New Energy Vehicles (NEVs) in China
- Thread starter supercat
- Start date
Just to put things in perspective, CATL posted $10.7B in profits in 2025. This is more than 2x higher than the combined profits of the major EU Tier-1 auto suppliers (Bosch + ZF + Continental + Valeo + Forvia + Aptiv) last year, which was only $4.5B.
Also notable, CATL profits surpassed VW for the first time
This is a major narrative violation for the pundits who complain about involution and that Chinese companies make no money.
VW still makes more money than most autogroups. Stellantis lost something like 20 billion last year. Only Toyota is doing well among the legacy OEMs.
And speaking of VW, they announced that they were going to lay off 50,000 workers just in the past few days. We are still not at the point when major Western OEMs will either go bankrupt or be folded/merged, but that will inevitably have to happen. The global automarket is not growing much and there are too many companies out there. The cost structures are simply too high and the pace of innovation too low.
The global EV shift is still something many of these companies are in denial about. And they've spent more time trying to lobby governments to raise tariffs or outright ban Chinese competition rather than embrace change.
European firms will have to merge or at least create deep alliances with Chinese companies to survive and you are seeing this strategy play out slowly already. I'm less sanguine about the US Detroit legacy OEMs. They may survive but mostly as niche automakers creating gasguzzling pickup-trucks for a highly protected and overpriced US market.
And speaking of VW, they announced that they were going to lay off 50,000 workers just in the past few days. We are still not at the point when major Western OEMs will either go bankrupt or be folded/merged, but that will inevitably have to happen. The global automarket is not growing much and there are too many companies out there. The cost structures are simply too high and the pace of innovation too low.
The global EV shift is still something many of these companies are in denial about. And they've spent more time trying to lobby governments to raise tariffs or outright ban Chinese competition rather than embrace change.
European firms will have to merge or at least create deep alliances with Chinese companies to survive and you are seeing this strategy play out slowly already. I'm less sanguine about the US Detroit legacy OEMs. They may survive but mostly as niche automakers creating gasguzzling pickup-trucks for a highly protected and overpriced US market.
BYD domestic sales fell -65% YoY while exports grew 50% in feb 2026.
I'm seeing folks blame the timing of the CNY, but it cannot be that large of a calender effect. BYD is at six straight months of domestic sales decline. It's funny to me that even as Chinese customers are turning their backs on BYD, the company is doing better than ever abroad.
China exported 1.5 million cars in the first two months of 2026. We won't know the exact breakdown of EV vs ICE until later, but it was huge YoY growth. Expect to hear more dreary talk about "Chinese overcapacity".
I'm seeing folks blame the timing of the CNY, but it cannot be that large of a calender effect. BYD is at six straight months of domestic sales decline. It's funny to me that even as Chinese customers are turning their backs on BYD, the company is doing better than ever abroad.
China exported 1.5 million cars in the first two months of 2026. We won't know the exact breakdown of EV vs ICE until later, but it was huge YoY growth. Expect to hear more dreary talk about "Chinese overcapacity".
Porsche look like a dead horse now.
Porsche profit plummets by 98% in 2025. Operating profit is down to just €90 million – compared to €5.3 billion in 2024.
VW needs to produce Porsche in China for the Chinese market.
So you think the solution of Porsche building cars that Chinese people don’t want is to build cars Chinese people don’t want in China? Their problem is that their big money makers like Macan are not competitive enough. They are fine for North America, Europe, but it’s just not enough vs a Yu7.
Honda EVs have just bit the dust
not only that, but Honda posted a financial loss.