Gasgoo.com (Shanghai March 28) - With winter finally beginning to recede, several domestic Chinese manufacturers have begun longing for the automobile market of previous years. In an interview with China Business News, one Beijing FAW dealership salesperson said that their store had begun offering savings of up to 28,000 yuan on the Besturn B70 (pictured) luxury car.

According to its annual performance report, FAW Car's business returns and net profit last year totaled 32.65 billion yuan ($5.16b) and 217 million yuan ($34.29m), representing a year-on-year decreases of 12.45 percent and 88.34 percent. The manufacturer ran a deficit of 537 million yuan ($84.84m) in the fourth quarter alone.

Analysts from the China Investment Securities believe that FAW Car's second factory, which began operation in the end of 2010, combined with falling sales contributed to the steep fall in the manufacturer's profits.

Dongfeng Motor is another Chinese manufacturer who is falling on hard times. The manufacturer's net profit in 2011 was 464 million yuan ($73.31m), 18.69 percent less than the previous year. A statement from the manufacturer cites the phasing out of certain government policies, increasing price of fuel, domestic financial issues and tapped out demand as reasons behind its lackluster performance. FAW Car also mentioned these factors, as well as a fiercely competitive market, to explain its financial situation.

However, other Chinese manufacturers have managed to maintain strong results through the year. SAIC Group's net profit grew over 40 percent in 2011, with steady sales from its own brand division helping contribute to that increase. BAIC's net profit, meanwhile, increased 46.1 percent last year.
 

Source:gasgoo