Chinese carmaker Dongfeng Motor Group on Wednesday said its net profit in the first half of 2012 slipped 8.36 percent on the back of falling commercial vehicle sales and stiffer competition.
Net profit dropped to 5.37 billion yuan ($846 million) from 5.86 billion yuan in the corresponding period of 2011, despite a 6.83-percent rise in revenue to 68.06 billion yuan.
"In the first half of 2012, the sluggish growth of the auto industry in China widened the gap between growth rates of passenger vehicles, especially the traditional passenger vehicles, and commercial vehicles," chairman Xu Ping said.
Dongfeng Motor is the main listed unit of state-owned Dongfeng Motor Corp., China's third-largest motor vehicle maker by sales volume after SAIC Motor Corp. and FAW Group Corp.
It has a joint venture with Nissan Motor and joint production ventures with Honda Motor and Peugeot SA.
Sales of passenger vehicles hit 939,500 during the period, a rise of 21.6 percent over the first half of 2011. Passenger vehicles account for almost 80 percent of the group's revenues.
Commercial vehicle sales fell 18.8 percent to 236,800 units.
It said its domestic market share was 12.3 percent, an increase of 0.9 percent.
"The demand (for) medium and heavy trucks dropped significantly as a result of the weak economic conditions," the company said in a statement to the Hong Kong stock exchange, referring to China's economic slowdown.
Intensified competition had put downward pressure on selling prices of all vehicles, it added.