Automakers Are Selling More Cars Than Ever. But They're Making Less Money

Since January, automakers have sold 37.6 million vehicles—but net profits actually plummeted by 69 percent.

Photo by: Jeff Perez / Motor1

By: Juan Felipe Munoz

Translated by: Anthony Alaniz

Oct 3, 2025 at 12:00pm ET

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In the first half of 2025, global car sales increased compared to the same period in 2024. The 34 companies analyzed sold 37.6 million units, marking a 3 percent rise. This growth was driven by Toyota, BYD, and Geely, which offset declines from Stellantis and Tesla.

However, despite the higher sales volume, total revenue fell to $1.4 trillion—a 2 percent decrease year-over-year. As a result, the average price per unit dropped from $38,084 to $36,074.

Although most Chinese manufacturers were not included in the analysis, China’s ongoing price war helps explain the decline in average prices. BYD and Geely increased their volumes by 33 percent and 47 percent, respectively, but BYD’s revenue grew by only 14 percent, and Geely’s remained flat.

Notably, BYD ranked as the sixth-largest global automaker by volume in the first half of 2025.

Profits Down By 23 Percent

Even more concerning for the sector is the sharp decline in profitability. A combination of factors—including the ongoing price war in China, stagnant global demand, rising costs in Europe, trade disruptions, and uncertainty stemming from tariffs imposed by US President Donald Trump—has significantly impacted the industry.

Operating profits (gross profit minus selling and administrative expenses) dropped by 23 percent, falling to $122.2 billion. Among major manufacturers, the steepest declines were recorded by Stellantis and Nissan, followed by Mercedes, Ford, Tesla, Volkswagen, BMW, Honda, and Kia.

Top 5 Brands for Revenue Increase

First half of 2024 compared to the first half of 2025

	Revenue (In Billions)	Vs H1 2024	Units Sold	Vs H1 2024
Leapmotor	$3.38	+154%	222,000	+156%
Xpeng	$4.76	+115%	197,000	+279%
Polestar	$1.42	+43%	30,300	+51%
Lucid	$0.49	+21%	6,4	+47%
BYD	$51.58	+14%	2,146,000	+33%
Total*	$1.36	-2%	37,605,000	+3%

*34 OEM manufacturers

An Uncertain Future

Even more dramatic was the collapse in net profits, which fell to $26.6 billion—a 69 percent drop compared to 2024. As a result, the average net margin declined from 6.1 percent to just 2.0 percent in a single year. This sharp decline reflects the broader climate of uncertainty affecting both Western and Chinese automakers.

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Without more flexible regulation in Europe, clearer trade policies in the U.S., and an end to the price war in China, the sector’s outlook remains highly uncertain. Only three manufacturers managed to grow their net profits: Suzuki (+9%), Ferrari (+9%), and BYD (+2%).