Weichai Power Expects Strong First Half Performance, Heavy Truck Industry on the Rise
On July 2, Weichai Power, a leading Chinese heavy-duty vehicle engine manufacturer, announced its semi-annual performance forecast for 2023. The company expects to achieve a net profit of 3.587 billion to 4.065 billion yuan ($556 million to $628 million) in the first half of the year, a year-on-year increase of 50% to 70%. After deducting non-recurring gains and losses, the net profit is expected to be 3.3 billion to 3.87 billion yuan ($513 million to $601 million), a year-on-year increase of 105% to 140%.
The positive performance forecast is attributed to the recovering domestic economy and strong demand in the export market. Weichai Power has benefited from the improving heavy truck industry in China, as well as the growth in strategic emerging businesses such as large-bore engines and hydraulic pressure products. The company’s strategic market breakthroughs have contributed to its substantial growth in performance.
Yin Yanji, an analyst at Huaan Securities, commented on the future development prospects of the heavy truck industry, stating that heavy truck sales are in a stage of recovery growth this year, and may experience rapid upward growth in the next year or two.
According to data from the China Association of Automobile Manufacturers, the sales volume of China’s heavy truck industry in the first half of 2023 reached 474,000 units, a year-on-year increase of 25%. This indicates a recovery trend in the industry, which experienced a trough in the past two years. The gradual recovery of the domestic economy and strong export demand are identified as the main reasons for the industry’s overall recovery.
Weichai Power has also achieved significant growth in its export market. In the first quarter of 2023, the company exported 18,000 units of engines, a year-on-year increase of 59%, and exported 13,000 units of heavy trucks, a year-on-year increase of 164%. The company stated that the current export situation continues to improve, which will help achieve its annual export target.
Weichai Power’s strong performance in the first half of the year is credited to its diversified new business formats. The company has focused on strategic development in areas such as large-bore engines, high-horsepower engines, and exports. The transformation of heavy-duty truck engines to high-horsepower and large-displacement has contributed to the company’s accelerating growth.
Furthermore, Weichai Power has made significant progress in its high-end hydraulic pressure business, achieving a year-on-year increase of 67% in sales revenue in the first quarter of 2023. The company is also actively deploying in the field of new energy, including pure electric, hybrid, and fuel cell technologies.
The recovery and improvement of the heavy truck industry, coupled with Weichai Power’s expanding market share and strategic business development, have laid a solid foundation for the company’s future growth. With the continuous recovery of the macroeconomic environment and strong demand for heavy trucks, the industry is expected to see significant improvements in the second half of the year.
It is important to note that the information provided does not constitute investment advice, and readers should proceed accordingly at their own risk. The article was sourced from Securities Daily and authored by Wang Xi.