The electric vehicle (EV) market is growing rapidly, but profitability remains elusive for many companies in the sector. According to a recent report by Rho Motion, only four EV-exclusive carmakers posted a positive operating margin in 2024: Tesla, BYD, Li Auto, and Series Group. Tesla led the field with a 7.2% operating margin, while BYD had a 6.4% margin.
However, the report notes that Tesla’s margin has dipped from previous highs, while BYD’s continues to trend upwards. This suggests that BYD may soon overtake Tesla as the most profitable EV-only brand. One key factor in this success is BYD’s ability to control its supply chain through vertical integration, manufacturing batteries, drivetrains, and software in-house. This allows the company to control costs and improve efficiencies.
Several Chinese EV startups are also showing promising signs of profitability. Zeekr, a premium offshoot of Geely, posted a -8.5% margin in 2024, down sharply from previous years. Xpeng and Leapmotor have made notable progress, each cutting their operating losses by more than half year-on-year. However, others, such as Nio, Polestar, and Rivian, remain in the red.
Lucid, meanwhile, posted the worst figures in the segment, with a -374% operating margin in 2024. The brand’s existence is currently underwritten by Saudi sovereign wealth, cushioning it from the commercial realities facing smaller, independent rivals. Tesla remains the only non-Chinese EV maker with sustainable profitability, but with competition rising and price wars tightening margins, its position is far from secure.