STUTTGART (dpa-AFX) - The world's largest carmakers have recently suffered a drop in profitability, according to a study by consulting firm EY. Compared to the same period last year, according to the analysis, sales rose by around 19 percent in the first quarter of the year, but earnings before interest and taxes (Ebit) lagged behind with growth of 6.1 percent. Sales increased by only four percent.

Profitability - measured by the Ebit margin, which expresses operating profit in relation to sales - fell from nine percent to eight percent. The new margin leader among the 16 automakers analyzed was Stuttgart-based Mercedes-Benz with an Ebit margin of 14.7 percent. It was followed by BMW (14.6 percent) and Kia (12.1 percent). The former leader, electric carmaker Tesla, landed in fourth place with 11.4 percent.

"For the first time since the beginning of 2021, we are seeing clear skid marks in profits, which have long since stopped growing as fast as sales," Constantin Gall, head of EY's Western Europe mobility division, said in a statement. The market is normalizing, he added. "A new car will soon no longer be the scarce commodity it was last year," Gall said. As a result, he said, it will become increasingly difficult for automakers to push through high vehicle prices in the market and forego discounts. "The time of dream margins will soon be over for some companies."

In addition, most manufacturers are currently making significantly higher profits on internal combustion vehicles than on electric vehicles, said EY industry consultant Peter Fuß. Manufacturers must succeed in making electric cars yield more, he said. And: "There is no way around more cost discipline, otherwise there is a permanent threat of significantly lower profitability."/rwi/DP/zb