Dongfeng expected to log 60% YoY slump in H1 net profit due to pandemic hit

Shanghai (Gasgoo)- Dongfeng Motor Group Company Limited (called “Dongfeng” or “the company” for short), a Hong Kong-listed company principally engaged in automobile-related businesses, expects to record a roughly 60% year-on-year plunge in net profit for the first half of 2020, according to a profit warning the company announced on August 24.

(Fengshen Yixuan, photo source: Dongfeng Motor)

Dongfeng's board of directors mainly attributes the expected decrease in operation results to the outbreak of the COVID-19 pandemic since January 2020, which has severely affected the business operations of Chinese companies and consumers' expenses. Headquartered in the epicenter Wuhan, Dongfeng was badly bruised by the viral outbreak in the first quarter of the year, and its overall resumption of work and production was one month later than that of the industry, leading to the downturn in the company's operation results.

As the pandemic was ebbing in China, the production and operation of Dongfeng and its subsidiaries’ (collectively called “the group” for short) bases gradually recovered to normal level since the second quarter, according to the company's announcement. In addition, the group outperformed the overall auto market in sales volume for the second quarter, substantially mitigating the downward trend for the Jan.-Jun. period.

Dongfeng boasted a 12.13% year-on-year growth in July primarily credited to the 57.07% surge achieved by its CV unit. In addition, its PV sales also climbed 4.66% over a year ago to 198,189 units thanks to the rising momentum conveyed by both car and MPV sales.

Thanks to the consecutive rises, the Wuhan-headquartered automaker witnessed the decrease in its year-to-date sales contracted to 12.74%, versus the 16.73% decline in the first-half volume.

Dongfeng Motor Company Limited logged a 14.45% year-on-year increase which substantially resulted from the sales growth achieved by Dongfeng Nissan and Dongfeng Automobile Co.,Ltd. Dongfeng Honda's sales in July rose 9.82% from a year ago. The joint venture has put the mid-cycle refresh of the CR-V and the hatchback version of the Civic this year and will reportedly launch five models in the second half of the year, including an all-new entry-level hatchback.

Dongfeng launched on July 29 the new auto brand “VOYAH” that targets premium new energy PV market. The brand's first concept “VOYAH i-Land” made its world's premiere at the same time.

According to Dongfeng, VOYAH has scheduled 9 models, including SUV, MPV, crossover, etc. and will release at least one model each year over the next 3-5 years.