SAIC Motor Third-Quarter Profit Rose 27%

SAIC Motor Third-Quarter Profit Rose 27%

SHANGHAI—SAIC Motor Corp., China's largest car maker by sales, said Wednesday that its third-quarter net profit rose 27% from the same period last year as the company's sales growth outpaced the industry.

Net profit for the three months ended Sept. 30 was 4.72 billion yuan ($742.8 million), up from 3.71 billion yuan a year earlier, the Shanghai-based car maker said in a statement.

Revenue rose 19% to 97.41 billion yuan from 81.61 billion yuan.

In the first nine months of the year, "the company overcame the negative impact on the auto industry of macroeconomic policies and improved its product mix to realize full-car sales of 2.9803 million units," up 12% from 2.66 million a year earlier, the statement said.

China's passenger-car sales rose 6.38% from a year earlier to 10.5 million units in the January-September period, according to the semiofficial China Association of Automobile Manufacturers. That compares with 36.7% growth in the same period last year.

Slowing sales growth in China prompted the CAAM in October to cut its forecast for annual auto sales, including both passenger and commercial vehicles, to no more than 3% from 5%. It was the second reduction to the forecast for this year's sales from an initial estimate of 10% to 15% growth.

SAIC Motor, which has vehicle-making joint ventures in China with General Motors Co. and Volkswagen AG, said in August that it forecast industrywide sales growth to slow to 3.6% this year. In March, it said it expected to sell more than 4 million vehicles in 2011, compared with 3.6 million vehicles in 2010.

Auto sales in China have been hit by slowing economic growth, the removal of government vehicle purchase subsidies and the introduction of measures in some cities to reduce congestion by limiting car purchases.

According to the Shanghai Automotive disclosure, consideration by the Board, the company decided jointly with General Motors China Investment set up a "GMAC-SAIC Automotive Sales Co., Ltd." (tentative name), the company registered capital of 49 million, of which Shanghai Automotive invested $ 24,990,000 in cash , 51% of the total share capital. The company's future by General Motors and Shanghai General Motors Co., Ltd. authorization to engage in Buick, Chevrolet, Cadillac brand imported cars and domestic cars of the overall distribution, as well as automobile export business.

Learned that the establishment of sales by the Shanghai Automotive Holdings Corporation, Shanghai GM aims to meet the revenue requirements of the financial statements incorporated into SAIC. Because General Motors, Shanghai GM will buy back 1% stake in SAIC after repurchase of the shares held by Shanghai GM will be reduced to 50%, can not reach the world's five hundred shares of the consolidated financial statements of Standard (Holdings can be combined). To this end, the two sides has set up a new sales company in order to achieve the requirements of the consolidated financial statements.