JAC SUV Net Profit Falls by 40.31% in the First Half Year

Shanghai, September 4, Gasgoo - August 31, JAC released its 2017 semi-annual report, which shows operating income of JAC in the first half of 2017 is 25.313 billion yuan, a year-on-year decrease of 4.08%. Net profit of the shareholders is 345 million yuan, a year-on-year decrease of 40.31 %. And among that, there is 124 million yuan that is from the government's new energy vehicle subsidies, accounting for nearly 30% of total profits.

In addition, net profit rate of JAC in the first half year is also rapidly declining to only 1.23%, becoming the lowest net profit rate since 2009. JAC Automobile attributed the sharp decline to the bad sales of SUV, falloff of new energy vehicles subsidies as well as rise in the price of raw material prices.

In fact, the decline of JAC began in the second half of 2016, and up to now, decline in sales of passenger cars has been lasted for 8 consecutive months. According to the data of the first half year, plunge can be seen in sales of its main products, MPV and SUV.

To handle the situation, JAC has turned to official reduction to increase sales on August 15. In addition, JAC also seeks breakthrough in products. The commercial vehicle maintains a high growth.

As for new energy vehicles, JAC has cooperated with Volkswagen in June in developing new energy vehicles, which will undoubtedly help to enhance its competitiveness in R & D, design, production and other areas. JAC will have three new energy vehicles to launch based on the 7th generation platform. And ES8, the first cooperated model with NIO, is expected to be launched in 2018.

JAC's new energy vehicles have entered the large-scale stage. Faced with the fierce market competition, it is still difficult for JAC to break through the dilemma in development.