Yulon's 3 Reinvested Automakers in China Hit Record Volumes in 2013

Yulon Group, the largest carmaker in Taiwan, recently said that all its reinvested automakers in China had achieved record sales volumes, and lucrative return on investment to the parent group in 2013.

Yulon's three reinvested Chinese automakers are Dongfeng Yulon Motor Co., Ltd. (produces and sells Yulon's own Luxgens), South East (Fujian) Motor Co., Ltd. (produces Mitsubishi and SEM own-brand cars), and Dongfeng-Nissan Motor Co. (produces and sells Nissans).

SEM sold an annual record of 121,000 units in 2013, a 13.1% growth from the previous year. The company launched the new V5 and V6 SEM sedans in 2013 and also kept vending the V3 sedans, leading to annual sales of about 101,000 SEMs, up 21% from the previous year and a record high. The company's sales of Mitsubishis remained flat at about 20,000 units in 2013.

In 2013, SEM reported annual earnings of about NT$440 million (US$14.7 million), and is expected to contribute return-on-investment exceeding  NT$100 million (US$3.3 million) to its Taiwanese parent China Motor Corp. (CMC) of Yulon Group. SEM is a joint venture between CMC, Fujian Motor Industrial Group (FJMG) and Dongfeng Group of China, and Mitsubishi Motors of Japan.

SEM is scheduled to launch  five models and challenge annual sales goal of 150,000 units in 2014.

Dongfeng Yulon, a 50-50 joint venture between Yulon and major Chinese automaker Dongfeng Group, sold about 32,800 Luxgens in China in 2013, a record high, but only about 2,000 units more than 2012.

In 2012, Dongfeng Yulon sold about 31,000 units of its only offering: the Luxgen U7 sport utility vehicle (SUV), and achieved profit in the first year of operation. In 2014, Dongfeng Yulon is scheduled to launch  the Luxgen U6 compact SUV to expand sales in the high-growth segment in China's automobile market.

Dongfeng Nissan, in which Yulon has a minor stake through its long-term partner Nissan Motor Co. of Japan, is a major ROI maker for Yulon. Dongfeng Nissan sold about 920,000 new cars in 2013, generating eye-catching returns to the Taiwanese shareholder. In 2014, Dongfeng Yulon targets selling some 1.2 million new cars in China.

Institutional investors noted that Yulon expects more than NT$6 billion (US$2 billion) in ROI from Dongfeng Nissan in 2013, translating into contribution of NT$20 (NT$0.67) earnings per share (EPS).