BEIJING (Reuters) – Anhui Jianghuai Automobile Group (JAC) expects its 2024 results to show a loss, it said on Friday, citing the weak performance of its joint venture with Volkswagen.
The Chinese automaker’s stock market filing said it would swing to a net loss of 1.8 billion yuan ($249 million) from a 1.5 billion yuan profit in 2023.
Volkswagen Anhui, 25% owned by JAC and 75% by VW, made a loss in 2024, resulting in a confirmed loss for JAC of about 1.4 billion yuan from its investment in the joint venture.
The company also expects to make a provision of 1.1 billion yuan for asset impairment, the filing said, without elaborating.
Volkswagen said the financial result was “expected” in a statement to Reuters.
The JV has made “substantial investments” in factory infrastructure construction and research and development, and is “in the stage of ramping up production capacity,” the statement said.
JAC is due to report its full-year results on March 29, but Chinese companies sometimes voluntarily disclose earnings estimates when they anticipate significant changes.
The plant of VW Anhui, the German automaker’s only majority-owned China JV, has been producing Cupra Tavascan electric SUVs for export to markets including Europe. Cupra Tavascan’s sister car ID.UNYX, built at the same plant, was launched in July 2024 for the Chinese market.
VW’s unit sales in China fell 10% last year in what it described as a “fierce price war”. It did not give a breakdown of sales from its Anhui JV.
($1 = 7.2410 Chinese yuan renminbi)
(Reporting by Qiaoyi Li and Brenda Goh; Editing by David Goodman and Toby Chopra)
