Dongfeng Motor tells investors ‘no excuses’ in plans for 2020 goals, Shenzhen stock offering as China vehicle sales rebound

Carmaker to implement goals “with strong style”, chairman says in unusually colourful language in first-half earnings report

Jefferies upgrades the stock to “buy” with a target price of HK$6.70, implying about 20 per cent upside from current levels

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Dongfeng Motor, based in the coronavirus epicentre of Wuhan, reported a 64 per cent drop in first-half earnings. It wants no excuses in chasing its 2020 sales targets. Photo: Shutterstock

Published: 3:02pm, 31 Aug 2020Updated: 10:25pm, 25 Oct 2020

Dongfeng Motor Group saw a 17 per cent slide in vehicle sales across the mainland China market in the first half amid the Covid-19 pandemic. Still, the nation’s third-largest car manufacturer said it will aim for the “best report card” without giving excuses this year.

The Wuhan-based carmaker, which has local ventures with Nissan Motor, Honda Motor, and PSA Peugeot, told staff to step up efforts to complete or surpass seven key tasks and goals in the second half, including completing an A share stock offering on the ChiNext board in Shenzhen.

“Regardless of the severity of the situation, the complexity of the tasks, and the difficulty in achieving the goals, we shall implement them with a strong style,” chairman Zhu Yanfeng said in a statement on Friday in which six-month earnings crashed by 64 per cent.

“All units will follow the group’s assigned goals by not making excuses, not negotiating for more favourable conditions, sticking to the goals in a determined manner, working hard for victory, and eventually obtaining the best report card,” he added.

China’s economic recovery has gathered some momentum after coming out from its worst quarter since the Cultural Revolution when the Covid-19 outbreak was first detected in Wuhan in January. That has encouraged the car industry association to project a rebound in sales in the second half and next year.

Dongfeng expects China’s overall auto industry sales to shrink by 7.3 per cent this year, while its own sales rebound slightly by 1.4 per cent, versus a 3.9 per cent contraction in 2019.