--- title: "China's EV Makers Post Strong June Deliveries, but Margins Stay Thin" description: "China's electric-vehicle startups reported booming June and second-quarter deliveries: NIO handed over about 107,700 vehicles in the quarter, up nearly 50% from a year earlier, and XPeng topped 103,000. The volumes are impressive — but a brutal price war means all those cars are being sold at wafer-thin margins." category: "Markets" category_url: https://boursel.com/category/markets author: "Priya Venkatesan" published: 2026-07-01T04:43:00.000Z updated: 2026-07-01T04:43:00.000Z canonical: https://boursel.com/article/china-s-ev-makers-post-strong-june-deliveries-but-margins-stay-thin tags: ["china", "electric-vehicles", "nio", "xpeng", "markets"] --- # China's EV Makers Post Strong June Deliveries, but Margins Stay Thin China's electric-vehicle startups reported booming June and second-quarter deliveries: NIO handed over about 107,700 vehicles in the quarter, up nearly 50% from a year earlier, and XPeng topped 103,000. The volumes are impressive — but a brutal price war means all those cars are being sold at wafer-thin margins. China's electric-car makers began the second half of the year by showing off their volumes — and reminding everyone why those volumes don't yet translate into profit. ## The numbers **NIO** delivered about **107,700** vehicles in the second quarter, up roughly **49%** year over year, with **June** deliveries jumping about **63%** to around 40,600, [the company said](https://www.manilatimes.net/2026/07/01/tmt-newswire/globenewswire/nio-inc-provides-june-and-second-quarter-2026-delivery-update/2376395). **XPeng** delivered about **40,100** in June and topped **103,000** for the quarter, [it reported](https://www.prnewswire.com/news-releases/xpeng-announces-vehicle-delivery-results-for-june-and-second-quarter-2026-302815342.html), as it readies its mass-market **Mona L03** sedan. Rival **Li Auto** delivered roughly **31,000** in June. (Monthly delivery counts are the headline metric investors watch for these companies.) NIO and XPeng are US- and Hong Kong-listed **Chinese EV startups** that compete with market leader **BYD** and a crowd of others in the **world's largest EV market.** ## Volume without profit Here's the catch. China's EV market is **fiercely oversupplied**, and a years-long **price war** has crushed profitability. By some industry measures, profit margins across China's auto sector fell to around **3%** — a record low — with gross profit of only about **$2,000 per vehicle**, [the South China Morning Post reported](https://www.scmp.com/business/china-evs/article/3334488/china-ev-makers-profit-woes-fuel-market-anxiety-over-challenging-2026). Even **BYD**, the volume leader, has seen **profit fall sharply** despite selling huge numbers of cars, and Beijing has moved to **ban below-cost selling** to cool the war. NIO has managed to **improve its margins** (its vehicle gross margin rose to around 19% early this year on higher-priced models), but the company — like most of its peers — **still loses money overall.** In short: **strong deliveries ≠ strong earnings.** (Explainer: **gross margin** is what's left after the direct cost of making each car; a **price war** is competitors repeatedly cutting prices to win share, which lifts volumes but shrinks the profit on every sale.) ## The export front — and the tariff wall Facing a saturated home market, Chinese EV makers are pushing hard into **exports.** But they're running into **tariff walls** built to protect Western carmakers: the **US** effectively blocks Chinese EVs with a **100% tariff**, and the **EU** has imposed duties of up to roughly **35%.** That collision — cheap, capable Chinese EVs versus protectionist barriers — is one of the defining tensions in the global auto industry, and a thread Boursel has followed alongside **BMW's** US EV plant and the broader tariff era. ## Why it matters For **China's EV industry**, the June figures show **demand and share gains** are real — these companies are making and selling a lot of cars. For **investors**, they're a reminder that in this market, **growth and profit have decoupled**: volumes soar while margins stay razor-thin, and shakeout risk looms for weaker players. And for the **global auto business**, the rise of capable, low-cost Chinese EVs — bottled up by tariffs but expanding where they can — is **reshaping competition** for legacy giants in Detroit, Germany and Japan. Boursel offers no view on any carmaker's stock; the takeaway is that China is **building and selling EVs at extraordinary scale** — the unresolved question is **who, if anyone, makes money doing it.** ## Sources - [NIO provides June and second-quarter 2026 delivery update](https://www.manilatimes.net/2026/07/01/tmt-newswire/globenewswire/nio-inc-provides-june-and-second-quarter-2026-delivery-update/2376395) - [XPeng announces June and second-quarter 2026 delivery results](https://www.prnewswire.com/news-releases/xpeng-announces-vehicle-delivery-results-for-june-and-second-quarter-2026-302815342.html)