General Motors and Volkswagen China partner SAIC Motor said third quarter net profit jumped 46.6%, in line with expectations, on solid demand for cars made with the western automakers.
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The earnings news came a day after rival BYD reported its third-quarter earnings plunged 99% as its aggressive sales strategy backfired when the market began to slow.
Analysts told Reuters SAIC’s earnings could stay solid in the fourth quarter as consumers rush to buy cars before the end of the year on worries that the government may scale back or even scrap incentives introduced last year to boost consumption.
“SAIC has been holding up better than most of its rivals because GM and Volkswagen are long-established brands in the country,” said Huatai Securities’ Chen Liang.
“Both Shanghai GM and Volkswagen have been outgrowing the market even during the summer months when the overall car sales growth slowed down considerably.”
SAIC, which also makes its own brand cars, such as the Roewe line, booked a July-September net profit of CNY3.71bn (US$556.9m), compared with CNY2.53bn a year earlier. Three analysts polled by Reuters had forecast a quarterly profit of CNY3.6bn on average.
SAIC’s broad range of sedans, trucks, buses, sport utility vehicles, multi-purpose vehicles, minivans and pickup trucks, makes it more resilient than peers who make only cars, analysts said.
