half of 2019.

For Geely this year's performance decline expansion, sales are undoubtedly an important factor. In the first half of 2020, Geely Group's cumulative sales volume was 530,400 vehicles, down 19% year-on-year, achieving only 37.6% of this year's sales target of 1.41 million vehicles. Due to lower-than-expected sales and market uncertainty, Geely decided to cut its original full-year sales target by 6% from 1.41 million units to 1.32 million units.

This is also Geely Automobile's sales target lowered again due to market influence after 2019. Last year, Geely Automobile lowered its original annual sales target by 10% from 1.51 million vehicles to 1.36 million vehicles, but finally achieved the target with a small gap.

Although the sales target of the Group this year is 40,000 units lower than that of the previous year, there is a double-digit decline in the first half of the year, which puts Geely's full-year sales under great pressure.

According to Geely's announcement, the decline in revenue in the first half of the year was mainly due to the impact of the COVID-19 epidemic to lower sales volume and production disruption caused by partial closure of most parts of China in early 2020. At the same time, the impact of the Group on overseas markets is more obvious. In the first half of the year, Geely Group's export volume dropped by 49% to 19573 vehicles.

However, the year-on-year decline of 19% still outperformed the overall performance of the market, while China's automobile market has great development space and potential. With a series of favorable policies of the state and local governments, the vitality of the automobile market has been stimulated. Since April, the market sales volume has continued to grow positively. Geely increased by 20% and 21% year-on-year in May and June, and the recovery trend is good.

In the first half of the year, Geely Automobile launched ICON, Link05 and Haoyue three new cars; in the second half of the year, there are also Link06, Geometry C, Geely Preface and other new cars launched, new products may help to improve Geely brand and sales.

As for the domestic market in the second half of the year, Changan Independent and Great Wall brands among the independent brands achieved a strong growth trend in July, among which Changan Independent brand sales reached 123,500 vehicles, up 50% year-on-year, exceeding Geely's July sales of 105,200 vehicles, which increased only 15% year-on-year in July, among which LinkedIn brand increased by 78%; Although the sales volume of Great Wall Motor is lower than the former, it also achieved a year-on-year growth of 29.8% in July, so the competition in the independent brand market will become more distant, and Geely, as a "leading" automobile enterprise, will still face great challenges in the second half of the year.

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