China Carmakers Wield Axe on Staff and Salaries as Crisis Hurts Sales
Kandy Wong 4 November 2008
Mainland carmakers, battered by slower sales in a weakening global economy, are cutting their staff, industry sources say.
At least three more car manufacturers, including Anhui-based Jianghuai Motor, Changan Ford Mazda and Dongfeng Peugeot Citroen, were eliminating some of their staff, the sources said.
Another Anhui-based carmaker, Chery Automobile, was reported to be cutting salaries and axing 4,000 to 5,000 staff because of falling sales.
Spokesman Wang Wei said the firm had no official announcement on staff or salary cuts.
Changan Ford Mazda spokesman Yao Yu said there was no official announcement from the management about cutting staff, adding the firm would not comment on rumours.
Dongfeng Motor spokesman Hu Xindong declined to comment, saying the company was still checking the jobs situation at its plants.
Jianghuai could not be reached for comment.
A report in China Business News said Dongfeng Peugeot Citroen had announced that 1,000 workers would be suspended for three months and given a subsidy of about 5,000 yuan (HK$5,667) each.
There were no actual figures on staff reductions at Jianghuai and Changan Ford Mazda.
However, workers in those factories said that some of the staff were leaving.
“We can’t say there is a large-scale lay-off at Chinese carmakers now, as no manufacturing factories are closed,” said Li Chunbo, a car industry analyst at Citic Securities.
“It’s normal for carmakers to shed some staff on extra shifts because [vehicle] demand now is under pressure. This is an adjustment of manpower pertaining to sales conditions.”
Sales of passenger cars declined 2.7 per cent year on year to 751,500 units in September and dropped 1.8 per cent to 2.05 million units in the first three quarters.
Analysts said the vehicle market might not see a seasonal rebound and car sales growth would remain slow in the fourth quarter.
China International Capital Corp estimated mainland car sales growth at 9.3 per cent for this year and 6.1 per cent next year.
The Ministry of Finance said yesterday that profit at state-backed carmakers was 21.8 billion yuan in the first nine months, down 0.8 per cent year on year.
SAIC Motor Corp saw third-quarter profit dive 78 per cent to 260.8 million yuan.
Chongqing Changan Automobile recorded a net loss of 107 million yuan for the quarter, against last year’s profit of 68.4 million yuan.
Net profit at the commercial vehicle unit of Dongfeng Motor fell 38 per cent to 66.11 million yuan.
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China Carmakers Wield Axe on Staff and Salaries as Crisis Hurts Sales
Kandy Wong
4 November 2008
Mainland carmakers, battered by slower sales in a weakening global economy, are cutting their staff, industry sources say.
At least three more car manufacturers, including Anhui-based Jianghuai Motor, Changan Ford Mazda and Dongfeng Peugeot Citroen, were eliminating some of their staff, the sources said.
Another Anhui-based carmaker, Chery Automobile, was reported to be cutting salaries and axing 4,000 to 5,000 staff because of falling sales.
Spokesman Wang Wei said the firm had no official announcement on staff or salary cuts.
Changan Ford Mazda spokesman Yao Yu said there was no official announcement from the management about cutting staff, adding the firm would not comment on rumours.
Dongfeng Motor spokesman Hu Xindong declined to comment, saying the company was still checking the jobs situation at its plants.
Jianghuai could not be reached for comment.
A report in China Business News said Dongfeng Peugeot Citroen had announced that 1,000 workers would be suspended for three months and given a subsidy of about 5,000 yuan (HK$5,667) each.
There were no actual figures on staff reductions at Jianghuai and Changan Ford Mazda.
However, workers in those factories said that some of the staff were leaving.
“We can’t say there is a large-scale lay-off at Chinese carmakers now, as no manufacturing factories are closed,” said Li Chunbo, a car industry analyst at Citic Securities.
“It’s normal for carmakers to shed some staff on extra shifts because [vehicle] demand now is under pressure. This is an adjustment of manpower pertaining to sales conditions.”
Sales of passenger cars declined 2.7 per cent year on year to 751,500 units in September and dropped 1.8 per cent to 2.05 million units in the first three quarters.
Analysts said the vehicle market might not see a seasonal rebound and car sales growth would remain slow in the fourth quarter.
China International Capital Corp estimated mainland car sales growth at 9.3 per cent for this year and 6.1 per cent next year.
The Ministry of Finance said yesterday that profit at state-backed carmakers was 21.8 billion yuan in the first nine months, down 0.8 per cent year on year.
SAIC Motor Corp saw third-quarter profit dive 78 per cent to 260.8 million yuan.
Chongqing Changan Automobile recorded a net loss of 107 million yuan for the quarter, against last year’s profit of 68.4 million yuan.
Net profit at the commercial vehicle unit of Dongfeng Motor fell 38 per cent to 66.11 million yuan.
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