FAW Xiali suffers deficit of over 1.2b over past two years

Gasgoo.com (Shanghai November 18) - 2014 is looking to be a very tough year for own brand manufacturers. The performances of own brand manufacturers are slipping further and further far away from their joint venture rivals, with companies such as FAW Xiali, JAC Motors, Great Wall, BYD and Haima all having suffered sharp falls in their profits.

FAW Xiali is one of the sharpest examples of this. This historic brand has suffered a combined deficit of over 1.2 billion RMB ($195.44m) over the last two years, with over half of that deficit coming from the first three quarters of 2014. According to its most recent financial report, over the first three quarters of this year FAW Xiali has suffered a net deficit of 259 million RMB ($42.19m). The figure represents a fall of 150 percent from its performance last year.

FAW Xiali's declines goes back as far as 2012, when its net profits fell 68.74 percent. FAW Xiali has attributed its poor performance to its declining brand image, lack of competitiveness of its models and falling sales of its subsidiary Tianjin FAW Toyota joint venture.

In order to help reverse this tide, the FAW Xiali Junpai D60 (pictured) was released earlier this year. Two more models are scheduled to be released next year. The manufacturer hopes that the new models will help breathe life into the brand; how successful they will be remain to be seen.