In the first quarter of 2022, in the face of the sharp rise in raw material prices and the interference of the epidemic in March, GAC Group continued to take the lead in the industry with excellent operational capabilities and product foresight.
Text / "Autobot" Zhang Heng
On April 27, GAC Group announced its financial report for the first quarter of 2022, with the company's operating income and net profit increasing by 45% and 27% respectively, and the production and sales of automobiles reached about 600,000 units, outperforming the overall passenger car market by 13-14 percentage points.
Specifically, in the first quarter of this year, GAC Group achieved operating income of 23.145 billion yuan, an increase of 45.67% year-on-year; net profit attributable to the mother of 3.009 billion yuan, an increase of 27.17% year-on-year; deduction of non-attributable net profit of 2.898 billion yuan, an increase of 30.2% year-on-year.
In the first quarter of 2022, GAC Motor Group produced 598,000 vehicles and sold 608,000 vehicles, up 24.96% and 22.48% year-on-year, respectively. Compared with the domestic passenger car production and sales in the first quarter increased by 11% and 9.0%, respectively, GAC Group led by about 14 percentage points and 13.5 percentage points, respectively.
In terms of scale business, GAC Group, an A-share listed company, can be roughly divided into four major sectors, namely GAC Passenger Vehicles, GAC Aegean, GAC Toyota and GAC Honda. The former two are Chinese brand businesses, and the latter two are joint venture brand businesses.
In terms of its own brand business, GAC Passenger Vehicles and GAC Aeon delivered 90,000 units and 45,000 vehicles respectively in the first quarter, up 21.8% and 154.9% year-on-year, accounting for 14.8% and 7.4% of the company's total sales, respectively, accounting for 22.2% of the total.
The comprehensive gross profit margin of independent brands in the first quarter of this year was 6.12%, compared with 5.5% in the same period last year. Gross margins have improved despite sharp increases in the price of automotive raw materials.
In terms of production capacity, the second phase of the capacity expansion of the Aehan plant was completed in February this year, and the production capacity was increased to 200,000 units per year. The construction of the second plant is expected to be completed in December this year, when the production capacity of Aean will be increased to 400,000 units per year. Forward-looking production capacity planning ensures the continuous high sales growth of the Aeon brand.
In terms of joint venture brands, thanks to the eye-catching performance of the new models of GAC Toyota and GAC Honda, the sales of the two major brands in the first quarter were 247,000 units and 212,000 units, respectively, an increase of 23.4% and 16.8% year-on-year, accounting for 40.6% and 34.9% of the group's total sales, respectively.
The profitability of the two joint venture companies increased significantly, and the investment income of the two joint venture brands reached 4.14 billion yuan in the first quarter, an increase of 24.3% year-on-year.
2022 is the new car year of GAC's Japanese joint venture brand, in January, Guangfeng Wesa and Fenglanda were listed, and the Guangben model was listed in December 2021. In addition, the recently launched TNGA flagship model Race sold 15,738 units in the quarter. The new car cycle significantly improved the product structure of the joint venture brand, and the net profit of Guangfeng and Guangben in the first quarter was 0.92 million yuan, an increase of 2.10% year-on-year.
The continuous reduction of the expense ratio reflects the operating efficiency of THE GAC Group. In the first quarter, GAC Group's revenue increased by 45.67% year-on-year, but the expense ratio (including sales expenses, management expenses and research and development expenses) continued to decline, during which the total expense ratio accounted for 10.2% of revenue, lower than 11.2% in the first quarter of last year and 13.2% lower than that in the fourth quarter of last year.
Combining the 2021 annual report of GAC Group and the first quarterly report of 2022, Automan believes that:
First, the company's excellent operating ability has resisted the erosion of profits by rising prices of raw materials (power batteries, chips and aluminum, etc.) in the upstream of the automobile industry to a certain extent.
First, the scale effect of the sharp increase in sales of GAC's own brands; the second is that the EON brand has raised the price of products twice on March 4 and April 8 this year, respectively, and the price increase covers most of the raw material prices. Considering that there are signs of price decline in automotive raw materials and commodities in the near future, the gross profit of independent brands should be able to further improve in the second quarter.
Second, E'an maintained high growth, and Trumpchi entered the hybrid market.
In March, the sales volume of the Aeon brand exceeded 20,000 units per month for the first time, not only sitting in the first echelon of the new car-making forces, but also making great strides, especially the proportion of C-end customers continues to increase. In 2023, the smart pure electric SUV jointly built by EON and Huawei will be mass-produced to help the brand rise and sales.
GAC Trumpchi recently officially released a new hybrid technology brand - Moment Wave Hybrid, and the first model Yingku has also been officially released, and is expected to be listed within the year. Under the sharp decline in subsidies, the market competitiveness of hybrid models will inevitably be further improved.
Third, the product matrix has reached a new level, and the new car cycle is expected.
In the first quarter of this year, in terms of joint venture brands, GAC Honda's Binzhi, Haoying and Guandao, as well as GAC Toyota's Camry, Highlander and Xena continued to sell well, and the sales of new models Fenglanda were also good. In the near future, pure electric models such as bZ4X and e:NP1 are also about to be listed, and the competitiveness of joint venture brands in the field of pure electric vehicles is expected to increase.
In terms of independent brands, in the first quarter, AION launched new models such as AION LX PLUS and AION S PLUS, and will also launch AION Y PLUS and so on during the year; in terms of the Trumpchi brand, the new GA6 has been listed in February, and there are follow-up Models such as Shadow Leopard HEV, Shadow Cool, and new generation M8, which will drive the independent brand power to continue to rise.
"Auto man" previously in the "joint venture strong independent breakthrough, GAC Group 2021 financial report brief evaluation", on the 2022 GAC Group's performance is full of expectations, mainly reflected in the new car cycle, independent brand sustained high growth and gross profit margin improvement of these important indicators.
In the first quarter of 2022, in the face of a sharp rise in raw material prices and the interference of the epidemic in March, GAC Group still handed over a beautiful quarterly report. Despite the continuous interference of external factors, it is foreseeable that GAC Group will continue to take the lead in the industry in a big stride with its excellent operational capabilities and product forward-looking. 【Copyright Notice】This article is the original manuscript of Automan Media, and may not be reproduced without authorization.