Dongfeng Motor Group has raised its 2010 sales target as Chinese carmakers posted strong first half growth but expects numbers to moderate through to the end of the year.
Dongfeng expected sales this year to reach 1.8m units, up from a previous target of 1.65m to 1.7m, company president Zhu Fushou told Reuters at a mid-year results briefing.
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He added that sales growth had slowed in recent months, with sales in the second half expected to be lower than the first half when the company sold 972,000 vehicles, up 59% year on year.
“Our gross profit margin could hold steady in the second half if we achieve the sales target,” Zhu said.
China, the world’s largest auto market, saw strong demand for vehicles in the first half fuelled by government stimulus policies. It lifted Dongfeng’s gross profit margin by 4.8% to 22.7% in the six month period.
Zhu said overall auto sales in China were likely to rise about 17% for the year. That would mark a considerable slowdown from the 47.7% increase in the first half, as Beijing takes measures to cool the economy to keep it from overheating.
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By GlobalDataLast week, Dongfeng reported a net profit of CNY6.53bn (US$960m) for the first half of 2010, more than double the CNY2.56bn it earned for the same period a year earlier.
It plans to invest CNY3bn ($441.4m) in the next four to five years to develop and produce green energy cars in China to help reduce carbon dioxide emissions, said executive vice president Zhou Wenjie.
“We plan to roll out hybrid and pure electric cars together from 2012 or 2013,” he said.
