Global automakers grapple with profitability woes; China’s EV transition faces pressure but holds first-mover advantage

Lu Fang, Chairman of Voyah Automobile Technology Co., Ltd., stated that while public attention is currently focused on the profitability challenges facing Chinese new energy vehicle (NEV) companies, global mainstream automakers—including Volkswagen, Toyota, and Stellantis—are also grappling with similar profit pressures amid a backdrop of intensified competition in a saturated global auto market and the ongoing transition to electrification. He emphasized that profitability is a prerequisite for companies to continuously create value for users and society, and it represents a shared challenge across the global automotive industry. Lu noted that although China’s auto industry faces fierce competition and significant profit margin pressure, it has gained an early start in areas such as electrification and intelligent driving, accumulating substantial technological expertise and experience, and achieving localized competitive advantages. He believes that companies confronting transformation challenges head-on are more likely to pioneer breakthrough solutions. According to relevant data, Volkswagen Anhui—a joint venture of JAC Motors—has incurred cumulative losses exceeding RMB 10 billion from 2023 to 2025. Meanwhile, Stellantis Group reported in its full-year financial results released in February 2025 a net loss of €22.3 billion (approximately RMB 178.674 billion), primarily due to €25.4 billion in charges stemming from strategic realignments and changes in the regulatory environment. This marks the first annual loss in the company's history.