GAC Group posts 28.4% year-on-year drop in Q1 net profit

Shanghai (Gasgoo)- GAC Group’s revenue for the first quarter of 2019 reached RMB14.256 billion, slumping 25.74% compared with the same period last year, the automaker reported on April 29.

Meanwhile, the company saw its quarterly net profit attributable to shareholders of the public company tumble 28.4% year on year to RMB2.778 billion. Excluding non-recurring gains and losses, the Q1 net profit amounted to RMB2.21 billion, plunging 41.87% over a year ago.

In addition, the weighted average return on equity was 3.56%, compared with 5.44% for Q1 in 2017. Basic earnings per share declined to RMB0.27 from RMB0.38 a year earlier. 

According to GAC Group’s sales report, the carmaker sold 494,734 vehicles through March, posting a year-on-year drop of 2.69%. Nevertheless, two major Sino-Japanese joint ventures—GAC Honda and GAC Toyota—still gained impressive increase of 11.41% and 45.58%, which largely offset the downturn occurring to other subsidiaries.

GAC FCA and GAC Mitsubishi witnessed their Q1 sales plunged 41.32% and 16.61% year on year respectively. The former recently underwent a significant personnel change--Daphne Zheng, President of the Guangzhou Automotive Group Fiat Chrysler Automotive (GAC FCA) Sales Co.,Ltd and FCA's Chief Operating Officer for China, will be leaving this group with her whereabouts remaining unknown for now. Max Trantini will succeed her as President of the joint venture sales company. 

The group's wholly-owned subsidiary GAC Motor witnessed its Q1 sales plunge 41.04% from the previous year to 88,038 units.

New energy vehicle (NEV) is expected to be GAC Group’s new growth point. For the first quarter, the automaker sold 5,191 NEVs in total with a remarkable growth of 71%. The Aion S BEV sedan, which was launched by GAC NE, hit the market on April 27. At the Auto Shanghai 2019, the NEV subsidiary unveiled the Aion LX SUV, which is scheduled to go on sale in September this year.