Geely's London cab unit posts HK$17.8m loss
Geely Automobile Holdings' bet on London's iconic taxis continues to struggle, with its Shanghai-based carmaking unit swinging to a loss in the first six months of the year.
Shanghai LTI Automobile, Geely's five-year-old joint venture with London-listed carmaker Manganese Bronze Holdings, booked a first-half loss of GBP1.4 million (HK$17.8 million) compared with a modest profit of GBP200,000 a year earlier, according to an analysis of Manganese Bronze's stock exchange filings yesterday.
Geely owns 20 per cent of Manganese, which in turn has a 48 per cent stake in Geely-controlled Shanghai LTI. The British firm blamed the loss on 'increased costs, low taxi sales into Asian markets and a lack of orders for the tooling company'.
Manganese said taxi sales outside Britain, excluding a 300-car delivery to Azerbaijan, reached 174 units in the first half, up from 112 a year ago.
Total sales during the period were 1,222 cars, up from 915 a year earlier. First-half revenue rose 16 per cent to GBP38.7 million, while the group's pre-tax loss narrowed to GBP700,000, down from GBP4.9 million a year ago.
Geely officers had said earlier this year there was a good chance of Manganese turning profitable this year.
Geely declined last year to exercise an option that would have raised its stake in loss-making Manganese to about 52 per cent from 20 per cent, saying the book value of its five-year initial investment had been 'fully depleted' in the first half of last year.
Richburg Motors acts as the exclusive Hong Kong and Macau dealer for mainland-made London black taxis. It said last year it was working with Geely on an LPG model that could be used as a Hong Kong taxi, but that plan has yet to materialise.