Geely Auto 2011 profit up 13% on Demand for Cars in China
Published on March 23, 2012 by Joey Wang
Geely Automobile Holdings Ltd., whose parent owns Volvo cars, posted a 13 percent gain in 2011 profit on Chinese demand for new vehicles.
Net income rose to 1.54 billion yuan ($244 million), or 0.19 yuan a share, from 1.37 billion yuan, or 0.17 yuan, a year earlier, Geely said in a statement to the Hong Kong stock exchange yesterday. That beat the 1.47 billion yuan average of 21 analyst estimates compiled by Bloomberg.
China has stepped up efforts to help Geely and other local automakers facing increased competition from foreign rivals such as General Motors Co. (GM) and Volkswagen AG. (VOW) The industry regulator has included 19 Geely models on its list of cars that government agencies can buy, shutting out overseas producers.
The market share of local-brand cars, excluding minivans, multipurpose vehicles and SUVs, fell 1.78 percentage points to 29.11 percent last year, according to the China Association of Automobile Manufacturers.
Geely’s vehicle sales rose 1 percent to 421,611 units in 2011, lagging behind the 5.2 percent gain of the passenger-car market in the country. The company is targeting a 9 percent increase in sales to 460,000 units this year, it said in January.
Geely’s parent, Zhejiang Geely Holding Group Co., signed a memorandum of understanding this month with its unit Volvo Cars to transfer vehicle technology to establish a new brand and enhance competitiveness.