According to Robert Lutz, former CEO of GM, interviewed on CNBC, maintains to switch over a plant is $100M. To keep jobs here, an extra penny or so.
Double digit declines of automobiles in China. According to CNBC, Chinese IMPORT 10X MORE CARS THAN USA IMPORTS FROM CHINA: “Carmageddon coming to China.” Inventory building up – F down 21%, TSLA-Question Mark for earnings call on 5/3/17: According to this author, TSLA not immune to Winds Of Change of other automakers. Also, automobile China sales are barometer of health of China’s general economy ->SPECULATIVE SHORT: BABA.
Chinese Luxury automobile market UP -> SPECULATIVE BUY (NASDAQ: CALI) $2.62 AH.
Sales of Automobiles
During 2016, the Company sold 4,438 automobiles, up 5.7% from the prior year’s sales volume of 4,199 automobiles. However, the average unit sales price in 2016 declined slightly from $105,000 in 2015 to $104,000, and the gross margin dropped to 0.20% in 2016 compared with 0.26% in the prior year. This was a reflection of the continuing competition in the imported automobile market, and the Company’s attempt to remain a leader in this market.
The Company’s top three selling brands in 2016 were Land Rover, Mercedes Benz and Toyota. The strongest sales in 2016 occurred in the first quarter, followed by weaker second and third quarters, reflecting the reaction of the Company’s dealer customers to currency fluctuations. The strong sales of $139.9 million recognized in the fourth quarter, in part, may have reflected customers’ depletion of built up inventories earlier in the year.
The Company believes that sales during 2016 were helped somewhat by the implementation of the government’s parallel import scheme, which placed importers such as CALI on equal competitive footing with authorized automobile importers.
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