China Automotive Systems Inc. (NASDAQ:CAAS) Q3 2018 Earnings Conference Call Transcript
Nov 09, 2018 • 08:00 am ET
Greetings and welcome to the China Automotive Systems Third Quarter 2018 Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Kevin Theiss, Investor Relations. Thank you, Mr. Theiss. You may begin.
Thank you everyone for joining us today. Welcome to China Automotive Systems 2018 third quarter conference call. Joining us today are Mr. Jie Li, Chief Financial Officer of China Automotive Systems. He will be available to answer questions later in the conference call with the assistance of translation.
Before we begin, I would remind all listeners that throughout this call we may make statements that may contain forward-looking statements. Forward-looking statements represent the company's estimates and assumptions only as of the date of this call. As a result, the company's actual results could differ materially from those contained in these forward-looking statements due to a number of factors including those described under the heading Risk Factors in the company's Form 10-K Annual Report, for the year ended December 31, 2017, as filed with the Securities and Exchange Commission, and in other documents filed by the company from time to time with the Securities and Exchange Commission. The company expressly disclaims any duty to provide updates to any forward-looking statements made in this call, whether as a result of new information, future events or otherwise.
On this call, I will provide a brief overview and summary of financial results for the 2018 third quarter and nine-month periods. Management will then conduct a question-and-answer session. The following 2018 third quarter financial results are unaudited and the fiscal year results are audited. These results are reported under US GAAP. And for the purposes of our call today, I'll review the financial results in US dollars. We will begin with a review of the recent dynamics of the automotive industry and China Automotive's market position.
For the third quarter 2018, China's GDP growth slowed to 6.5% from 6.7% in the second quarter and 6.8% in the first quarter of 2018. This number represents the weakest growth since the first quarter of 2009. Industrial production in the month of the September grew by 5.8%, but was below Reuters expectation of 6%.
According to the China Association of Automobile Manufacturers, China's vehicle sales fell 11.6% year-over-year in September 2018, steepest decline in nearly seven years. That dropped followed a year-over-year sales decline of 3.8% in August and a drop of 4% in July. Passenger car sales fell 12% year-over-year to $2.1 million in September, resulting in a third quarter sales decline of 7.6% year-over-year. Commercial vehicles declined approximately 2.2% year-over-year with both bus and truck sales down in the third quarter of 2018.
For the nine-month period ended September 30, 2018, vehicle sales in China rose 1.5%. Passenger vehicle sales totaled $17.6 million for a 0.6% year-over-year gain. Commercial vehicle sales were $3.2 million, up