AutoBeta(AutoBeta.net)10/14 Report--

Chang 'an Automobile released its performance forecast today, predicting a net profit of 2.4 billion yuan to 2.8 billion yuan in the first three quarters, compared with a profit of 1.163 billion yuan in the same period last year. Chang 'an Automobile said that the overall performance decline of the company was mainly affected by the decline in sales.

In fact, Chang 'an Automobile has lost 2.24 billion yuan in the first half of the year, which means that the loss in the third quarter is 160 million yuan ~ 560 million yuan, and the loss range has narrowed. Chang 'an Automobile said that it mainly stems from the improvement of profit structure brought about by the optimization of product structure of Chang' an independent brand.

Changan car sales are warming up. September data shows that Chang 'an series of self-owned brand cars sold 116015 vehicles in September, including CS75 series sales of 20190 vehicles, CS35 series sales of 10400 vehicles, CS55 sales of 8634 vehicles, and Yi Dong series sales volume of 10167 vehicles. The rebound in sales volume directly drives the growth of profits.

Chang 'an Ford is still Chang' an Automobile's biggest pain point. According to the performance report, Chang 'an Ford sales fell seriously, with a loss of 777 million yuan in the first half of the year alone. At present, the decline in sales volume of Chang 'an Ford has eased, and the two major shareholders have accelerated and deepened cooperation to seek the revival of Chang' an Ford again.

Changan Ford sold 20,905 vehicles in September, down 36.7% year-on-year; cumulative sales from January to September were 128,906 vehicles, down 58% year-on-year. On September 26, Chang 'an Automobile signed a deepening cooperation agreement with Ford Motor Company and released Chang' an Ford Acceleration Plan. At least 18 new models will be launched in the next three years, and the new Ford Explorer will be made in China next year; Chang 'an Ford Research Institute will be established to accelerate product development and testing capabilities for Chinese customers.

Chang 'an Mazda sales have continued to decline since the beginning of this year, but it is also the only profitable joint venture passenger car enterprise of Chang' an Automobile. Chang 'an Mazda earned 873 million yuan in the first half of the year. Data show that Chang 'an Mazda sales volume in September was 12,829 vehicles, down 17.5% year-on-year; cumulative sales volume from January to September reached 95,845 vehicles, down 25.4% year-on-year.

Chang 'an Automobile continues to lose money, and the government subsidizes continuous blood transfusion. On October 7, Chang 'an Automobile issued an announcement that Hefei Chang' an Automobile Co., Ltd., a wholly-owned subsidiary, received 300 million yuan of subsidies for research and development of new models in Hefei High-tech Industrial Development Zone and 120.682 million yuan of fixed assets investment subsidies, totaling about 421 million yuan. Since the beginning of this year, Chang 'an Automobile has received a number of government subsidies, including Chongqing, Nanjing and Hefei governments, among which Chongqing City allocated 350 million yuan of enterprise subsidies to Chang' an Automobile in June. The government's multiple subsidies also directly bring certain performance improvement to Chang 'an Automobile.

It should be noted that the net profit of Chang 'an Automobile in 2018 was only 681 million yuan, including 2.873 billion yuan of government subsidies. The net loss of Chang' an Automobile after deducting non-recurring profits and losses was as high as 3.165 billion yuan in essence.

No matter how, the improvement of profit structure is of great help to the long-term development of Chang 'an Automobile, but it is difficult to change the situation of large losses this year, and the overall performance deterioration is also very obvious compared with last year. Zhang Baolin, chairman of Changan Automobile, said earlier that "as long as the economy does not change greatly, the profit target set this year will not change." How Changan Automobile is profitable is still very confused from the outside world.

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