(Bloomberg) -- SAIC Motor Corp., China's largest automaker, said its first-half profit may have more than quadrupled from a year earlier because of rising demand for vehicles in the world's most populous nation.
The Shanghai-based automaker didn't provide earnings figures in a statement today to the city's stock exchange. Net income was 1.4 billion yuan ($207 million) in the first half of 2009, according to the statement.
China's passenger-car sales have risen every month since February 2009 after the government halved consumption taxes on small vehicles. SAIC, a partner of General Motors Co. and Volkswagen AG, increased sales of Buick Excelle compacts, VW Passat sedans and other vehicles by 44 percent to more than 1.77 million units in the first half, today's statement said.
“SAIC has done a good job in the first half,” said Zhang Xin, an analyst at Guotai Junan Securities Co. in Beijing. “A low base in the first half of 2009 also has helped this year's rate of profit growth.”
Listed companies in China are required to make an announcement if they expect earnings to rise or fall more than 50 percent in a reporting period. The company will provide detailed earnings on Aug. 26, it said.
Partners GM and Volkswagen are the two largest foreign automakers in the nation, according to the China Association of Automobile Manufacturers. China is the world's biggest auto market.
GM and its local ventures, which include separate car and minivehicle-making partnerships with SAIC, are “on track” to sell more than 2 million vehicles in China this year, four years ahead of schedule, the U.S. automaker said on April 12.
SAIC bought an additional 1 percent stake in Shanghai General Motors Co., the two companies' car-manufacturing venture, in March, raising its stake in the venture to 51 percent.
The company said on June 24 it aims to raise as much as 10 billion yuan in a share sale to expand development of its own-brand vehicles.
SAIC forecasts sales of 3 million units this year, President Chen Hong said in late May.
SAIC-GM-Wuling Automotive Co., SAIC and GM's minivan venture, aim to boost sales by 41 percent to 1.5 million vehicles annually by 2015 from last year, Shen Yang, president of the venture said on July 18.
China's passenger-car sales to dealerships rose at the slowest pace in 15 months in June as inflation reduced consumers' purchasing power.