Dongfeng Motor Group Co Ltd,China’s second-largest automaker,posted a 30 percent drop in third-quarter net profit as consumers shunned cars made by Japanese-Chinese ventures amid a territorial row between the two neighbours.
Net income fell to 1.76 billion yuan ($281.97 million) in July-September,according to Reuters calculations based on nine-month earnings data released by the automaker on Friday. Dongfeng made a profit of 2.49 billion yuan a year earlier.
Dongfeng’s auto sales,which include vehicles sold by its ventures with Nissan Motor Co and Honda Motor Co,tumbled nearly 22 percent in September after a diplomatic row over disputed islands triggered waves of anti-Japan protests and a boycott of Japanese goods.
Dongfeng relies heavily on the two Japanese partners. If Nissan and Honda have fallen victim to the dispute,Dongfeng will suffer just as much,said John Zeng,Asia director of industry consultancy LMC Automotive.
Dongfeng’s auto ventures with Nissan and Honda accounted for nearly 80 percent of its overall sales in the first nine months.
By contrast,bigger rival SAIC Motor Corp,which has joint ventures with General Motors Co and Volkswagen AG,posted a 4.6 percent gain in September sales.
Dongfeng’s shares closed 3.1 percent lower in Hong Kong trading,before the results were announced,underperforming a 1.2 percent fall in the Hang Seng Index. ($1 = 6.2417 Chinese yuan)