Performance subsidy relies on Jianghuai passenger car to replace the standard

On October 9, Jianghuai Automobile (600418, SH) announced that as of September 30 this year, the company and its holding subsidiaries had received revenue related government subsidies of 2009.4 million yuan (excluding the government subsidies disclosed by the company in the previous period). This subsidy fund will be included in the current profit and loss in 2020, which will have an impact on the company’s profits in 2020. This is the third subsidy from the government since September. According to the statistics of the first finance and economics reporter, as of the announcement date, JAC has already received nine government subsidies this year, with an accumulated amount of 817 million yuan. According to the financial data released by the company, in the first half of this year, the operating revenue of JAC was 24.941 billion yuan, down 7.6% year on year; the net profit attributable to shareholders of listed companies was – 147 million yuan, compared with 125 million yuan in the same period last year. However, if the government subsidies received by the company in the first half of the year are included, the net loss of JAC after deducting non-profit in the first half of the year is as high as 650 million yuan. However, in the past three years, the deduction of non net profit of JAC automobile has been negative, which depends on the multiple subsidies of the government, so it can be exempted from “ST”. The sharp decline in passenger car sales is the key reason for the continued sluggish performance of JAC. In 2016, JAC achieved the best performance in 10 years. In that year, the company’s net profit after deducting non-profit reached 844 million yuan. Behind the good performance is the good performance of JAC small SUV in the market. According to the data, in 2016, the sales volume of Jiangsu Huaihe SUV reached 275500, a record high; the sales of MPV also reached 58700. However, with the upgrading of the domestic SUV market in 2017, the consumption of small SUVs has declined, and the sales volume of JAC automobile has started to decline, driving down the performance. < / P > < p > according to official data, in the first eight months of this year, the company sold 288000 new cars, although it only dropped by 0.47% year-on-year, almost equating with last year. However, the growth of Jianghuai Automobile sales was mainly driven by the commercial vehicle sector, with a cumulative sales volume of 195000 vehicles from January to August, up 11.7% year-on-year. Sales of passenger cars in the first eight months were only 93000, down 19% year on year. In the passenger car sector, sales of SUVs, MPVS and cars fell by 23.3%, 13.5% and 13.9%, respectively. < / P > < p > “the passenger car foundation of JAC is indeed relatively weak.” An insider of Jianghuai Automobile told the reporter that as an enterprise developing both business and passenger transportation, JAC hopes to make use of various resources to gain a firm foothold in the passenger car market. The marriage with Volkswagen Group is the focus of JAC’s current borrowing power. At the end of 2017, Jianghuai Volkswagen joint venture was officially established. In 2018, the quality management system of the first model of Jiangyue Passenger Car Co., Ltd. was introduced in huaijia automobile line, and the quality management system of the first model of Jiangyue passenger car was introduced into the production line of Huaihua Automobile Co., Ltd. in 2018, the quality management system of the first model of Jiangyue passenger Car Co., Ltd. and Volkswagen was introduced In order to attract consumers. In the first half of this year, JAC further launched Jiayue series X7 and X4. Judging from the current sales volume, Jiayue series accounts for 20% of the sales volume of Jianghuai passenger cars. < / P > < p > however, this is only the first step. At the just concluded Beijing auto show, JAC displayed the fourth new car produced by VW on the same line, Sihao X8, a medium-sized SUV with six seats, which is priced at 89800-135800 yuan. It is worth noting that Sihao X8 does not adopt the “JAC” logo as the rest of JAC’s passenger cars, but adopts the brand-new “Sihao” brand logo as the products of the joint venture company. < / P > < p > “JAC started with commercial vehicles, so in our inherent understanding,” JAC “represents commercial vehicles. We also hope to use Sihao’s brand logo to strengthen the product sequence of Jianghuai passenger cars and distinguish them from commercial vehicles.” The insiders of the above-mentioned JAC automobile told reporters. According to the consensus reached between JAC and Volkswagen Group, the two sides will verify the products of JAC, “one reaching the standard, one in total”. Next, Sihao will also launch X7 and X4 models. In the next few years, JAC will rely on the new modular platform to launch a number of new models and modified models: entry-level compact SUV X5, A-class SUV S811, pure electric A-class SUV x811, a + class SUV, brand-new intermediate cars and existing key new product modifications. < p > < p > Jianghuai Automobile’s chairman an Jin said in an interview that JAC entered the passenger car market from commercial vehicles for many years. Only through cooperation with the outside world did he “know that he didn’t know”. He said that through cooperation with the Volkswagen Group, JAC had improved its quality control and process system. Next, he would like to What we do is to “reduce what we don’t know” and drive the JAC automobile upward. < / P > < p > this is a choice for JAC. However, whether Sihao can boost the performance of Jianghuai passenger cars in the market is still unknown. On the one hand, as a new brand of Jianghuai Volkswagen joint venture company, Sihao’s own brand and market accumulation are very weak; on the other hand, Sihao X8 is still sold in the dealer channels of Jianghuai passenger cars. Before changing the standard, JAC did not spend time to pave the way for the story and future of this new brand, which may let consumers have a better understanding of its brand Positioning produces confusion. < / P > < p > Disclaimer: the purpose of this article reprinted by china.com finance and economics is to convey more information and does not represent the views and positions of the website. The content of this paper is for reference only and does not constitute investment advice. Investors operate accordingly and bear their own risks. < p > < p > Chinanet is a national key news website under the leadership of the Information Office of the State Council and managed by China foreign language publishing and Distribution Bureau. 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