XXF Trades Margins For Growth In Sputtering Chinese Car Market

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Mar 25

The company's top-line revenue growth hides intensifying profitability pressure as it ramps up its thin-margin car selling business to supplement its higher-margin car leasing image credit: Bamboo ...

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overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nXXF Trades Margins For Growth In Sputtering Chinese Car Market\n</h2>\n\n<h4 class=\"meta\">\n\n\n2026-03-25 19:48 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.benzinga.com/Opinion/26/03/51452717/xxf-trades-margins-for-growth-in-sputtering-chinese-car-market><strong>Benzinga_recent_news</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The company's top-line revenue growth hides intensifying profitability pressure as it ramps up its thin-margin car selling business to supplement its higher-margin car leasing\nimage credit: Bamboo ...</p>\n\n<a href=\"https://www.benzinga.com/Opinion/26/03/51452717/xxf-trades-margins-for-growth-in-sputtering-chinese-car-market\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK1239","symbol_name":"汽车零售","start_time":0,"source_url":"https://www.benzinga.com/Opinion/26/03/51452717/xxf-trades-margins-for-growth-in-sputtering-chinese-car-market","article_id":"2622073634","we_media_id":null,"thumbnails":["https://cdn.benzinga.com/files/images/story/2026/03/25/-25-3-2026-134020-thebambooworks-com.jpeg?optimize=medium&dpr=2&auto=webp&width=240"],"rights":{"source":"benzinga_recent_news","url":"https://www.benzinga.com/Opinion/26/03/51452717/xxf-trades-margins-for-growth-in-sputtering-chinese-car-market","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=2622073634","pubTimestamp":1774439280,"columns":[],"sourceInfo":{"source_id":"benzinga_recent_news","name":"Benzinga"},"weMediaInfo":null,"summary":"The company's top-line revenue growth hides intensifying profitability pressure as it ramps up its thin-margin car selling business to supplement its higher-margin car leasing. A combination of industry-specific challenges and macroeconomic conditions is squeezing profitability for China's auto companies in general. At the industry level, automakers desperate to boost sales in the current climate of weak demand and massive overcapacity have unleashed a wave of subsidized low-interest and zero-interest loans with long terms. That's forcing independent car sellers and lessors like XXF to cut their terms to remain competitive.But this shift is further dragging down XXF's margins. The car sales business carries a paper-thin gross margin of just 4.4%, a tiny fraction of the 33% for its core auto leasing operations. As the car sales segment expanded, XXF's overall gross margin shrank more than four percentage points to 25.7% in 2025.To add Benzinga News as your preferred source on Google, cl","collect":0,"end_time":0,"defaultTopTitle":"benzinga.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK1239":"汽车零售","02473":"喜相逢集团"},"translate_title":"XXF以利润换取中国汽车市场的增长","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"02473":1.5},"content_text":"The company's top-line revenue growth hides intensifying profitability pressure as it ramps up its thin-margin car selling business to supplement its higher-margin car leasing\nimage credit: Bamboo Works\nA combination of industry-specific challenges and macroeconomic conditions is squeezing profitability for China's auto companies in general. At the industry level, automakers desperate to boost sales in the current climate of weak demand and massive overcapacity have unleashed a wave of subsidized low-interest and zero-interest loans with long terms. That's forcing independent car sellers and lessors like XXF to cut their terms to remain competitive.\nBut this shift is further dragging down XXF's margins. The car sales business carries a paper-thin gross margin of just 4.4%, a tiny fraction of the 33% for its core auto leasing operations. As the car sales segment expanded, XXF's overall gross margin shrank more than four percentage points to 25.7% in 2025.\nThings aren't likely to get any better this year. After notching 6.7% growth last year, a big part of that from inventory clearing at big discounts and people rushing to take advantage of government incentives, China's domestic car sales fell 8.8% in the first two months of this year.\nXXF's growing focus on vehicle sales in the current weak industry climate creates another headache for the company. Constant price cuts by automakers lower the values of vehicles in XXF's own inventory, which could force it to cut prices on those vehicles to attract buyers, potentially making it sell vehicles at losses.\nXXF is also looking to use technology to boost efficiency, doubling its number of \"digital employees\" to 200 by the end of 2025 from a year earlier. Moreover, late last year, it created a subsidiary dedicated to smart mobility services and formed partnerships with autonomous delivery firms. These new services may become significant revenue contributors one day. But for now, at least, they only represent nascent businesses with an uncertain future.\nNot surprisingly, XXF shares have dropped nearly 10% since it reported its latest results last week. They still trade above their IPO price in 2023, fetching a price-to-earnings (P/E) ratio of nearly 50, far higher than 12 for Yixin. But the big gap is largely because XXF has a much smaller profit base, suggesting its stock has room to fall if the company fails to halt its margin erosion.\nTo subscribe to Bamboo Works weekly free newsletter, click here\nBenzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.\nTo add Benzinga News as your preferred source on Google, click here.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":false,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"isVideo":false,"video":null,"symbols":[],"gpt_button":0,"need_auth":false,"need_login_tip":false,"code":"91000000","status":"200"}}}