Guangzhou Automobile Group (02238) issued a profit warning, expecting a net loss attributable to the parent of 1.82 billion to 2.6 billion yuan in the first half of the year, a year-on-year change from profit to loss.

Guangzhou Automobile Group (02238) announced that it is expected to incur a net loss attributable to the owners of the parent company of RMB 1.82 billion to RMB 2.6 billion in the first half of 2025, a year-on-year change from profit to loss; the expected non-recurring net loss is RMB 2.12 billion to RMB 3.2 billion, compared to a non-recurring net loss of RMB 338 million in the first half of 2024. In the first half of 2025, the company vigorously implemented reforms in the integrated operation of its independent brands, actively took multiple measures to advance reform, innovation and transformation, and laid a good foundation for stabilizing and improving performance. The work of "stabilizing joint ventures, strengthening independent brands, and expanding the ecosystem" has achieved preliminary results, with the joint venture company GAC Toyota Motor Co., Ltd. experiencing a recovery in production and sales. However, due to the impact of multiple factors, the net profit attributable to the owners of the parent company is expected to show a loss compared to the same period last year. The main reasons are: first, several key new energy vehicle models launched by the company in the first half of 2025 are still in the initial stage of sales, and have not met their planned targets. Several flagship models have been affected by price wars, leading to a decline in profits; second, there is a structural mismatch between the existing sales system and the demand for new energy transformation. The sales channels are mainly traditional 4S stores, lagging behind in the development of direct sales, agents, online channels, etc., resulting in a slow improvement in the efficiency of the marketing system; third, the results of the integrated operation reform of independent brands are still in the early stages and will require more time to demonstrate effectiveness. In the first half of 2025, the company will continue to improve the efficiency of new product development and cost control in various areas; fourth, the company's overseas sales foundation is weak and there is still room for improvement in channel construction, product management, and operational coordination. In the second half of 2025, the company will continue to push forward with the work of "stabilizing joint ventures, strengthening independent brands, and expanding the ecosystem" by launching extended-range new models, accelerating channel sinks, enhancing new media marketing, and other strategies in an effort to increase sales and improve profits.