Why has SAIC Group fallen so sharply?
2 Answers
SAIC Group has fallen so sharply due to market reasons. Below is some relevant information about automobiles: 1. Definition of automobiles: According to the latest national standard of China "Terms and Definitions of Automobiles and Trailers" (GB/T 3730.1-2001), an automobile is defined as a non-track vehicle with four or more wheels, powered by an engine, mainly used for transporting people and/or goods; towing vehicles for transporting people and/or goods; and for special purposes. 2. Introduction to domestic automobile brands: Domestic automobile brands include Hongqi, Changan, Great Wall, Chery, Geely, Roewe, BYD, etc.
I've been keeping an eye on SAIC's movements, and this price drop is largely related to the overall transformation wave in the industry. The traditional fuel vehicle market has shrunk significantly, and now everyone is shifting to electric vehicles. Although SAIC is an old brand, it hasn't kept up with the pace. New players like BYD and Tesla are too aggressive, with cool designs and affordable prices, taking away a large number of customers. The economic environment is also poor, with high inflation, making consumers tighten their wallets and hesitant to change cars. Supply chain issues, such as the ongoing chip shortage, haven't been resolved, leading to frequent factory shutdowns, which directly affect sales and profits. Investors, seeing weak performance and sluggish growth, have been selling off stocks, causing a sharp drop in share prices. To turn things around, they need to quickly bet on innovation, such as increasing investment in electrification R&D, otherwise, they will only sink deeper in the competition. I think this situation won't be easy to reverse in the short term.
