FAW's car unit blames competition for its 2015 net income plunge
come of FAW Car Co., the car unit of China FAW Group Corp., declined for the second consecutive year in 2015, plunging 65 percent year on year to 52.9 million yuan ($8.1 million).
The company blamed the income slump on price wars on the domestic car market and a lack of competitive products.
Last year, FAW Car sold roughly 235,900 vehicles, a drop of 19.6 percent from 2014.
To shore up sales, the company offered steep price discounts for its products. As a result, the gross profit margin of its vehicles dipped 2.28 percentage points to 18 percent, said FAW Car.
FAW Car, based in the northeast China city of Changchun, produces cars under the Besturn, Oley and Hongqi brands. It also builds the Mazda 6 and CX-9 under a license agreement with Mazda Motor Corp.
The company blamed the income slump on price wars on the domestic car market and a lack of competitive products.
Last year, FAW Car sold roughly 235,900 vehicles, a drop of 19.6 percent from 2014.
To shore up sales, the company offered steep price discounts for its products. As a result, the gross profit margin of its vehicles dipped 2.28 percentage points to 18 percent, said FAW Car.
FAW Car, based in the northeast China city of Changchun, produces cars under the Besturn, Oley and Hongqi brands. It also builds the Mazda 6 and CX-9 under a license agreement with Mazda Motor Corp.
