GAC Group’s H1 2023 revenue rises YoY, but net profit plunges

Shanghai (Gasgoo)- GAC Group recently unveiled its financial data for the first half of 2023 (H1 2023), shedding light on a period marked by both growth and challenges. While the conglomerate reported a robust 27.16% year-on-year (YoY) increase in consolidated operating revenue, reaching approximately 61.911 billion yuan, its net profit attributable to shareholders witnessed a decline of around 48.42% from the previous year, settling at about 2.966 billion yuan. The basic earnings per share for this period also showed a YoY decrease of around 49.09%, standing at around 0.28 yuan.

Hyper GT; photo credit: GAC AION

GAC Group has not given the specific reasons that led to the net profit decline. However, a glance at the group's sales performance reveals that the performance of joint venture brands weighed down the overall results, while wholly-owned brands are emerging as growth drivers.

In terms of sales, GAC Group's passenger vehicle production and sales for H1 2023 stood at 1.1968 million units and 1.1628 million units, respectively, reflecting a YoY growth of 3.94% and 1.14%. This translates to a market share of approximately 10.32% among domestic automotive enterprise groups.

A closer look within the joint venture brands reveals that GAC Honda reported sales of 289,900 units during H1, marking a YoY decline of 18.89%. On the other hand, GAC Toyota recorded sales of 452,800 units, experiencing a YoY decrease of 9.48%. Collectively, these two joint venture brands contribute to almost 64% of the group's total sales volume, still serving as the primary sales contributors. Thus, their downward trend is inevitably casting a shadow on the group's overall performance.

In contrast to the sluggishness observed in the joint ventures, the surge of GAC Group's self-owned brands serve as new driving force to the group. During H1 2023, GAC Motor achieved sales of 188,100 units, registering a YoY growth of 8.97%. The same period saw the market entry of GAC Trumpchi's first plug-in hybrid MPV model, the E9.

The new energy vehicle-dedicated GAC AION's performance is particularly noteworthy, achieving sales of 209,300 units during H1 with an impressive YoY spike of 108.81% and maintaining consistent monthly sales figures above 40,000 units for four consecutive months. The Hyper GT, equipped with the Xingling E/E architecture, officially hit the market on July 3 as the 20 millionth new energy vehicle produced in China.

Additionally, the financial report indicates that GAC Group invested over 31 billion yuan in R&D during H1, resulting in 1,435 new patent applications, including 616 invention patents.

On the overseas business front, data shows that GAC Group's wholly-owned brands exported around 20,000 vehicles during H1 2023, marking a YoY growth of 29%. GAC AION has ventured into the Thai market, aiming to establish a foothold and expand into the Southeast Asian new energy vehicle market. As of June 2023, GAC Group has established 125 sales and service outlets globally, covering 31 countries and regions.