It's one thing to sell cars and top the sales charts, and another to make money selling cars. Being popular doesn't necessarily mean making money, and there are two brands in the automotive industry that know this very well. Ferrari and Porsche, two of the most iconic brands, achieved the highest profit margins in 2023, despite being at the bottom of the year's sales figures.

The latest analysis of the financial results published by most Western car manufacturers (from Europe, the US, Japan and Korea) and two Chinese OEMs shows that the industry had a very good year in terms of sales and profits. The data collected for 24 OEMs shows that revenues (i.e. the money earned from selling cars and other activities) increased by 11% to €2.25 trillion.

The increase in revenue is not primarily due to the increase in units sold (+ 9%), but to the increase in car prices. The Volkswagen Group, Toyota and Stellantis recorded the highest revenues with increases of 15%, 11% and 6% respectively. In fact, all 24 car manufacturers in the sector recorded increases, with the exception of Isuzu, whose sales remained stable.

Ferrari gains even more

The ranking changes fundamentally when looking at the profitability of these companies. In 2023, they all generated a combined €187.8 billion in operating profits (the money earned after paying the necessary expenses). This total is up 18% compared to 2022, when the same OEMs reported a combined profit of €159.4bn. The 18% increase is higher than the growth in sales, meaning that the industry's margin has risen from 7.8% in 2022 to 8.4% in 2023.

The frontrunner is still Ferrari. The Italian company is not only a benchmark for sports cars worldwide, but also a real money-printing machine. In 2023, Ferrari delivered 13,663 super sports cars and generated a total turnover of €5.97 billion, an increase of 3.3% or 17%. This means that the company was able to sell more expensive cars than before and earn more from other activities such as Formula 1 or merchandising.

Ferrari e Porsche, le due aziende automobilistiche più redditizie

The three most profitable manufacturers in 2023 (operating profit 2023. Source: OEM)

Ferrari's operating profit totalled €1.61 billion, which corresponds to 27% of total sales. This is a huge operating margin that confirms Ferrari's solid position in the industry. In other words, the company retained 27 cents for every euro of turnover. Last year, the percentage was 24%. No other car manufacturer comes close to these brilliant results.

Porsche also shines

The other winner of the year is Porsche with a profit of €7.28 billion on a turnover of €40.53 billion. The operating margin remained stable at 18% and is the second highest after Ferrari. Porsche benefited from increased sales of its flagship 911 and the Taycan, while its three SUV series accounted for 55% of global sales.

Ferrari e Porsche, le due aziende automobilistiche più redditizie

The three manufacturers with the highest sales in 2023 (operating margin 2023. Source: OEMs)

Other major players include Jaguar Land Rover, which went from a loss in 2022 to a profit last year. Toyota, Kia and the BMW Group also recorded a strong increase in operating margin. Among the major OEMs, Stellantis leads with a margin of 11.8%, followed by Toyota, Hyundai and Suzuki.

The only two Chinese manufacturers present, BYD and Great Wall Motors (the other companies have not yet published their results), reported mixed results, confirming that they are in a phase of unit growth while profitability is not yet a priority.

Operating margin

  2022 2023 Change in
Ferrari 24% 27% +3%
Porsche 18% 18% 0%
BMW Group 9.8% 11.9% +2.1%
Stellantis 11.3% 11.8% +0.5%
Kia 8.4% 11.6% +3.3%
Daimler 12.3% 11.4% -0.9%
Toyota 7.2% 11.1% +3.9%
Jaguar Land Rover -1.9% 11% +12.9%
Subaru 6.4% 9.5% +3.1%
Hyundai 6.9% 9.3% +2.4%
Tesla 16.8% 9.2% -7.6%
Isuzu 7.7% 9.1% +1.4%
Suzuki 7.1% 8.5% +1.4%
Mitsubishi 7.6% 7.2% -0.4%
Volkswagen Group (incl. Porsche) 7.9% 7% -0.9%
BYD 5.1% 6.3% +1.2%
Honda 5.7% 5.8% +0.1%
GM 6.6% 5.4% -1.2%
Volvo 6.8% 5% -1.8%
Mazda 4.1% 5% +0.8%
Renault 4.7% 4.7% 0%
Nissan 3.5% 4.6% +1.1%
Ford 4% 3.1% -0.9%
Great Wall 4.8% 1.6% -3.2%
Aston Martin -10.3% -6.8% +3.5%

The author of the article, Felipe Munoz, is Automotive Industry Specialist at  JATO Dynamics.