By Martin Mou
Geely Automobile Holdings said it is bracing for what will probably be one of its toughest years yet as the coronavirus pandemic ramps up pressure on China's already weak auto market.
The Chinese car maker gave the warnings at it posted a sharp decline in 2019 net profit on Monday.
Geely's net profit for 2019 plunged 35% to 8.19 billion yuan (US$1.15 billion), hit by a greater-than-expected drop in overall sales volume and fierce competition that weighed on prices, it said.
Revenue fell 9% to CNY97.40 billion as vehicle sales volume dropped by the same amount to 1.36 million units, Geely said.
The car maker expects the prevailing political and economic uncertainties could continue hurting passenger-vehicle demand in China this year, while the disruptions to its supply chain and production will pressure business volume and profitability.
Intensifying competition will likely squeeze profitability at all Chinese car makers in 2020, Geely said.
The company's vehicle sales plunged 75% to 21,168 units in February due to the pandemic.
To cope with the challenges, Geely said it will continue to increase the proportion of electric vehicles in its overall sales and boost exports to new markets in Southeast Asia and Western Europe.
The company has set a sales target of 1.41 million units for 2020, 4% higher than its total sales volume last year.
Geely proposed a final dividend of HK$0.25 for 2019, down from HK$0.35 a year earlier.
Write to Martin Mou at email@example.com