China’s auto industry loses profits
China's largest carmaker First Auto Works (FAW) Car Co., announced that its net profit in the first half of 2005 could fall more than 50% year on year due to sluggish sales, rising costs and government moves to tighten credit for car buyers.
The overall car industry saw 57% decrease in the profits through January – April 2005 and the profits may decrease further.
The decreasing car prices due to the sluggish demand and rising steel and rubber costs led to a decrease in the profit margins of the industry.