By Jiahui Huang
BAIC Motor's shares fell sharply in Hong Kong after the company guided for a significant drop in its 2024 net profit, as the state-owned automaker has faced intense competition in China's electric vehicle industry.
Its shares fell 11.2% to 2.29 Hong Kong dollars, equivalent to 29 U.S. cents, on track for their largest one-day percentage loss since October 2024.
The Beijing-based company said late Thursday that it expects its net profit to have fallen 69% to 950 million yuan, equivalent to US$131.1 million, in 2024. The sharp decline is largely due to intensified competition in the domestic auto industry last year, which led to lower sales, the company said in a statement.
The company's increased investment to enhance its competitiveness also contributed to the lower net profit, it added.
As one of China's "big four" state-owned automakers, BAIC has faced increasing competition from rivals, such as BYD, XPeng, NIO and Li Auto. The EV industry has been in a price war since last year, with multiple automakers cutting their prices on flagship models and offering promotions to attract buyers.
BAIC also operates a joint venture with Mercedes-Benz Group called Beijing Benz, but the JV has been under significant pressure from local EV manufacturers in China.
Write to Jiahui Huang at jiahui.huang@wsj.com
(END) Dow Jones Newswires
March 20, 2025 22:52 ET (02:52 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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