Sokon Group reports Q1-Q3 net loss of RMB421 million

Shanghai (Gasgoo)- Sokon Group saw its revenue for the first nine months of 2019 slide 18.96% year on year to roughly 11.55 billion ($1.64 billion), the company said on October 30. The net loss attributable to parent company's shareholders was RMB421 million ($59.88 million), versus a net profit of around RMB 49.5 million ($7.04 million) in 2018.

According to Sokon’s explanation, the revenue change was mainly linked to the industry’s destocking of vehicles to meet the China-Ⅵ emission standards. Besides, it attributed the profit decline to the year-on-year sales drop of vehicles and engines. The investment in new energy vehicles (NEV) was also one major factor.   

In the first three quarters, the vehicle sales of the Chongqing-based group fell 15.69% to 213,339 units and its engine sales decreased 17.33% compared with the year-ago period, according to the automaker’s sales report.

Meanwhile, Sokon has made aggressive investment in the research and development of intelligent NEVs in recent years. In 2018, it spent RMB891 million ($127 million) on its NEV R&D with the investment accounting for 53.61% of the total R&D expenses.    

The company is expected to introduce its high-end electric vehicle the Jinkang SERES SF5, the Dongfeng Fengguang E3, and the affordable E1 to the market in the second half of 2019 (photo source: Sokon).