CAM Study: Electric Cars Reduce Manufacturers' Profits

The weak sales of electric vehicles have, according to a study, impacted the profits of international car manufacturers at the start of the year. For ten selected companies, the quarterly profit before interest and taxes (Ebit) fell on average to 7.1% of sales, as compiled in a study presented by the research institute Center of Automotive Management (CAM) on Tuesday. In the three years prior, this operating margin had averaged between 8.3% and 8.4%. The average profit (Ebit) per car decreased by 19% to 2253 euros. 

Interest Rates and Geopolitical Uncertainties Hamper Business

In addition to the difficult market ramp-up for electric vehicles, high interest rates and geopolitical uncertainties also made business more challenging. A year earlier, manufacturers could still afford to primarily produce higher-priced and high-margin vehicles, while demand increasingly normalized in 2024.

German Premium Manufacturers Remain the Most Profitable

The most profitable remain the German premium manufacturers BMW and Mercedes-Benz with margins of 11.1% and 10.8%, respectively. The best volume manufacturer was Toyota with an operating margin of 10.0%. Volkswagen achieved only 6.1%, narrowly ahead of Hyundai (5.8%) and Honda (5.6%). The electric specialists Tesla (5.5%) and BYD (4.6%) earned below average due to the tough price competition in their sector. The highly profitable Stellantis group has not reported quarterly figures.