China’s Geely Automobile Holdings said on Wednesday that first-half net profit slid 40 percent year-on-year amid a sustained downturn in the world’s biggest auto market, and it forecast an uncertain outlook for vehicle demand for the rest of the year.

Geely, China’s highest-profile carmaker globally thanks to the group’s investments in Volvo and Daimler, posted net profit of 4.01 billion yuan ($568.5 million).

UOB analyst Kenneth Lee had forecast Geely would report a 4.78 billion yuan profit for the period, according to Refinitiv data.

Profit in the first half “was negatively affected by higher discounts and incentives to reduce dealers’ inventories ahead of the official implementation” of new emission standards in some areas, Geely said in the filing, referring to a stricter vehicle emissions standard that China implemented in July.

First-half revenue was 47.56 billion yuan, down from 53.71 billion yuan a year earlier, and first-half sales fell 15 percent to 651,680 vehicles.

Retail sales volume, however, recorded “a mild y-o-y growth” during the same period, Geely said, adding it plans to launch at least eight new or revamped models in the next 12 months.

China’s overall vehicle sales fell 4.3 percent in July, down for the 13th consecutive month, according to the China Association of Automobile Manufacturers (CAAM).

Sales of new-energy vehicles (NEVs), a category that includes both hybrid and purely electric cars, declined by 4.7 percent year-on-year in July to 80,000 vehicles, compared with the growth of 80 percent in NEV sales in June, CAAM data showed.

Although the Chinese government has started to introduce measures to stimulate automobile demand, the market has shown little sign of improvement. 

Recently, the China-US trade dispute appears to have worsened further, resulting in more uncertainty for passenger vehicle demand in China in the remainder of the year, the filing said.

In July, Geely cut its sales target for the year to 1.36 million units from 1.51 million, seeking to reduce dealers’ inventories amid uncertainty in the overall car market.

Geely sold 1.5 million cars last year, up 20 percent year-on-year.