The construction of electric vehicles has evolved into a "billion-euro burden" for many automakers worldwide, according to a recent study. Write-downs on battery factories, development projects, and model lines have accumulated to nearly €60 billion among companies in Europe and the United States, as revealed by an analysis from consulting firm EY. The combined profit of 19 leading automakers globally shrank by 59 percent in 2025.
Suzuki and Toyota topped the list of the 19 most profitable automakers last year, with profit margins of 9.7 and 8.5 percent respectively. They were followed by South Korea's Kia with an 8.0 percent margin and BMW with 7.6 percent. While revenue for the 19 companies rose slightly by 0.6 percent, the picture was markedly different across different regions and manufacturers.
German automakers experienced a revenue decline of 4.1 percent, as EY announced on Sunday. German manufacturers also recorded a weaker performance in new car sales, with a two percent drop compared to the majority of other manufacturers. The three Chinese manufacturers on the list - BYD, Geely, and Great Wall Motors - were able to significantly expand both sales and revenue. Geely was the only manufacturer in 2025 that managed to increase its profit, EY stated.
"The automotive industry is stuck in a deep crisis that is potentially existential for some companies," assessed Constantin Gall of EY. "Many companies had aligned their investments with growing sales markets and a dynamic ramp-up of electric mobility. In reality, demand for electric vehicles is developing significantly weaker than forecast, particularly in the US and Europe." US tariff policy has also led to additional billion-euro burdens.
Therefore, a strategic shift is now underway. Gall emphasized that this does not mean a change of course away from electric mobility, but rather "a correction of completely exaggerated assumptions."
Additional burdens are on the horizon: Given the current economic and geopolitical situation, Gall does not expect a noticeable revival in new car demand in Europe during the current year. "The unstable political global situation, rising energy prices, and higher inflation are poison for automotive business," he stated.
Gall also does not anticipate a boom in electric vehicles driven by high fuel prices: "The odd car buyer will now opt for an electric vehicle after all – but there won't be a real boom." Rather, many people will postpone car purchases and continue driving their old models longer in light of lower disposable incomes and gloomy economic prospects.
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