New Energy Automakers Struggle with Profits as Battery Makers Reap Biggest Gains

Amid fierce competition in the new energy vehicle (NEV) market, automakers are普遍 struggling to turn a profit, while battery manufacturers are reaping massive gains. In 2025, CATL reported revenue of RMB 423.7 billion and net profit of RMB 72.2 billion—equating to an average daily net profit of RMB 2 billion. By comparison, BYD, the most profitable automaker, earned just over RMB 30 billion in net profit for the year, while newer entrants like Li Auto, Leapmotor, and Xiaomi each made less in annual profit than CATL did in a single week. GAC Group–backed SVOLT generated RMB 44.4 billion in revenue and over RMB 2 billion in net profit in 2025, while GAC itself posted a net loss of RMB 9.8 billion. Guoxuan High-Tech reported net profit of RMB 2.5 billion in the first three quarters alone—far exceeding its client Leapmotor’s full-year net profit of RMB 540 million. Although automakers have been actively pursuing a “de-CATL” strategy by diversifying their battery supplier base to reduce reliance on the dominant player, cost pressures remain unabated. Compounded by intense price wars and high R&D expenditures, automakers’ profit margins continue to shrink. Experts suggest that automakers must refocus on product quality and brand fundamentals and break free from the cycle of cost-driven competition to find a way out.