Rising raw material costs, JAC turned losses in the first quarter

On April 15, JAC Automobile (600418) released the "Anhui JAC Automobile Group Co., Ltd. 2022 First Quarter Performance Pre-loss Announcement". Affected by factors such as the epidemic and shortage of chips, the company sold 129,400 vehicles and chassis from January to March (hereinafter referred to as the "reporting period"). The gross profit of operating business decreased by approximately RMB 418 million compared with the same period of the previous year, and the net profit attributable to shareholders of the listed company is estimated to be a loss of approximately RMB 307 million.

Recently, the China Association of Automobile Manufacturers (hereinafter referred to as "CAAM") announced the national automobile production and sales data for the first quarter of 2022. From January to March this year, the national automobile production and sales were 6.484 million and 6.509 million respectively, an increase of 2.0% and 0.2% year-on-year respectively, and the growth rate was 6.8 percentage points and 7.3 percentage points lower than that in January-February. The China Automobile Association stated that from the perspective of automobile consumption, the consumption momentum is obviously insufficient, and compared with the same period, it has decreased to a certain extent. It is recommended to introduce a policy of halving the purchase tax to support the steady growth of the industry.

The problem of "lack of cores" that has lasted for nearly two years has not been completely resolved, and the prices of bulk commodities such as raw materials for power batteries have risen rapidly, resulting in rising production and manufacturing costs of enterprises. Since entering 2022, some car companies have successively raised the sales pricing of their products. Coupled with the recent repeated domestic epidemics and other factors, the auto industry is facing a lot of pressure.

According to public information, as of mid-April, a total of 28 car companies have announced price increases this year. Before April, the models with higher prices were mainly new energy vehicles, but since April, 3 car companies have raised the price of fuel vehicles. Among them, JAC Automobile announced on March 21 that due to the continued sharp rise in raw material prices, it will raise the official guide price of its E10X Huaxianzi from March 22.

It is worth noting that new energy vehicles are the biggest bright spot of JAC in the first quarter, and also the biggest bright spot in the auto industry. On the whole, the development of the new energy vehicle market has shifted from a policy-driven to a market-driven new development stage, showing a good development situation of both market size and development quality.