Changan Automobile: Micro- and Sedan Drive Growth


Chang'an Automobile Co., Ltd. is a leading company in the automotive sector, especially in small-displacement vehicles. It ranks first in the micro-vehicle industry, with brands such as Ford and Mazda, and has cooperation relationships with foreign companies such as Ford Motor.

The performance of the benefited national policy has risen sharply. In the first half of 2009, the company realized operating income of 11.283 billion yuan, an increase of 43.19% year-on-year; net profit attributable to the parent company was 533 million yuan, a year-on-year increase of 18.35%. The collective blowout of small-displacement vehicles in the first half of the year was mainly due to the stimulation of national policies. At the end of the year, the temporary policies such as auto purchase tax concessions and automobile subsidy for the countryside were about to expire, and the trend of future policies will become the key. The recovery of the auto industry plays an important role in stimulating household consumption. Based on the country’s policy guidelines of promoting consumption and ensuring growth, the auto industry is expected to continue to benefit from the national favorable policies, while the purchase tax policy may increase its intensity, not excluding small-displacement. Passenger vehicles completely abolished purchase tax, etc. The company is expected to continue to benefit as a leading player in the field of small-displacement passenger vehicles.

Micro-cars and self-owned brand cars have great potential. At present, the company’s micro-occupancy market share is 29%, and it is the industry leader with SAIC-GM-Wuling. The characteristics of the oligopolistic market in this market segment are very obvious. The current net profit of the company’s bicycles is 1,500 yuan. If the car’s loss factor is excluded, the profitability To be even higher, the sustainable development of mini vehicles in the future will be the key to the profitability of the company's headquarters. In 2009, the growth of the auto industry is inextricably linked to the needs of second- and third-tier cities and rural areas. This is extremely beneficial to China’s own-brand car companies, and Chang’an’s sedan business is also In the face of a breakthrough, the company's market after the listing of Yue Xiang responded well. Guojin Securities expects the company to turn around in 2010.

CICC believes that the prosperity of the auto market has become the most reliable way to stimulate the domestic economy to get out of the bottom, and the company will fully benefit from the growth of automotive demand in inland provinces and rural areas, and its car business is better determined.



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