Under multiple pressures such as the ongoing price war and rising raw material prices, the profit margins of China's automotive industry are sliding towards historical lows. Recently, according to data released by Cui Dongshu, Secretary General of the National Passenger Car Market Information Joint Committee, the sales profit margin of the automotive industry in the first quarter of 2026 has dropped to 3.2%, a year-on-year decrease of 18%; In the previous months of January and February, this number was as low as 2.9%, hitting a new low in nearly a decade.

Under the chill of the industry, the overall financial data of car companies in the first quarter is under pressure. Among the 13 listed car companies that have laid out their passenger car business according to the Economic Observer, 5 have experienced a decline in revenue. On the profit side, 5 companies experienced a decline in profits, while another 5 suffered losses. Only 3 companies achieved year-on-year profit growth, with two of them increasing by less than 1%. At the level of net profit margin, the overall level remains low, with only two companies above 5% and most below 3%.

However, even as the overall environment weakens, the profitability of different car companies still varies significantly: some have gross profit margins exceeding 15% or even 20%, while others are only in single digits or even negative.

Top concentration: Four car companies contribute the vast majority of industry profits

In the first quarter, although SAIC Group and Geely Automobile surpassed BYD in sales, BYD still led the way with a revenue of 150.23 billion yuan. However, compared with the same period last year, BYD's revenue and profit have both shown a significant decline, with revenue down 12% and net profit down 55.4% to 4.085 billion yuan. The main reason behind this is the adjustment of the new energy purchase tax policy and the intensification of industry competition, which has led to a decline in sales and profitability. Data shows that BYD sold 700000 vehicles in the first quarter, a year-on-year decrease of 30%; The gross profit margin for the first quarter was 18.8%, which is at the forefront of the market but still lower than the 20.1% of the same period last year.

SAIC Group benefited from the rebound in sales in the first quarter and improved performance. Its first quarter operating revenue was 138.5 billion yuan, an increase of 0.61%; Net profit was 3.03 billion yuan, an increase of 0.09%. In 2024, SAIC Group's net profit attributable to the parent company experienced a significant decline of 88.19%, but rebounded in 2025 and maintained an upward trend in the first quarter of this year. The gross profit margin of SAIC Group in the first quarter was 12.83%, an increase of 4.7 percentage points year-on-year, with domestic brands and overseas markets becoming the main growth drivers.

Geely Automobile, on the other hand, increases revenue without increasing profits. Its first quarter operating revenue was 83.776 billion yuan, a year-on-year increase of 15%; But the profit was 4.166 billion yuan, a year-on-year decrease of 27%. Geely Automobile explained that this is mainly due to the impact of foreign exchange fluctuations. According to financial report data, the company incurred a loss of 497 million yuan in foreign exchange in the first quarter, compared to a profit of 3.028 billion yuan in the same period last year. Geely Automobile emphasized that the company's core business profit was 4.56 billion yuan, with a growth rate higher than the revenue growth rate, indicating an improvement in operational efficiency and profitability. The gross profit margin of Geely Automobile in the first quarter was 17.5%, achieving year-on-year growth.

Chery Automobile became the "dark horse" in the first quarter. In the first quarter, its operating revenue was 68.57 billion yuan, a year-on-year decrease of 3.45%, but its net profit reached 4.17 billion yuan. Although there was also a decline, it ranked first among 13 enterprises. It is worth noting that Chery Automobile's net profit margin is as high as 6.3%, the highest among statistical enterprises, and is one of only two companies with a net profit margin exceeding 5%, along with Geely (5%). The industry believes that Chery Automobile's high profit margin is mainly due to its good performance in overseas markets. In the first quarter of this year, Chery Automobile sold 600000 vehicles, of which overseas export sales reached 393000 vehicles, a year-on-year increase of 53.9%, accounting for 65.5% of total sales. Compared to the extremely competitive market environment in China, the profit margins in overseas markets are generally higher.

Overall, the concentration effect of the top players in the automotive industry was very significant in the first quarter. BYD, SAIC Group, Geely Automobile, and Chery Automobile, the four car companies, had a total net profit of 15.45 billion yuan in the first quarter, while the 13 companies had a total profit of 15.59 billion yuan.

From the perspective of gross profit margin indicators, Sylphy ranks first with 26.24%, making it the car company that appears to be the "best at selling cars and making money" on the surface. In the first quarter, its operating revenue was 25.75 billion yuan, a year-on-year increase of 35%, and its net profit was 750 million yuan, a year-on-year increase of 0.89%. The high gross profit margin of Sailis is due to its rapid sales growth, and its main sales models are concentrated in the high price range of 300000 yuan and above. In the first quarter, Sailis sold 78500 vehicles, a year-on-year increase of 43.9%. However, it is worth noting that the non recurring net profit of Sailis in the first quarter was only 103 million yuan, a significant decrease of 74% year-on-year. Xilis stated that this is mainly due to the continuous increase in R&D investment, with R&D expenses increasing by 743 million yuan compared to the same period last year. But at the same time, it can be seen that the government subsidies included in the current period's profit and loss for Silis in the first quarter reached 630 million yuan, accounting for 84% of the net profit.

In addition, among profitable car companies, the gross profit margins of Changan Automobile and Great Wall Motors have also increased year-on-year, reflecting an improvement in product structure.

Low profits and losses: multiple car companies are dragged down by foreign exchange

Among enterprises that achieve a positive profit margin, Changan Automobile has the lowest net profit margin, only 1.1%. Changan Automobile's first quarter revenue was 32.7 billion yuan, a year-on-year decrease of 4.26%; The net profit was only 350 million yuan, a year-on-year decrease of 74%. On the one hand, its market sales decreased by 20.9% year-on-year to 560000 vehicles. On the other hand, similar to the situation faced by Geely Automobile, Changan Automobile is affected by exchange rate fluctuations, resulting in a decrease in its foreign exchange earnings. According to the financial report, Changan Automobile's financial expenses in the first quarter were 314 million yuan, while its revenue in the fourth quarter of last year was 1.07 billion yuan, with a difference of over 1.3 billion yuan.

According to the Economic Observer, in the first quarter, exchange losses have become a "hidden killer" eroding the profits of listed car companies. Since April 2025, the Chinese yuan has started a new round of appreciation, and the profit and loss statements of export enterprises have generally been affected by exchange rate shocks. The so-called exchange loss, for example: a car company sells $1 billion worth of goods overseas, agrees to receive payment three months later, and the accounting exchange rate is 7.00 (recorded as revenue of 7 billion RMB). But three months later, the Chinese yuan appreciated to 6.85, and the book value of accounts receivable became 6.85 billion yuan, evaporating 150 million yuan, which was included in the current financial expenses as exchange losses.

Except for Geely Automobile and Changan Automobile, Guangzhou Automobile Group, Great Wall Motors, Jianghuai Automobile and others all mentioned exchange losses in their financial reports. For example, although Great Wall Motors' revenue increased by 12% and gross profit margin rose to 18.45% in the first quarter, its net profit declined by 46%. It stated that the company had high exchange gains in the same period last year and did not receive such dividends in this period; BYD has also experienced a shift from positive to negative foreign exchange rates: exchange gains of about 2.1 billion yuan in the same period last year turned into exchange losses of about 2.1 billion yuan in the first quarter of this year. This alone has caused a drag on profits of about 4 billion yuan, directly leading to a significant decline in net profit.

Guangzhou Automobile Group also increased revenue without profit due to exchange losses. Its first quarter operating revenue was 20.04 billion yuan, a year-on-year increase of 1.98%, but the net loss was 656 million yuan. Guangzhou Automobile Group pointed out that one of the reasons for the losses was the exchange rate fluctuations, which resulted in exchange losses in the current period, while the same period last year was exchange gains. However, Guangzhou Automobile Group has shown signs of overall improvement in performance: it sold 380000 vehicles in the first quarter, a year-on-year increase of 2.38%; In terms of finance, the first quarter loss has narrowed, and both sales expenses and management expenses have decreased year-on-year.

Jianghuai Automobile was also impacted by foreign exchange losses, with a first quarter operating revenue of 9.04 billion yuan, a year-on-year increase of 13%, but a loss of over 600 million yuan, expanding the loss by 172%. Regarding this, Jianghuai Automobile stated that the main reasons for the decrease were the exchange rate fluctuations during the reporting period, which led to a reduction in exchange gains, as well as a year-on-year decrease in investment income recognized by the company's joint ventures and associates (mainly Anhui Volkswagen). Jianghuai Automobile is simultaneously expanding its passenger and commercial vehicle businesses. By 2025, its commercial vehicle business will account for the majority of its sales revenue, with overseas revenue accounting for 47.15%.

Overall, one of the common reasons for the decline in net profits of multiple car companies in the first quarter is exchange losses. As more and more Chinese car companies accelerate their overseas expansion, exchange rate fluctuations have become an undeniable profit variable. How to effectively manage foreign exchange risks in the context of global expansion will be a compulsory course for the next stage of development for automotive companies. Geely Automobile has always adopted a combination of foreign exchange risk management strategies, actively managing foreign exchange risk exposure through hedging and other tools, reducing the disturbance of multi currency exchange rate fluctuations on profits, and ensuring that overall risks are within a controllable range.

In the first quarter, companies such as BAIC Blue Valley, Haima Automobile, and Zotye Automobile experienced profit losses. Among them, BAIC Blue Valley's revenue was 4.099 billion yuan, a year-on-year increase of 8.65%, but it incurred a loss of 870 million yuan. The gross profit margin increased to 3.04%, a year-on-year increase of 10.55 percentage points. In the first quarter, BAIC Blue Valley delivered 41000 new vehicles, a year-on-year increase of 44.9%, of which Xiangjie accounted for over 30% of sales and Jihu delivered 28000 vehicles.

Haima Automobile and Zotye Automobile are among the 13 car companies with the lowest long-term revenue and are in a loss making state. Among them, Haima Automobile's operating revenue in the first quarter was 199 million yuan, a year-on-year decrease of 25.66%, and the net profit attributable to the parent company was a loss of 32 million yuan, with a loss margin expanding by 6%; Zotye Motors' first quarter revenue was 75 million yuan, a year-on-year decrease of 24.29%, with a net profit loss attributable to the parent company of 82 million yuan, a 20% reduction in the extent of the loss.