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SHANGHAI — Geely Automobile Holdings Ltd. expects rising uncooked materials costs and global chip shortages to stress its profitability and gross sales this yr, the Chinese language firm stated on Wednesday, after reporting a 12 % fall in 2021 revenue.
The automaker, because of its investments in Volvo Cars and Mercedes, reported a 2021 revenue of 4.85 billion yuan ($761.64 million), in contrast with 5.53 billion yuan within the earlier yr. Income rose 10 % to 101.6 billion yuan.
“The intensified competitors in China, the rise in uncooked materials costs, different pandemic-related disruptions and international shortages of chip provide have confirmed no indicators of subsiding and may proceed to place stress on the gross sales efficiency and profitability of the Group in 2022,” Geely Car said in a statement.
Geely Car is concentrating on to promote 24 % extra automobiles this yr, at 1.65 million automobiles, saying it will look to additional develop its export gross sales to new markets in Southeast Asia, the Center East and western Europe.
China’s auto gross sales grew final yr, helped by surging gross sales of recent vitality automobiles, however trade executives have warned in regards to the affect of a world scarcity of semiconductors and rising uncooked materials costs, which have been exacerbated by provide chain disruptions following Russia’s invasion of Ukraine.
In an earnings name on Wednesday, Geely Auto Group CEO Jerry Gan stated the corporate’s reliance on customized chips and globalized provide chains meant the semiconductor scarcity had a “fairly massive impact” on manufacturing, a problem Geely would sort out through localization and in-house chip improvement, amongst different measures.
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