AutoBeta(AutoBeta.net)08/29 Report--

On the evening of August 28, Dongfeng Automobile Group Co., Ltd. (hereinafter referred to as "Dongfeng Motor") released its interim results report for 2023. According to the financial report, the group achieved operating income of 45.677 billion yuan in the first half of the year, an increase of 2.9% over the same period last year, and the profit attributable to equity holders of the parent company was 1.27 billion yuan, down 76.9% from the same period last year.

The overall performance of the joint venture brand is lower than the market level, which directly affects the profit performance of Dongfeng Motor, which is also the main reason why Dongfeng Motor does not increase profits. It is understood that Dongfeng Motor's share of the joint venture's profits and losses during the reporting period was 1.403 billion yuan, a decrease of 3.822 billion yuan compared with the same period, of which Dongfeng Limited decreased by 1.76 billion yuan and Dongfeng Honda decreased by 1.514 billion yuan.

According to the financial report, Dongfeng car sales in the first half of 2023 were 945500, down 23.4% from the same period last year, of which 119600 new energy vehicles were sold, down 7.0% from the same period last year. Zhu Yanfeng, chairman of Dongfeng Group, said that since 2023, China's automobile market is still in the recovery stage, the operation is still under great pressure, the overall demand is still insufficient, and the trend of market segmentation is obvious.

In terms of specific brands, among the joint venture brands, Dongfeng's daily production and sales volume in the first half of the year was 335200, down 28.02% from the same period last year; GAC-Toyota was 227000, down 32.80% from the same period last year; and DPCA was 44200, down 21.56% from the same period last year. It is also difficult for independent brands. Dongfeng Liuqi sales are 58000, down 30.06% from the same period last year, while Dongfeng passenger cars are 52400, down 37.68% from the same period last year. Dongfeng Lantu alone increased by 118.54%, but sales were only 15000.

According to Automotive Industry concern, Dongfeng Nissan and Dongfeng Honda accounted for 59.46 percent of the group's total sales, while Dongfeng Liuqi and Dongfeng passenger cars accounted for only 11.67 percent. In other words, the joint venture brand is still the main source of sales of Dongfeng Motor, and the performance of the joint venture brand will directly affect the performance of Dongfeng Automobile. In the future, the growth of Dongfeng Automobile will mainly come from new energy vehicles, but the new energy brand camp dominated by Dongfeng Lantu is an embarrassing task.

Where is the way of joint venture brand? Life is hard for both Dongfeng Nissan and Dongfeng Honda.

In the era of fuel cars, Japanese cars have good brand awareness and good reputation, leather solid, durable, fuel-saving and other labels bring it a certain premium, but in the era of electric cars, these original cognitive labels have been unable to support the premium. As the later followers of electric cars, Japanese brands are no longer faced with established giants such as Volkswagen and General Motors, but Chinese brands such as BYD and Ian.

At present, Nissan's domestic models include Xuanyi, Xiaoke, Teana, Qijun, Jinke, Bluebird, Loulan and so on. Among them, Xuanyi is the main selling model of Dongfeng Nissan, and it is also the evergreen model of the joint venture compact car. Xuanyi sold a total of 158600 vehicles in the first half of the year, accounting for 53.7% of the total sales of the Dongfeng Nissan brand. The decline in Xuanyi sales also directly affected the overall performance of Dongfeng Nissan. At the same time, sales of other Dongfeng Nissan models are also worrying, including Teana and Xiaoke, which sold 39200 and 48800 respectively in the first half of the year, while models such as Bluebird, Tuda and Quetta are even more miserable.

On July 16, Dongfeng Honda officially announced that the proportion of electrification will reach more than 50% by 2025, no new fuel cars will be put into use after 2027, and more than 10 pure electric models will be launched by 2030. However, according to the current market performance, Dongfeng Honda pure electric model sales are not ideal, although Dongfeng Honda is determined to transform, but its results need to be tested.

Previously, Dongfeng Motor Group set a target of "hitting 3 million vehicles in 2023" in its 2022 results, while it sold 945500 vehicles in the first half of the year, with a target completion rate of 31.5%. It is very difficult to achieve the target.

For Dongfeng Motor, if it wants to achieve its sales target, it must rely on its own brand. On August 16, Dongfeng Motor launched the new energy strategy of Dongfeng passenger vehicles and made a major adjustment to the management system of the new energy cause of independent passenger vehicles. After the adjustment, Dongfeng Motor will integrate the management of Dongfeng Fengshen, Dongfeng e π and Dongfeng Nano. Among them, Dongfeng Fengshen will accelerate the transformation from fuel vehicles to energy-efficient vehicles, Dongfeng e π will position itself as an electric brand oriented to the mainstream market, and Dongfeng Nano will be a pure electric brand for small market segments.

Dongfeng Motor is not alone. It reflects the current "dilemma" of joint venture brands in China's auto market, including Changan Ford and Changan Mazda, which belong to Changan Automobile Group, SAIC Volkswagen and SAIC General Motors, and Guangzhou Automobile Toyota and Guangzhou Automobile Honda, which belong to GAC GROUP, have not performed very well in 2023.

The decline of joint venture brands and the head-on catch-up of independent brands have become the truest portrayal of China's automobile market, and it also reveals the awkward position of joint venture brands in the domestic market. Previously, joint venture brands have dominated the Chinese car market for more than 20 years, and Chinese car brands have no choice, but now independent brands have gradually become the target for global car companies to catch up.

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