Two of China's top automakers posted forecast-beating earnings on Wednesday but will struggle to match that performance amid a murky outlook for the world's biggest auto market.
After a bull-run in 2009, car sales in China started to lose steam in May and flagged further in the following months as Beijing applied the brakes to stop its economy from overheating.
A slowing economy and last year's high comparative base also make it difficult for anyone to match the runaway sales growth a year-ago in the second half, said Zhang Xin, an analyst with Guotai Junan Securities.
SAIC Motor Corp warned of uncertainties ahead, including economic worries, but also said it expects a boost from Beijing's incentives for car buyers, which remain effective until the end of the year.
From April to June, the company booked 3 billion yuan ($441.4 million) net profit, its biggest quarterly earnings and just ahead of a forecast of 2.9 billion.
Geely Automobile Holdings posted a record 804.85 million yuan net profit for the first six months, up 35 percent from a year earlier.
Both SAIC chairman Hu Maoyuan and Geely Chairman Li Shufu, whose privately owned Zhejiang Geely bought Ford's Volvo car unit this month, are confident their companies will hit 2010 sales targets, based largely on a solid first half.
Hu assured shareholders recently that the Shanghai-based automaker can sell 3 million vehicles for the full year, while Li said on Wednesday that the company will reach its target of 400,000 units, up 22 percent from year earlier.
Such results would set SAIC and Geely apart from Warren Buffett-backed BYD, which recently slashed its 2010 sales target by 25 percent.
SAIC, which runs vehicle manufacturing ventures with General Motors and Volkswagen, is holding up relatively well due to its partners' aggressive push for new models, analysts said.
Its broad portfolio, which includes sedans, trucks, buses, SUV, MPV and mini-vans, also makes it more resilient than peers that make cars only, such as BYD.
SAIC sold 24.6 percent more vehicles in July, its slowest monthly gain so far this year but still far better than the overall market's 14.4 percent rise.
Geely's July sales fell 12 percent but rose 42 percent in the first half to 195,743 units thanks to its continuing efforts to shed its image as the maker of China's cheapest car.
If Geely's parent, Zhejiang Geely, can turn Volvo around, it could allow Geely to benefit from technology transfers and eventually take over the premium brand, said Steve Man, an analyst at Samsung Securities.
Before the results, SAIC shares, traded in Shanghai, closed down 2.56 percent at 15.6 yuan, better than a 2.03 percent fall of the benchmark index. The stock has dropped 22.4 percent so far this year.
Hong Kong-listed Geely ended the day unchanged at HK$2.61. The stock has plunged 39 percent so far this year, lagging a 6 percent slip of the Hang Seng Index.
(Editing by David Cowell)