Jianghuai Auto estimates '08 profit down 50%

Shanghai, January 19 (Gasgoo.com) Jianghuai Automobile Co Ltd (JAC) said in the weekend it predicted its net profit would drop by more than 50 percent in 2008 due to higher costs for raw materials and labor forces.

JAC also said that consumer spending on cars has been subdued because of the current economic downturn. In 2008 China's vehicle sales growth slowed to 15.14 percent, with total sales up only by 6.7 percent year on year to 8.38 million units.

The automaker posted a group net profit for 2007 of 328.46 million yuan (US$48million), earnings per share in the year stood at 0.27 yuan.

In an effort to support homegrown automakers, the Anhui provincial government has recently granted a three years' tax preferential policy to JAC.

Late last month the company has received the 50 million yuan free grant from Hefei city, the provincial capital of Anhui, for the development of its automatic dual-clutch transmission (DCT) project.