China EV Stocks Face a Profitability Squeeze as Demand Cools and Costs Rise
Chinese EV makers entered 2026 under pressure from weakening domestic demand, aggressive price competition, and rising battery and component input costs, driving delivery declines and deteriorating investor sentiment. A proposed 2026 trade-in subsidy program and accelerated overseas expansion—particularly into Europe—could provide partial relief, but earnings downgrades and tariff risks remain key swing factors.