There are indications that Zotye is in trouble. On the evening of August 19, Zotye Auto disclosed its semi-annual results forecast that the company expects a loss of about 270 million yuan to 320 million yuan in the first half of the year, however, a net profit of 305 million yuan in the same period of the first half of 2018. Zotye Auto said that the net profit loss is expected to be affected by the macroeconomic situation, the overall prosperity of the Chinese auto industry is weak, the sales volume of Zotye Auto has declined, resulting in a significant decline in the company’s semi-annual results.
According to the data of China Automobile Association, the sales volume of Zotye Auto was 73,900 units from January to June 2019, 49.45% lower than the 146,300 units in the first half of last year. The decline in sales of Zotye Auto was not started in 2019. The data shows that total sales volume of Zotye for last year were 234,000 units, down 26.23% year-on-year comparing to 2017. The decline in sales has caused Zotye Auto to be in trouble. Zotye Auto’s 2018 financial report shows that its operating income in 2018 was 14.76 billion yuan, down 29% year-on-year, the net profit attributable to shareholders of listed company was 799 million yuan, down 36% year-on-year, deducting non-net profit shows a loss of 1.24 billion yuan..
In terms of products, Zotye only launched a new virant of Zotye T300 in March of this year, and other new products are scheduled to be slow. In response to the Shenzhen Stock Exchange inquiry letter, Zotye said that in terms of fuel vehicles, A16 and B23 will be launched in the second half of this year. In addition to the loss of performance and the slow launch of new products, Zotye Auto’s suspension of production and wages are riddled with information. According to data, several upstream suppliers have applied for different amounts of property preservation for Zotye Auto this year.
In the high-speed development of new energy vehicles in 2017, Zotye Auto took advantage of the Zotye E200 and other products to occupy the high-end sales of electric vehicles, and got the olive branch of Ford Motor Company’s joint venture cooperation. After two years, the sales of Zotye Auto fell in a cliff-like manner, and news of a joint venture with Ford has not yet made any substantial progress. As far as we are concerned, the future of Zotye is obviously not very optimistic.
