FAW Xiali stops producing two series of models
Shanghai (ZXZC)- On December 12, FAW Xiali issued an announcement of its production and sales volume. According to the announcement, 2,086 vehicles were sold in November, a decrease of nearly 47% compared with the same period of previous year; a total of 23,200 vehicles were sold in the first 11 months, a year-on-year decrease of about 30%.
In addition, the announcement also shows that, among the three brands under FAW Xiali, saying, Xiali, Weizhi and Junpai, there is no output in the production of Xiali series and Weizhi series. Junpai series’ production in November was only 1,186 units, a year-on-year decline of 50%. In contrast, sales of the three brands in November were 290 units, 75 units and 1,721 units respectively.
It is noteworthy that Xiali series has stopped production since June this year and that its sales in the past three months remained at about 200 units. Weizhi series also experienced a single-digit production in January and July this year. Average sales of Junpai series in the past three months is still about 2,000 units, which was far away from some hot models’ single-month sales.
FAW Xiali's sales downturn is directly reflected in the company's huge operating losses. According to FAW Xiali latest earnings report, operating income in the third quarter is about 374 million yuan, falling 20.26% compared with the same period of previous year; net profit attributable to shareholders of listed companies is a net loss of about 437 million yuan, an increase of 42.86% in the loss over the same period of previous year.
Although FAW Xiali did not give the detailed reasons for the loss, it can be inferred from the performance forecast released previously that the undone adjustment of product structure, the small scale of product production and sales as well as the weak profitability are the major factors.
After FAW Xiali failed to transfer its shares, the company turns to the acceleration of new products’ launching as well as the transformation and upgrading of products in the hope of returning to the market.