While the rise of electric, driverless vehicles and shared mobility has caused major disruptions to the auto industry, it has been revealed how much gross profit margins automotive giants have earned over the past four years.
According to 2021 data, although the COVID-19 pandemic caused an 11 percent decrease in the revenues of the entire global automotive industry, the profit margin of the automotive industry had become a concern long ago. Profit margins for Tesla, Toyota, Volkswagen, General Motors and Ford were calculated, with worldwide factory closures, declines in auto sales and massive layoffs.
Profit margins of automotive brands: Tesla is way ahead
It would not be wrong to say that the US electric car manufacturer Tesla is at the forefront in the 2018-2022 gross profit margin chart shared by Emre Özpeynirci. Just behind Tesla, which achieved a 31 percent profit margin in a four-year period and achieved large revenues despite the chip crisis, is Japanese giant Toyota with 17 percent.
Let us state that after Toyota, Volkswagen, GM and Ford take place, respectively. Volkswagen is third with 15 percent, GM is fourth with 10 percent, and Ford is fifth with 8 percent, despite a negative profit margin.
When we examine the graph, especially the second quarter of 2020 draws attention. In this period, when the Covid-19 pandemic broke out, all manufacturers, except Tesla, seem to have suffered great losses. On the contrary, Tesla managed to increase its revenue in this quarter. It’s interesting to see Ford decline to almost minus 10 percent over the same period.
Between 2015 and 2020, the average profit margin for major automotive companies worldwide was about 7.5 percent. Now, this figure (at least for the five big producers) has come up to 16.2%. Profitability varies from company to company, but overall, electric car manufacturers like Tesla have observed higher profit margins.
Industry experts predict the market will see an annual growth rate of 7.22 percent as the focus shifts to electric vehicle production to meet growing demand for greener transportation and comply with new guidelines for emissions standards.
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