SAIC Posts 50 Percent Loss in Q1
"The weak results for 2008 are no surprise at all due to the unexpected downturn of the car market in the second half. But the market is warming up since February and SAIC is already showing improvement in Q1 compared with Q4 of 2008," Chen Qiaoning, ABN AMRO TEDA Fund Management told Reuters.
As for the future, SAIC hopes to sell 1.8 million of its vehicles in 2009, maintaining the trend set in 2008. Its financial target remains at RMB119.4bn, up from RMB105.89bn in 2008. Still, the Chinese manufacturer plays it safe: "The outlook for the 2009 domestic auto market is not so optimistic with lots of uncertainties ahead," the company said in a statement.
One of the biggest problems SAIC has to face is SsangYong. The company is already under court protection and announced this week it is preparing to cut 36 percent of its workforce to avoid an all out bankruptcy.
"SsangYong remains a big issue hanging out there for SAIC, but without additional provisions presumably this year, its results for 2009 could be prettier," Chen was quoted as saying by Reuters.
SAIC will remain a core company in the future Chinese automotive market, as the government has already announced SAIC will be one of the four main companies, along side First Automotive Works (FAW), Dongfeng Motor and Changan Auto.