Cango Inc. (NYSE:CANG) Q1 2024 Earnings Conference Call June 12, 2024 9:00 AM ET
Company Participants
Jiayuan Lin - CEO
Yongyi Zhang - CFO
Conference Call Participants
Pingyue Wu - Citic Securities
Operator
Good morning, and good evening, everyone. Welcome to Cango Inc.'s First Quarter 2024 Earnings Conference Call. [Operator Instructions] This call is also being broadcast live on the company's IR website.
Joining us today are Mr. Jiayuan Lin, Chief Executive Officer; and Mr. Yongyi Zhang, Chief Financial Officer of the company. Following management's prepared remarks, we will conduct the Q&A session. Before we begin, I refer you to the safe harbor statement in the company's earnings release, which also applies to the conference call today as management will be making forward-looking statements.
With that said, I'm now turning the call over to Mr. Jiayuan Lin, CEO of Cango. Please go ahead, sir.
Jiayuan Lin
[Foreign Language] Good morning, everyone, and welcome to Cango's first quarter 2024 earnings call.
China's GDP maintained moderate growth in Q1 2024, increasing by 5.3% year-on-year despite a complex global economic environment. According to the China Association of Automobile Manufacturers, the auto industry also saw strong growth with production and sales reaching 6.61 million and 6.7 million vehicles, respectively. This represents a year-on-year increase of 6.4% for production and 10.6% for sales. New energy vehicles or NEVs in short with a particular bright spot.
Production and sales surged by 28.2% and 31.8% year-on-year to 2.12 million and 2.09 million units, respectively. This strong performance pushed NEV's market share to over 30%. Despite positive growth in vehicle production and sales, the auto market faces challenges on both the supply side and demand side, traditional automakers must transform to compete in a new energy vehicle era and emerging NEV manufacturers face intense competition and struggle for profitability.
On the demand side, slow income growth and job market instability restricting consumer purchasing propensity, rapid technological advancements and price competition lead consumers to delay purchases further tightening the market. In response to the oversupply in the new car market, we took proactive steps to manage inventory and reduce costs.
We strategically reduced the scale of our self-operated new car business and streamlined purchasing processes to improve efficiency and improve inventory management to mitigate the risk of decline in new car prices. While this strategy resulted in a lower revenue compared to last year, that is RMB 64.4 million in Q1 this year, it ensured profitability for the company. Our operating profit was RMB 74.15 million, and net profit was RMB 90.03 million.