AutoBeta(AutoBeta.net)02/17 Report--

Over the past month or so, a set of data showing a decline in China's auto industry in 2018 has become the focus of the topic. China's automobile production and sales in 2018 were 27.809 million and 28.081 million respectively, down 4.2 per cent and 2.8 per cent respectively compared with the same period last year, the first annual decline in 28 years.

In this environment, from the 14 listed vehicle companies that have announced their 2018 performance forecasts, it is found that only 4 have achieved year-on-year growth, while the remaining 10 have declined, or even dropped sharply. In addition, a total of three car companies reported operating losses. A number of car companies have said that the decline in performance is related to falling sales and increased competition in the market.

Cui Dongshu, secretary-general of the China Joint passenger car Association, believes that the decline in the car market in 2018 is mainly due to a sharp decline in independent brands, especially the recent decline in most independent retail data, indicating a lack of demand from mass consumers.

Only four companies have increased their performance

Among the whole vehicle enterprises in China, SAIC Group can be called profit machine, and its companies include SAIC GM, SAIC GM Wuling, SAIC Volkswagen, SAIC passenger cars and so on, which all play a certain market leading role in their respective market segments. SAIC's overall sales exceeded 7 million vehicles in 2018, up 1.8 per cent from a year earlier.

SAIC expects net profit of about 36 billion yuan in 2018, an increase of about 4.6 per cent compared with the same period last year.

By contrast, the other three profitable car companies are relatively weak. Dongfeng Automobile performance forecast shows that net profit in 2018 increased by 345 million yuan to 380 million yuan compared with the same period last year, an increase of 171% to 189% compared with the same period last year, while BAIC Blue Valley (BAIC New Energy) performance forecast shows that the company expects net profit of 139 million yuan to 164 million yuan in 2018, an increase of 134.68% to 176.76%. These two car companies are also the car companies with the largest increase in net profit.

While FAW Xiali relies on selling 15% of its shares in FAW Toyota to achieve profit growth, the actual situation is worrying.

Profits of 10 car companies have declined

Changan Automobile can also be regarded as a large domestic independent and joint venture brand enterprise, but it is also not immune from the dilemma of a sharp drop in profits. Chang'an expects to make a net profit of only 500 million yuan to 750 million yuan in 2018, down about 90% from a year earlier. The decline in performance is mainly due to the reduced investment income of the joint venture.

In 2018, the cumulative sales of all Changan automobile brands were 2.1378 million, down 25.58% from the same period last year, and almost all brands, whether independent or joint venture, fell. Changan Ford, Changan Mazda sales are weak, Changan Suzuki due to long-term losses, Japan's Suzuki finally chose to quit.

BYD's sales of new energy vehicles rose sharply last year, leading to a rapid recovery of the group's profits, while the fuel vehicle business performed smoothly, and BYD expects profits to fall by about 30% in the end because there are still losses in other businesses.

Similarly, there are a number of car companies with a serious decline in net profits. Jinlong Motor has dropped nearly 70%, Jiangling Motor has dropped 87% compared with the same period last year, and Jianghuai and Ankai have also dropped greatly. Statistics show that among these companies with pre-reduced performance, increased losses, and first losses, the average decline is as high as 76%.

Three car companies are losing money

Of the 14 vehicle companies that announced performance forecasts, three suffered losses, namely Jianghuai Automobile, Ankai Automobile and Haima Automobile. Jianghuai and Haima are also familiar independent brands in the field of passenger cars.

Among them, Jianghuai Motor is expected to lose about 770 million yuan in 2018. Jianghuai Motors said that the main reason for the performance loss was that due to the impact of the industry recession, the company sold 462400 vehicles and chassis in 2018, down 9.48% from the same period last year, including a significant decline in passenger car and bus sales and a decline in the company's overall profitability.

Seahorse Motor is the vehicle company with the largest loss, with an estimated loss of 12-1.8 billion yuan, mainly due to the sharp decline in car production and sales compared with the same period last year, the implementation of the sixth national emission regulations, and the loss of vehicle impairment in inventory.

Cui Dongshu said: "the decline in the car market in 2018 is mainly a sharp decline in independent brands." A number of independent car companies in the car market environment in the doldrums, a sharp drop in sales profits. In 2019, the differentiation of automobile enterprises will be further intensified, the stronger the strong, the weaker the market share will be gradually lost, and it is difficult to escape the fate of being eliminated by the market.

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