State-owned automaker suffers heavy losses as Jaguar Land Rover and Qoros ventures stumble
Not going anywhere Image: Aaron.huo |
Chery Automobile Co has seen profits fall 86% to 127m ($20.5m) last year as two of its international joint ventures have failed to make a profit.
The company, which is owned and controlled by the Wuhu municipal government, actually increased its own-brand sales by 4% to 455,380 vehicles and boosted average yields to 80,000 yuan ($13,000) in 2014 from 50,000 ($8,000) the previous year.
However, despite the impressive rise in profitablity and sales, its investments in Chery Jaguar Land Rover Automotive Co and Qoros Automotive Co have suffered huge losses.
In a recent interview, Chery Chairman, Yin Tongyu, reported that its partnership with the iconic Jaguar Land Rover brand had lost 584m yuan ($94m) in 2014 alone.
However, its investments in Qoros Automotive Co have proven even more costly. Chery reported the 50-50 venture between Chery and Israel Corp has lost more than 2.1bn ($338m) since it was established in 2007.
Chery invested an additional 1.6bn yuan ($257m) into the two joint ventures last year.