AutoBeta(AutoBeta.net)03/27 Report--

Recently, SAIC released its annual results, showing that SAIC sold 5.6 million vehicles in 2020, down 10.2% from the same period last year, ranking first in domestic sales. During the reporting period, SAIC realized operating income of 742.132 billion yuan, down 12% from the same period last year, and its net profit was 20.431 billion yuan, down 20.2% from the same period last year.

The decline in revenue and profits of SAIC is related to the weakness of the joint venture. According to the financial report, the net profit of SAIC Volkswagen belonging to SAIC in 2020 was 15.489 billion yuan, down 22.65% from 20.025 billion yuan in 2019. SAIC GM's net profit in 2020 was 4.103 billion yuan, down 62.56% from 10.958 billion yuan in 2019. In other words, the net profit contribution of SAIC Volkswagen and SAIC GM in 2020 decreased by more than 10 billion yuan compared with the same period. In addition, although SAIC GM Wuling sold well last year, its main low-end market had little profit space, coupled with the impact of the epidemic on the company, resulting in a profit drop of more than 90%, with a net profit of only 140 million yuan in 2020 and 1.699 billion yuan in the same period in 2019.

The net profit of the three companies showed a large decline, the most direct reason is that the epidemic led to low sales. According to the data, total sales of SAIC-Volkswagen in 2020 were 1.5055 million, down 24.79% from the same period last year; SAIC-GM was 1.4675 million, down 8.29%; and SAIC-GM Wuling was 1, 600100, down 3.61% from the same period last year.

The epidemic led to the decline in sales of the most direct cause, and brand development is the root cause of the decline. After SAIC-Volkswagen Passat turned over in the China Insurance Research Institute, the myth of the Volkswagen brand collapsed instantly, and the reliability of its products was controversial, although it was later tested again by the China Automobile Center and the China Insurance Research Institute to restore its reputation. However, excellent results are still difficult to restore the image of SAIC-Volkswagen in the hearts of consumers.

SAIC expects sales to rebound by more than 10% this year, based on market conditions last year. SAIC said it expects to achieve full-vehicle sales of 6.17 million vehicles for the whole year, an increase of 10.2% over the same period last year, and total revenue is expected to be 830 billion yuan, an increase of nearly 12% over the same period last year. SAIC said that under favorable conditions such as the restorative growth of the global economy, China's macro policy "no sharp turn" and the relatively low year-on-year base of the car market, the domestic automobile market is expected to end its continuous decline since 2018 in 2021. Domestic vehicle demand is expected to be 26.1 million, an increase of 3.1% over the same period last year; of which 21.5 million are passenger vehicles, up 7.3% from the same period last year; and 4.6 million commercial vehicles, down 12.9% from the same period last year. Sales of new energy vehicles are expected to be about 1.7 million, up 34 per cent from a year earlier.

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