Dear Shareholders,
On behalf of the Board of Directors, I hereby present the annual report of the Company for 2009 for your review.
After the economic downturn and depression in the second half of the 2008, the automobile industry of the PRC recovered rapidly and recorded an unexpected rapid growth. The monthly sales volume of vehicles recorded more than 1 million units since March, and hit a monthly record high of 1.41 million units in December after September and October. In 2009, the annual sales volume of vehicles of automobile manufacturers inthe PRC was approximately 13,644,800 units, representing an increase of approximately 46.2% over last year.
We believe that, in addition to the benefi ts from the macroeconomics andindustrial revitalization policies, the dramatic growth of the automobileindustry in the PRC was mainly driven by the rising income level andconsumption power of residents attributable to the sustainable economic growth in the PRC for years. China’s automobile market is entering a mass consumption era.
Supported by its well-established industrial background and the diligent efforts of our management and staff, Dongfeng Motor Group achieved remarkable sales results. In 2009, the aggregate sales volume of vehicles of the Dongfeng Motor Group was approximately 1,430,700 units, representing an increase of approximately 35.1% over last year. Among which, the sales of passenger vehicles and commercial vehicles were approximately 1,058,800 units and 371,900 units, representing an increase of approximately 45.6% and 12.2%, respectively over last year. Excluding the cross type passenger vehicles and mini trucks, Dongfeng Motor Group accounted for 12.8% of market share in the PRC, which was basically the same as 2008.
In 2009, the Group’s sales revenue was approximately RMB91,758 million, representing a year-on-year increase of approximately 30.0%. Profitattributable to shareholders of the Company was approximately RMB6,250 million, representing a year-on-year increase of approximately 58.0%. The growth of fi nancial results of the Company continuously outweighed the production and sales volume, proving that operating effi ciency of Dongfeng Motor Group kept enhancing and its profi tability was further consolidated and strengthened.
In 2009, Dongfeng Motor Group continued to implement the policy of prudent investment and moderate expansion so as to capture the opportunity arising from the rapid market growth while controlling the costs in an effective way. The actual investment for the year amounted to approximately RMB6.3 billion. As at the end of 2009, the total production capacity of Dongfeng Motor Group was 1,422,000 units of vehicles. In addition, Dongfeng Motor Group optimised its distribution network and adjusted its marketing strategy in response to the characteristics and trend of market structural changes (including regional and market level structural changes) to consolidate and enhance its position in the industry by leveraging on the market growth.
Looking forward to 2010, the automobile industry in the PRC will keep growing at a relatively rapid pace. As mass consumption has become more important and a new trend in the market, Dongfeng Motor Group will further adjust its product mix and market strategy in order to adapt to the volume growth and structural changes. For internal management, the Group will strive to enhance cost control, quality management and operating effi ciency, particularly focus on the continuous improvements in Dongfeng Peugeot Citroen Automobile Company Ltd and the commercial vehicles business, in order to achieve sustainable progress in our operating management, production and sales and fi nancial results.