Cars

China auto sales figures strong through H1

(China Daily/Agencies)
Updated: 2010-08-05 10:16

BEIJING - Chinese automakers are poised to post strong earnings for the first half of the year, according to preliminary statements submitted to the Shanghai Stock Exchange.

Industry analysts said the same robust growth would not continue in the second half.

Shanghai-listed SAIC Motor Corp, the nation's largest automaker, generated a net profit of 1.44 billion yuan ($213 million) in the first half of this year, tripling figures from a year earlier. SAIC sold 1.8 million cars, up 44 percent from the same period in 2009.

Other listed companies like FAW Car Co, Chongqing Automobile Co and Dongfeng Motor Group Co also estimate over 100 percent growth year-on-year.

China surpassed the United States to become the world's largest auto consumer last year, with 13.64 million units sold, a 46.15 percent increase from 2008. The sales momentum maintained in the first half of this year - with 9 million units sold - is up 47 percent from a year earlier.

However, the trend is not likely to continue analysts said after sales started to slip last month. According to China Automotive Technology and Research Center, automobile sales in China jumped 15.4 percent last month compared with the same period last year.

Xu Minfeng, an analyst with Central China Securities Holding Co Ltd, predicted a drop in retail auto sales in the next half, adding the slowdown may not impact manufacturer earnings because of recent decreases in raw material prices including steel. Cao He, an analyst from China Minzu Securities said, "Sales are expected to decrease (in the coming months), but annual revenue across the industry will still be positive, because of strong sales in the first half."

Related readings:  China auto sales, output to exceed 15m in 2010  China's auto sales up 17% year-on-year in July  China's auto prices may fall steadily: NDRC  Dealers offer auto discounts

Meanwhile, China may invest more than 100 billion yuan ($15 billion) in alternative-energy vehicles during the next 10 years to boost the industry, the Shanghai Securities News said on Wednesday.

The spending is included in a draft plan for 2011 to 2020 that the Ministry of Industry and Information Technology may submit this month to the State Council for approval, after seeking feedback from other ministries, the newspaper reported on Wednesday, without saying where it got the information.

SAIC slid 3.5 percent to 15.07 yuan on Wednesday. Chongqing Changan fell 3.1 percent. Shares of Anhui Jianghuai Automobile Co, with a joint venture to develop alternative-energy cars in Tianjin, fell 0.9 percent to 8.78 yuan.

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