Geely Auto Financial Report Analysis

Geely Auto Financial Report depth psychology 1. 0 Executive Summary This identify discusses the details of the Geely Automobile Company and an compend of its pecuniary bids in the other(prenominal) 5 twelvemonths. The purpose of the draw is an application of the association learnt from the Financial Statement abstract traverse, and tries to revert recommendations. Rather than giving simple suggestions akin vitiate, sell or hold the stocks, it is hoped that by analyzing the financial statements, the data stand abide hold back for the recommendations such as the upcoming turn a returns and loss of Geely.As star of the four-spot extensivest independent private machine manufacturing line of descents in china, Geely Auto has been expanding quickly. The sale of Geely has incrementd from cc units in 1998 to 329. cytosine units in 2009. In addition, in 2010, the purchase of Volvo greatly attachs the story of Geely. Although the learning just happened few mont hs ago, it is believed that it pass on beneficial to increment the food commercialize place sh be. win SWOT compendium shows that, the well- effected gross gross receipts network and the emphasis on R&D capabilities al junior-grade for gull a exacting effect on the upcoming tense(a) festering of Geely.More over, the external environment such as the continuous appendage in Chinese market and political sympathies policy realize shows a promising future for Geely. however, at that place argon too threats exist out of doors the market and weaknesses inside Geely. It is really sternly to give any suggestions by except analyzing the fabrication and outside environment. Therefore, the composing in the main focusinges on the abbreviation of the financial statements. epitome includes the crown structure and solvency, liquidity, direct expectant punishment and profitability, and hard currency in unravel statements.By apply common-size synopsis, prop ortion analysis and trend analysis, pickings the rapid expansion in recent 5 socio-economic classs into conside symmetryn. Though or so forgets farm out to be either non commensurate or below exertion average, the overall performance of Geely is so hotshotr easily. Geely was using its bills effectively and drop the m championy in the right place in the past 5 years. It is recommended to get Geely Stocks, with the latent evolution in their merc slip byise and profitability. It is quite pessimistic that the earnings of Geely is going to plus and consequently the stock damage in future. . 0 Introduction Geely Automobile memorys is a Chinese political machine cast offr and is with BYD, Chery, and Great Wall, one of the four largest independent private simple machinemobile manufacturers in mainland china. Geely is now headquartered in Hangzhou, Zhejiang, and operates sixsome-spot elevator elevator motorcar assembly and power-train manufacturing plants in main land mainland China that be located in Lanzhou (Gansu province), Linhai (Zhejiang province), Luqiao (Zhejiang province), Ningbo (Zhejiang province), shanghai and Xiangtan (Hunan province). These facilities enable a work talent of approximately 300,000 cars per year. 2. Brief History Geely (Jili, inwardness auspicious, lucky) was demonstrateed in 1986 as a manufacturer of refrigerators, and then moved to manufacturing bay wreath materials in 1989, and by 1992, motorcycle initiates. In 1994, Geely began manufacturing motorcycles. By 1996, Geely had produced over 200,000 motorcycles and scooters. Automobile work started in 1998. Geely began exporting its first cars in 2003. Geely had its IPO on the Hong Kong Stock transmute in 2004. Purchase of Volvo Geely was report to fox approached Ford in mid-2008 just about a possible takeover of Volvo Cars.On October 28, 2009, Geely was named as the favourite(a) buyer of Volvo Cars by Ford. On declination 23, 2009, Ford confirmed t hat all hearty commercial terms for the sale to Geely had been settled. A definitive retainment was signed on March 28, 2010 worth $1. 8 billion, and the bay window was completed on August 2, 2010. solicitude * Executive directors Mr. Li Shu Fu, Mr. Gui Sheng Yue, Mr. Yang Jian, Mr. Ang, Siu Lun, Mr. Yin Da Qing, Mr. Liu Jin Liang, Mr. Zhao Jie, Dr. Zhao Fuquan * zero(prenominal)-Executive DirectorsMr. Xu Gang * Independent Non-executive Directors Mr.Song Lin, Mr. Lee Cheuk Yin, Mr. Yeung Sau Hung * cured Management Mr. Zhang Peng, Mr. Cheung Chung Yan Products * Xiali TJ7300-based * 1998 HQ/Haoqing/Haoqing SRV * 2000 MR/Merrie * 2002 MR/Uliou/MS * 2004 PU/Rural nanny-goat/Urban Nanny * 2002 BL/Beauty Leo hitd/BO * Daewoo-designed * 2005 CK/Freedom Cruiser * 2006 MK/LG/KingKong * 2006 FC/ day-dream * 2008 Geely China Dragon Major activities and achievements * Geelys JI-6360 model was certified by the judicature making Geely the first private companionship qualified to be pr oducing railcars in China. scratch line Chinese gondolamaker present at the Frankfurt travel Show in September 2005. * First Chinese car maker to display at the US Detroit auto show. Winning the Special character Grand Prize for Invention and conception for its Blow-out Monitoring and Brake System (BMBS), a unique safety system respectively developed by Geely. * In Peru, Uruguay and Venezuela, Geely has already started to sell its products. Geely has too entered the Bangladeshi, Cuba, New Zealand, Pakistani, Romanian, Turkish and South Afri sewer car markets. signifier 1 Development in sales, fountain Geely annual report 1998-2009 3. Financial analytic turn overing In the by-line sections Geelys enceinte structure, solvency and liquidity, profitability and interchange eat will be discussed. 3. 1 synopsis of gravid Structure Geely automobile Holdings Limited psychoanalysis of Capital Structure HK$000 2005 2006 2007 2008 2009 L-Tdebt 87000 1318000 Deferred taxati on 8018 37727 some other L-T liabilities 682838 309274 0 1442153 add together L-T liabilities 682838 309274 95018 2797880 Current liabilities 54548 227198 5273470 76378 8907789 jibe liabilities 54548 9 one C36 5582744 171396 11705669 % 6% 46% 68% 3% 62% common pieceholders beauteousness 798080 1030157 2441440 4197862 6375613 minority interests 9013 19769 211760 584619 720907 Total justness capital 798080 1049926 2653200 4782481 7096520 % 94% 54% 32% 97% 38% Total liabilities and throw inliness 852628 1959962 8235944 4953877 18802189 100% 100% 100% 100% 100% These amalgamate financial statements possess been prepargond in accordance with Hong Kong Financial Reporting Standards (HKFRSs) -From common-size analysis, we recognize leverage rate of Geely is stable for year 2006 and 2007, declines sharply for year 2008, and then rebounds potently to 62% in year 2009. whence look at the absolute jimmy, its non backbreaking to find out a great rise in two liability and law capital. In 2009, the get along liability is more than a trilion. Referring to its coronation and ope balancen in recent years, we think Geely is trading on the equity, which indicates it is using equity capital as a acceptance base in a longing to reap excess presents.This mickle be confirmed by its step-by-step science of many assembly line and investiture on new(a)ly factories financed by wed and bank espousal, which is conversely based on increasing equity (stock price stirred by expansion). Those investments be revalued and taken into summation as a new backup. 3. 2 Solvency Analysis Geely Automobile Holdings Limited Solvency Ratios HK$000 2005 2006 2007 2008 2009 D/E symmetry 0. 07 0. 88 2. 29 0. 04 1. 84 lodge in insurance coverage symmetry 7. 66 10. 11 16. 06 15. 46 S-T D/E 0. 22 2. 16 0. 02 1. 0 The computation for Year 2009 is shown here D/E ratio= Total liabilities / Sh atomic number 18holders equity = 2,797,880 / 6,3 75,613 Interest coverage ratio= EBIT / Interest Expense = 1,657686 / 107,226 S-T D/E= long liabilities / Sh beholders Equity = 8,907,789 / 6,375,613 The computation for EBIT is shown below HK$000 2005 2006 2007 2008 2009 pass Profit 115377 214149 318100 866053 1319028 Interest expense 32390 35103 60952 107226 revenue enhancement 1585 1673 51869 231432 EBIT 115377 248124 354876 978874 1657686Since the ratio of debt to equity capital is comparatively steep, we need to take a throw out look of its financial condition. Before assessing long-run solvency we want to be satisfied about the near-term fiancial survival of Geely. Unfortunately, Geelys short(p) term debt to equity ratio is 1. 40, quite game in the around recent year. Although it can ready capital from HK listed market, equity is app arntly non enough to make up its paucity of capital in short term. correspond to NOTE, Geely has discounted notes delinquent to banks in alternate for cash in in with re course in the ordinary course of business.Therefore, the risk resulting from its speeding expansion not only depends on its own performance, only its customers financial distress. Interest coverage ratio is satisfactory, which means payment of the interest liability Geely has incurred on its long-term borrowing is in a less pressure. 3. 2 Analysis of Liquidity Geely Automobile Holdings Limited Analysis of Liquidity HK$000 2005 2006 2007 2008 2009 Industry norm Accounts receivable Turnover 1. 91 0. 95 1. 99 1. 51 2. 29 19. 47 Acid-test ratio 1. 13 0. 68 10. 44 0. 71 1. 19 chronicle overturn 15. 9 11. 10 8. 36 136. 70 393. 17 31. 79 The computations are as follows Accounts cod Turnover = straighten out sales / ordinary accounts receivable Acid-test ratio = Cash and equivalents + merchantable securities + Accounts receivable / Current liabilities storeing turnover = Cost of goods sold / Average Inventory The selected accouts utilize in computation are here HK$000 2005 2006 2007 2008 2009 Sales revenue 101411 127006 137209 4289037 14069225 COGS 90649 110036 121251 3637752 11528489 Inventory 5703 9910 14498 26611 29322 urrent asset 67212 280681 884331 5110552 12219411 up-to-the-minute liability 54548 227198 79559 5273470 8907789 championship and other receivables 44840 59065 65443 2840255 6144929 Dividend receivable 8220 74840 3560 Accounts receivable 53060 133905 69003 2840255 6144929 cash cash equivalents 8449 20972 761684 889408 4498155 Marketable security The accounts receivable turnover is much worse than manufacturing average. However, an attach of accounts receivable may due to rise in sales or difficulty in collecting quite timely.Referring to NOTE, we know that receivables are guaranteed by conventional banks in the PRC and perk up maturities of six months or less. So the likelihood of timely collection is in less question. The fund turnover is exaggeratedly higher(prenominal) than industry take aim, especially afterwards its installment of P-SCM provide chain commission system, which integrates ordering, producing, selling, and distri neverthelessing. So we can conclude that Geely is doing excellence in inventory management and is enjoying a offshoot in market demand of its products 3. Analysis of operational Activities To be able to make a comprehensive analysis of Geelys activities, two the income statement and the balance canvass have been restated in appendix A and B, such that it is possible to identify operate and non-operating income, assets and liabilities. Assumptions regarding classifications are also available in the appendixes. contrive 2 illustration of revenue and operating income, mention Geely annual report 2007 -2009 understand 2 illustrates how dramatic the evolution in especially revenue has been the last trio years.Net sales are up by almost 200 percentage from 2008 to 2009, piece only a 60 percent development in volume is reporte d in the annual report. Mainly the large growth is a result of rich consolidation of the Groups manufacturing Operations. Moreover, the acquisition of Drivetrain Systems at June thirtieth 2009 grantd extra revenue the last one-half year of 2009. Further the notes reveal that 95 percent of sales are at bottom China in 2010, in 2009 it was only 81 percent. A decline in export can in a future growth perspective be a concern.Geely have improved profit adjustment over the last trey years (18 percent In 2009), enchantment the operating margin have been alternatively volatile ( attachment 1). This is caused by large income/expences from share of results of associated companies. It is expected that this account will be less important in the future as some associates now are fully consolidated. A large make up in scattering and selling expenses in 2009 ( summation more than 200 percent) is worth to note. It raises questions as can Geely manage all the new acquisitions without acquir ing less effective and the level of earnings quality.No extraordinary or out-of-the-way are identified in the financial statement. It is a good sign since these accounts much are subject to earnings management. well-rounded income is nicely increasing and no unmatched subjoin in unrealized gains/losings of currency is identified. 3. 4 Analysis of run off on Common Equity This analysis show that the drivers behind the increasing return to common equity is generally due to heavy increase in asset turnover and an equal percentage increase in leverage. The adjusted profit margin has unfortunately been declining severely over the check.Geely is therefore relying on Non-operating activities to reach the growth in ROCE. From a shareholder perspective is an increase in ROCE due to leverage not sustainable. However it must be observe that it was only last year the increase in leverage was heavy, small-arm the increase in asset turnover has been for longer. From a financial dit of view it can be argued that pickings up debt while it is cheap, since the interest rate is shortly low, is in the long run better for the shareholders, if the election was to finance expansion with more valuable equity.What is critical is if Geely is strong enough to relapsing their adjusted profit margin to pass on development thinking(a). 3. 5 Cash string up Analysis It is useful to construct a summary of cash in fly the coops and outflows by study categories because we can evaluate a firms sources and uses of cash from operating, investing and financial backing activities directly. Geely Automobile Holdings LimitedSummary of cash inflows and outflowsYear ended 31 Dec 200X HK$000 2005 2006 2007 2008 2009 TotalOperating activities (7636) (31858) (17747) 550977 948805 1442541 Investing activities 5064 (660806) 247079 (274542) (1305946) (1989151) Financing activities 9452 704988 542943 (148711) 3966382 5075054 Increase( decrease) in cash 6880 12324 772275 127724 360 9241 4528444 Year 2009 cash reinvestment ratio = (operating cashflow-Dividends) / (Gross plant assets+investment+other assets+ working capital) = (948,805- 59,500)/103+(293,697+97,788)+4,185,892+3,311,622) = 11. 27%The summary of cash flow chart shows that during fiscal year 20052007 Geely undergo negative operating cash flow. anyhow that it has used cash to finance increase in inventory and receivables, the Share of results of associates opposite profits onwards tax from a controlling place to a throwback one as it contributes more than 100% negatively in the beginning 2008 to Geelys profit after tax. This may be due to its format of growth since check capital expenditures by its operating associates amounts to approximately RMB1 billion, which are mainly funded by the operational cash flow generated by associates.The in enough operating cashflow part is made up by financing activities through issuing debt and securities and borrowing from banks. From fiscal year 2008 Gee ly was able to begin generate coercive operating cashflow . However, positive operating cashflow may due to the decrease in its working capital. The cash flow statement shows that payables decreased significantly after 2008, which raises incertitude on a possibility that Geely slow down payments to suppliers until its operating cash flow before adjustment of working capital fetch healthier.The study cash outlay is investing activities, corresponding to its funding for the query and development of new vehicle models, new engines and gearboxes, the reflexion and expansion of plants. Concerning financing activities, one point should be mentioned here is that Geely borrows with its receivables as collateral, the inflow of cash is reported as a financing activity in the cash flow statement. The second doubt come up when comparing with income statement.Earnings are significantly exceeding operating cashflow, this may be an indication of aggressive accounting choices, such as reco gnizing revenues too soon or delaying the recognition of expenses. Take a look at the free cash flow statement. From free cash flow to equity (FCFE) we know the cash flow availabel for distribution to common shareholders is sufficient. Along with its satisfactory reinvestment ratio, Geely proves that it is taking maintenance of investors. Geely automobile Holdings LimitedFree cash flow statementYear ended 31 Dec 200X HK$000 2006 2007 2008 2009Net income 214149 305767 866053 1319028 Depreciation 1403 2282 141053 364598 intereset expense 32390 35103 60952 107226 net capital expenditure 99304. 87 93000 113990 113443 working capital investment 53483 804772 -162918 3311622 FCFF 95154. 13 -554620 1116986 -1634213 Net borrowing 716000 330000 1061000 4300000 FCFE 584837 219253 1497987 5135362 net capital expenditure = approximate expenditure in RMB* rate of exchange prevailing at the balance sheet date 4. 0 SWOT analysis of Geely Automobile Strengths 1.Continuously Increasing Revenue Geelys gross profit margin has proceed to grow over the past few years due to successful order expansion and increasing market shares. The nitty-gritty sales for various kinds of Geely vehicles has accumulated to over 800,000 since 2001, and the Geely trademark has been recognized as a well-known mark in China. It has established over 200 sales assist bases overseas, and performed SKD/CKD assembly production and sales in Ukraine, Russia and Indonesia and other countries. 2. Emphasis on seek Development CapabilitiesBy the end of 2009, Geely owns a total of 1,600 engine room patents. Geely has a professional seek and development squad, the staff number of which exceeds 1,400, representing 12% of the total staff of the Group With its all-encompassing investment in research and development, the chemical groups RD team is capable of launching four to tailfin new models every year, reflecting its leading put in RD and engine room innovation capabilities in Chinas automobile s ector. 3. Acquisition of Volvo and Enhanced putting green TechnologyNew energy-powered vehicle is the latest trend and it will be the future of the worlds auto industry. Ford and Volvo have already invested millions of dollars over the past decade in terms of new energy technology. acquiring Volvo may enhance Geelys technology in new energy-powered vehicle area, protagonist Geely take a step introductory in competing with other homegrown suckers, and surface the way for Geely to enter the global auto market. Weaknesses 1. Accounts Receivables Worse than Industry average Geelys average turnover ratio of accounts receivables from 2005 to 2009 is 1. 3, which is easily inflict than the industry average, 19. 47. Although the previous analysis has shown less possibilities of payment collection problem, a low accounts receivable turnover ratio compose indicates that there is an opportunity exist of holding receivables for a longer period of time. 2. Image of Lower-end Brand Altho ugh Geely has a well-established sales network and growing competence in core technology, it is hard for Geely to alter its lower-end brand image, since its original target market is low cost vehicle.But branding is about value and perceived quality, so price but can never allay a victory. Enhancing quality and ensuring that its cars are on par with the global leading brands are still a major challenge for Geely. 3. little Advanced Technology Despite the vast amount of investment in research and development, capital and talents for automobile core technology are limited, and it is hard for Geely to compete with the travel technology of abroad automobile manufacturers. 4. unsatisfactory Sales in Export Markets Motor vehicles sales in most separate of the world market remains fragile.As a result, Geely exports business could continue to face major challenges given the fierce contention and the short history of operation in its major export markets. Opportunities 1. Continuous Gr owth of China Sedan Market Chinas passenger vehicle market ended last year with a 59 percent year-on-year sales increase to surpass the United States as the worlds largest auto market for the first year. concord to estimate of Goldman Sachs Global ECS research report, growth in China car market will be remained for the next 10 years and the industry GDP growth will be 11. % in 2010 and 10% in 2011. Goldman Sachs Global ECS research teams forecasts that China will further boost its No. 1 position in the car market with sales reaching 30 million units per year by 2020. 2. political science Policy Support In the past few years, the focus of Chinese government policies for automobile industry is to boost sustainable growth in the delivery with auto industry as one of its pillars and to support home(prenominal)ated participants and industry consolidation. Threats 1.Fierce Competition from both(prenominal) Domestic and Foreign Brand The considerable profit potential of China car mar ket brings about fierce competition among both local and foreign automobile manufacturers. In the luxury automobile market, foreign manufacturers are in leader position due to their sophisticated technology and high brand recognition. While in lower end automobile market, local brands are strong competitors. 2. Possibility of Over cleverness in China Auto Market Some industrial experts concern that Chinas market may one day face vercapacity problems. A report from the official news portal of Chinas eastern Zhejiang province showed that, based on the production plan of Chinas 12 major auto manufacturers for the next five years, Chinas auto production would reach 32. 5 million units in 2015, far exceeding the forecast of 22 million units in the blue entertain of Chinas automobile industry. If Overcapacity problems occur, serious overproduction capacity will lead to negative market competitiveness a loss in enterprise efficiency, factory stoppages and other problems. . 0 Analyses of management discussion and psychoanalysts opinion Appendix C summarizes some psychoanalysts view of Geely. However, not all analysts agree upon whether you should sell, hold or buy the stock. several(prenominal) reasons are discussed in the respective reports though all analysts agree that Geely is a hearty company with a stable revenue base, increasing volume and satisfactory margins. What analysts do not agree upon is whether Geely can affirm their growth potential and gain market share in both the domesticated and export market.The penetration in the Chinese passenger car market is highly low compared to USA and Europe (JP Morgan, 2010) and as the Chinese people are getting wealthier the market potential will increase the upcoming years. Loads of Automobile manufacturer will compete to gain market share and earn extraordinary profit. cite Suisse and CIMB are representing the negative analysts who believe that domestic market competition will increase as the nearest competitor s have invested heavily in the industry and developing of new brands (CIMB, 2010).Geely Management has not commented upon this in their report, but instead they emphasize they have sufficient funds to cover investments and R&D expenses to facilitate their own growth. Additionally, credit Suisse (2010) emphasize that every auto manufacturer in the Chinese market are currently investing in production facilities. Credit Suisse is therefore worried it will result in an oversupply and consequently make inventories to rice. To bring inventories down a price war on vehicles can arise. This will affect margins negatively.JP Morgan represents a positive analyst that strongly believe that the current acquisition of Volvo will result in synergism effects and a technology program that no one else can simulate in the near future. Further JP Morgan is surefooted that the low penetration of vehicles in the domestic market will ensure future growth, and therefore recommends buying the stock. D BS, Deutche Bank and Yuanta are recommending holding the stock, since they believe there are too many uncertainties connected to Geely and the future. specially they all emphasize the lack of a clear growth catalyst to overcome the market.Further, the acquisition of Volvo seems to have longer prospects before profiting than expected at first hand (CIMP, 2010). As expected Geelys management discussion is very positive towards the future and leaves the shareholders with the impression of a highly growing company with a salutary economy and a clear defined strategy, although it is sight that very little space is used to comment upon the current competition in the market. Instead Geely Management has chosen to focus at their new strategical weapons platform and how they can develop brands and product lines into a competitive advantage (Geely, 2010).It can be interpreted as an indirectly order to cope with the market competition without discussing the spot in detail. Shareholders , however, must be certain of this matter when evaluating the business. Even though current revenue is increasing heavily one must consider how sustainable this growth rate is in the future. It can be concluded that Geely Management are moderately taking a too positive approach towards the current market conditions, since these are not discussed in depth and analysts report emphasize different issues than Geely.This analysis facilitate that there are no ordinary result to trading with stocks. We all wants to buy the stocks that are undervalued and sell the ones that are overvalued, and the answer you get depends on the method, forecast and strategic mindset of the analyst. Geely is without doubt a healthy company so the buy, held, sell close lies within how you value the growth opportunities, how Geely can facilitate R&D and mechanism acquisitions and thereby benefit from synergies. 6. 0 RecommendationGeely have the recent years had an expansion strategy, and as a consequence a high level of investment. This has resulted in a higher leverage and that earnings significantly are exceeding cash flows. However this is also a natural picture of a company in an expansion phase. It is imbed that Geely has satisfactory interest rate coverage even though leverage is increasing. Furthermore, accounts receivables is found worse than industry average, but good bank agreements make it easy for Geely to rival liquidity issues. Inventory turnover is also good, as the focus on SCM systems have proven its worth.This is moreover expressed in the increase asset turnover which partly is the driver behind the increasing ROCE. However it is important to note that the adjusted profit margin is declining. The overall performance shows increased revenue/earnings, but it is very difficult to determine the earnings quality since most of the rise is due to consolidation and acquisitions. The positive free cash flow and satisfactory reinvestment ratio shows that Geely are taking care of investors. SWOT analysis identifies possible business catalyst as R&D and the new acquisition of Volvo that could create synergy effect.It is our opinion that these business drivers are rather uncertain but is very believably to succeed and combined with Geelys current healthy financial situation we are taking a positive approach towards Geely and recommends to buy the stock. 7. 0 Bibliography Geely Automile Holdings Annual report 2005-2009 enthronement Reports DBS (8. June2010) Hong Kong/ China Company Focus Geely Automobiles Holding DBS Vickers Securities Analyst Miu, Rachel Credit Suisse (12. July 2010) Asian periodic Geely Auto Credit Suisse Analysis Analyst HungBin Toh CIMB (28. Sep. 010) Geely Automiles Holding LTD CIMB Reasearch Analyst Cheam, The Shen JP Morgan (26. Sep. 2010 ) Geely Automiles Holding LTD Initiating Coverage, JP Morgan Asia peace-loving Equity Research Analyst by Li, Frank Deutche Bank (26. Aug. 2010) Geely Automiles Holding LTD Deutche Securit ies Asia LTD Analyst Ha, Vincent Yuanta (26. Aug. 2010) Geely Automiles Holding LTD Yuata Research Analyst Wong, knot Websites Reuters (http//www. reuters. com/finance/stocks/analyst? symbol=0175. HK) Appendix A Restated income statement Appendix B Restated Balance SheetAppendix C Overview of Analysts opinion Source Reuters (http//www. reuters. com/finance/stocks/analyst? symbol=0175. HK) 2 . Industry average figure origin http// www. stats. gov. cn 3 . Property, plant and equipment are depreciated on a straight-line basis at the following rates per 4 . Goldman Sachs, China Automobiles, whitethorn 19, 2010 5 . Business Monitor International, BMI China Autos Report 2010, November 2009 6 . Global Times, Chinas Expanding Auto Production Triggers Overcapacity Concerns, July 19 2010