In the first half of the year, the net profit of BYD + Geely + Great Wall ≈ CATL. Is selling cars less profitable than selling batteries?

In the first half of 2025, the financial reports of listed Chinese passenger car manufacturers were successively released.

Reviewing the financial data of listed passenger car manufacturers that have released their first - half 2025 financial reports, it can be found that against the backdrop of the continuous growth in new energy vehicle sales, the industry presents a unique phenomenon.

On the one hand, the explosive growth in new energy vehicle sales has become a highlight in the automakers' financial reports and has driven a sharp increase in the performance of upstream power battery companies.

On the other hand, the fierce "price war" and "involution" have led automakers into the dilemma of "increasing sales but not revenue", and their profit margins have been significantly compressed.

The first - half 2025 financial report data shows that with the development of new energy vehicles, domestic brands have encroached on a large amount of market share from joint - venture companies.

As the "cash cows" of joint - venture companies fade away, the profitability of large state - owned automobile groups has declined significantly. The overall profits of the entire automobile industry are shrinking substantially, and the profitability of leading private enterprises is more prominent. Among listed Chinese passenger car companies, the top three private enterprises with the highest net profits in the first half of the year are BYD (002594.SZ), Geely (0175.HK), and Great Wall Motor (601633.SH).

However, the combined profits of the three "most profitable" private automakers, BYD (15.51 billion yuan), Geely Auto (9.29 billion yuan), and Great Wall Motor (6.34 billion yuan) in the first half of the year (approximately 31.14 billion yuan in total), are almost equivalent to the net profit of CATL, a battery company that has risen thanks to new energy vehicles (30.49 billion yuan).

The semi - annual reports of automakers generally reflect the profound impact of price wars and involution on profitability. There are no winners in price wars, and this pressure may continue.

Expressions such as "fierce market competition", "price pressure", and "intensified industry involution" frequently appear in the semi - annual performance reports, reflecting the challenges that enterprises face in balancing cost pressure and sales growth.

Analyzing the Joys and Sorrows in the Financial Reports of Three Major Private Automakers

Judging from the released financial report data, among the top four passenger car manufacturers in terms of operating revenue in the first half of 2025, BYD ranked first with an operating revenue of 371.281 billion yuan; SAIC Motor followed closely with 294.326 billion yuan; Geely Auto ranked third with an operating revenue of 150.285 billion yuan; and Great Wall Motor ranked fourth with an operating revenue of 92.335 billion yuan in the first half of the year. Among them, except for SAIC Motor, the other three are private automakers. However, although SAIC Motor has higher revenue, its net profit is lower than that of Geely Auto and Great Wall Motor.

Analyzing the financial reports of the three leading private automakers, it can be found that their performance in the first half of the year has different characteristics.

In terms of operating revenue, all three automakers achieved positive revenue growth.

BYD's operating revenue in the first half of the year was 371.281 billion yuan, a year - on - year increase of 23.30%, ranking the highest among the three and leading by a large margin.

Geely Auto's operating revenue was 150.285 billion yuan, a year - on - year increase of 26.51%, with the fastest growth rate.

Great Wall Motor's operating revenue in the first half of the year reached 92.335 billion yuan, a year - on - year increase of 0.99%, with a relatively slow growth rate. However, its operating revenue in the second quarter was 52.348 billion yuan, a year - on - year increase of 7.78%, showing a significant acceleration compared with the year - on - year decline of 6.63% in the first quarter.

In terms of profit performance, there was a relatively serious divergence. Among the three, only BYD achieved a "double harvest" of operating revenue and net profit, while Geely Auto and Great Wall Motor experienced the phenomenon of "increasing revenue but not profit".

BYD's net profit was 15.511 billion yuan, a year - on - year increase of 13.79%; Geely Auto's net profit was 9.29 billion yuan, a year - on - year decrease of 14%; and Great Wall Motor's net profit was 6.337 billion yuan, a year - on - year decrease of 10.22%.

However, the reasons for the decline in net profit of Geely Auto and Great Wall Motor are different.

Among them, Geely Auto's core net profit attributable to the parent company during the period was 6.66 billion yuan. After deducting the foreign exchange gain or loss of 2.64 billion yuan during the period, the net profit attributable to the parent company, compared with the core net profit attributable to the parent company of 3.3 billion yuan last year after excluding the one - time gain of 7.73 billion yuan from the sale of a subsidiary and the asset impairment loss of 0.25 billion yuan, increased by 102% year - on - year.

After deducting non - recurring gains and losses such as government subsidies of 2.84 billion yuan in the first half of the year, Great Wall Motor's non - recurring profit - adjusted net profit in the first half of the year was only 3.581 billion yuan, a year - on - year decrease of 36.39%. This means that the main reason for the decline in Great Wall Motor's profit lies in the decline of its core automotive business.

In terms of sales volume, the sales growth of the three automakers was "booming". Data shows that all three leading private automakers achieved double - digit sales growth in the first half of the year:

BYD's cumulative sales volume in the first half of the year was 2.1459 million vehicles, a year - on - year increase of 33.04%. Among them, the sales volume of new energy vehicles was 2.1132 million vehicles, a year - on - year increase of 30.94%, and its market share continued to lead.

Geely Auto's cumulative sales volume in the first half of the year was 1.409 million vehicles, a year - on - year increase of 47.40%. The sales volume of new energy vehicles was 725,000 vehicles, a year - on - year increase of 126.00%, and the penetration rate of new energy vehicles increased significantly.

Great Wall Motor's cumulative sales volume in the first half of the year was 569,000 vehicles, a year - on - year increase of 10.40%. The sales volume of new energy vehicles was 160,000 vehicles, a year - on - year increase of 22.64%, and the pace of new energy transformation accelerated.

A common feature is that the sales growth rate > the revenue growth rate > the profit growth rate. This means that the price of new vehicles per unit has decreased, and the profit margin has been further compressed.

The direct cause of this result is the price war.

Market Share vs. Profit

The automotive industry is a business that extremely pursues scale and efficiency. In the context of price wars and profound changes in the supply - demand relationship, automobile manufacturers need to find a balance between scale and efficiency.

The price war is impacting all participants in the industry.

In the "bloody" price war, automakers involved can hardly stay out of it and are caught in the dilemma of "choosing market share" or "choosing profit".

In order to survive, automakers have to engage in a close - range fight on price.

In the first half of this year, BYD's revenue exceeded that of Tesla for the first time, but its gross profit margin decreased from 18.78% in the same period last year to 18.01%. Among them, BYD sold 144,000 more new vehicles in the second quarter than in the first quarter, and its revenue increased by more than 30% year - on - year. However, the gross profit margin in the second quarter was 16.3%, a decrease of 3.8 percentage points quarter - on - quarter. The contraction of the profit margin directly led to the impairment of the profitability per vehicle. Morgan Stanley said in its latest research report that BYD's profit per vehicle in the second quarter has dropped from 8,800 yuan in the first quarter to 4,800 yuan.

BYD said in its financial report that the competition in the Chinese automotive industry has reached a white - hot stage, and industry irregularities such as "fixed - price sales" and "excessive marketing" have emerged, which have greatly disrupted the normal business order and hindered the high - quality development process of the automotive industry.

Once relying on the advantages of vertical integration and economies of scale, BYD's financial report figures were particularly eye - catching, but now BYD also faces considerable growth pressure. In the first half of this year, BYD's cumulative sales volume was 2.1459 million vehicles, a year - on - year increase of 33.04%. However, since May, its sales volume has decreased both year - on - year and quarter - on - quarter. From May to July, it sold 294,000, 293,000, and 263,000 vehicles respectively, showing a continuous quarter - on - quarter decline for three consecutive months.

Specifically, BYD's sales are concentrated in the Dynasty Network and Ocean Network, which mainly feature mass - market models priced below 200,000 yuan. The cumulative sales volume of the two networks in the first half of the year was 1.95 million vehicles, accounting for more than 90% of the total sales volume. In addition, the high - level R & D investment in intelligentization has not yet been translated into actual sales; the high - end brands are yet to make a breakthrough. The cumulative sales volume of Denza, Fangchengbao, and Yangwang in the first half of the year was 142,000 vehicles in total, accounting for only 6.6% of the total sales volume.

Meanwhile, its old rival, Geely Auto, is accelerating its pursuit. In the second quarter of this year, its sales volume was 235,000, 236,000, and 237,000 vehicles respectively, showing a quarter - on - quarter increase. According to the data of the Passenger Car Association, in July this year, BYD's market share dropped to 15%, compared with 18% in the same period last year, while Geely's market share increased from 6.8% to 11.1%.

However, Geely Auto's gross profit has also been affected by the price war.

According to Geely Auto's financial report, in the first half of this year, the average sales revenue per vehicle of Geely Auto decreased by 14,000 yuan year - on - year to 96,000 yuan; the gross profit margin was 16.4%, a decrease of 0.3 percentage points year - on - year; the gross profit margin in the second quarter was slightly higher than that in the first quarter, at 17.1%, a slight decrease of 0.7% year - on - year. Dongwu Securities estimated that its net profit attributable to the parent company per vehicle was 5,000 yuan.

The new energy business has become the biggest highlight of Geely Auto in the first half of the year. Gui Shengyue, the CEO and executive director of Geely Auto, even said bluntly that the truly "valuable" part of Geely Auto's sales volume in the first half of the year lies in the fact that the gap between Geely Auto's market share of all - category models and new energy vehicles in the domestic market and that of the first - ranked company (i.e., BYD) is constantly narrowing.

Among them, Geely Auto's market share of new energy vehicles in the first half of the year was 11.44%, ranking second. There is still a gap of 18 percentage points from the market share of 29.48% of the first - ranked company (i.e., BYD). However, compared with a gap of 27 percentage points last year, the gap has significantly narrowed.

While BYD and Geely Auto are vying with each other, Great Wall Motor seems to have fallen behind.

In the first half of this year, Great Wall Motor's operating revenue increased slightly by 0.99%, its net profit decreased by 10.22%, the non - recurring profit - adjusted net profit was only 3.581 billion yuan, a significant year - on - year decrease of 36.39%. During the same period, the gross profit margin decreased by 7.83 percentage points year - on - year to 18.38%, and the net profit margin decreased by 11.1% year - on - year to 6.86%. The profitability of its main business is rapidly declining.

Wei Jianjun, the chairman of Great Wall Motor, has publicly questioned the "sales - first theory" many times, saying that "Great Wall is not afraid even if its sales volume drops out of the top ten, because for healthy development, it would rather do less and have a smaller market share than pursue meaningless sales volume." However, it is an undeniable fact that Great Wall Motor lags behind in new energy vehicle sales.

In the first half of this year, the cumulative sales volume of its new energy vehicle models was 160,400