The world’s largest car manufacturers have recently suffered a drop in profitability, according to a study by consulting firm E, according to dpa-AFX.
Compared to the same period last year, according to the analysis, sales rose by about 19 percent in the first quarter of the year, but earnings before interest and taxes (Ebit) lagged behind with a 6.1 percent increase. Sales were up just four percent.
Profitability – measured by the Ebit margin, which expresses operating profit in relation to sales – fell from nine percent to eight percent. The new margin leader among the 16 automakers analyzed was Mercedes-Benz of Stuttgart, with an Ebit margin of 14.7%. It was followed by BMW (14.6 percent) and Kia (12.1 percent).
First time
Former leader, electric car maker Tesla, landed in fourth place with 11.4 percent.
“For the first time since the beginning of 2021, we are seeing clear signs of slippage in profits, which have long since stopped growing as fast as sales,” Constantin Gall, head of EY’s Western Europe mobility division, said in a communicated. The market is normalizing, he added. “A new car will soon no longer be the limited commodity of last year,” Gall said. As a result, he said, it will become increasingly difficult for automakers to overcome high vehicle prices in the market and forgo discounts. “The time of dream margins will soon be over for some companies.”
In addition, most manufacturers currently make significantly higher profits on internal combustion vehicles than on electric vehicles, said EY industry consultant Peter Fuß. Manufacturers need to be able to make electric cars more efficient, he said. And: “There is no way to avoid greater cost discipline, otherwise there is a permanent threat of significantly lower profitability
