The CPCA Branch has highlighted that the automotive industry is experiencing a severe trend of profit hollowing-out, with a significant concentration of profits at the upstream end of the supply chain. Although various regions have been actively implementing the "Two New" (new energy vehicles and new infrastructure) policies, which have effectively invigorated domestic demand, and the trade-in policies for consumer goods have also had a notable impact, the automotive industry's profitability improvement still lags far behind that of other consumer goods sectors.

As the country intensifies its efforts to combat involution (excessive competition leading to diminished returns), the profit margin in the non-ferrous metal mining and beneficiation industry has soared above 30%. Profits in the upstream steel sector have also witnessed a substantial surge. The battery industry, too, is reaping significant profits. When combined with the high costs associated with intelligent driving technologies, these factors are collectively squeezing the profit margins of the automotive industry. In contrast, companies positioned upstream in the industrial chain are displaying robust profit performances.