Foton Motor: Demand advances in advance, next year's performance or slowdown

Near the end of the year, the auto market once again ushered in hot scenes. However, during an interview with Foton Motor , reporters frankly stated that even if the “cars go to the countryside”, trade-in replacement, direct subsidies for car purchases and other stimulus policies can continue, but due to advance purchases, and in the absence of incremental demand, this policy will be applied to cars. The marginal effect of sales is decreasing, and the probability of another blowout market similar to this year in 2010 should be reduced.

As a leader in the domestic commercial vehicle industry, Foton Motors seized a huge business opportunity brought by policy adjustments this year. From January to October this year, it sold 496,600 total vehicles, an increase of 34.8% year-on-year, of which light trucks achieved sales of 391,810, an increase from the same period last year. 34.8%, sales of medium and heavy trucks reached 67,600 units, a year-on-year increase of 20.8%, and achieved the best sales performance in the company's 13-year history.

However, people in the sales department of Foton Motor Market also admitted that by removing the contingency factor of the stimulus policy, it is difficult for the light truck and medium- and heavy-duty card markets to achieve real growth. For light trucks , it is a mature industry, and achieving a balanced growth of 5% to 10% each year is a normal growth. From January to September this year, due to policy incentives, the industry grew by 17.35%, which includes buyers worried about policy withdrawal The demand for early purchases will occupy some of the sales in 2010. At the same time, as the increase in urban employment, similar to the 2009 urban migrant workers returning home to buy cars will certainly return to normal levels. Therefore, it is very unlikely that the light truck industry will continue to experience significant growth.

For heavy trucks , due to the role of policies, the seasonal pattern of high sales of heavy trucks was broken between March and May of previous years. In 2009, the sales peak of heavy trucks was adjusted from August to October, which is expected to be heavy trucks from March to May 2010. The emergence of sales peaks has caused great questions. In addition, if the investment in fixed assets cannot continue to grow and the volume of cargo does not increase substantially, the new demand in 2010 will surely decrease.

The rising cost pressure from the upstream is another difficult problem facing the company. Company sources said that this year's sharp decline in steel prices directly reduced the vehicle manufacturing costs, but the market sales in the same period, the terminal vehicle sales did not cut prices, which greatly enhance the company's profitability. The data shows that the company's comprehensive gross profit margin has rapidly increased from 7.7%, 8.7%, and 8.1% in the past three years to 12.2%, and the cost has contributed. However, under the current situation that inflation expectations are gradually increasing and the PPI index continues to rise, people from Foton Motor stated that the cost pressure on the auto industry will not be overlooked.

In addition, in the face of strong market demand, the domestic automobile industry has set off a new round of expansion. The expansion of industry capacity may also cause companies to face more severe market competition.

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