Recently, Volkswagen Group announced plans to significantly trim its product lineup, potentially cutting up to half of its models in the future. It is not the first automaker to adopt "minimalism." Besides Volkswagen, Toyota is also re-evaluating its current product strategy, and may reduce development costs and improve overall profitability by streamlining models and trim levels in the future. Meanwhile, Mercedes-Benz, Nissan, Ford, Great Wall Motor, Geely, and Changan have also successively bid farewell to the product proliferation strategy. Streamlining, divesting, and abandoning extensive expansion—this seems to be the common goal of global automakers today.
It is reported that the Touareg and Touran models from Volkswagen Group have already been discontinued, and the T-Roc Cabriolet will cease production in 2027; the Audi A1 and Q2 are bidding farewell to the market, while the Audi TT, supercar R8, and Q8 e-tron have been successively discontinued; Porsche's 718 Boxster and 718 Cayman halted production in October last year, and the first-generation Macan will end production at the end of July this year.
On the Toyota front, the mass production plan for the next-generation all-electric sedan Lexus LF-ZC has been suspended. Business Insider attributes a series of moves by Volkswagen, Toyota, and Ford to the global automotive industry entering an era of "decluttering." Perhaps this is a fate the entire industry cannot escape. Some companies that do not intend to reduce the number of models have chosen to streamline model variants. For example, Dongfeng Honda S7 only offers two configurations: Pioneer and Navigator; Li Auto i8 has adjusted its three model variants to just one; and the new NIO ES6 focuses on "fully loaded as standard."
Various signs indicate that, led by top automakers, the number of new cars globally may decrease in the future.
Eliminating "Rivals" for Themselves?
Why are automakers proactively choosing to "declutter"?
Profit, cost, sales, profitability, and homogenization are all crucial factors under consideration. Over the past year, the profitability of global automakers has generally declined. Data shows that in fiscal year 2025, the per-vehicle profit of the world's top seven automakers dropped, with Tesla's per-vehicle profit plunging by 40%; Toyota's per-vehicle profit fell by 20% year-on-year; Stellantis and Ford Motor even slipped into losses. Volkswagen and General Motors are also facing immense profit pressure.
By the first half of 2026, Volkswagen Group's operating profit was 5.931 billion euros, a year-on-year drop of up to 11.6%; the operating profit margin decreased from 4.2% to 3.8%; and the after-tax profit was 3.1 billion euros, down 30.7% year-on-year. Despite declining profitability figures, cost expenditures are rising. As early as August 2025, China Securities Journal reported that mainstream global automakers basically cited rising costs when explaining the reasons for their performance decline. In July 2026, Cui Dongshu from the Passenger Car Market Information Joint Committee of the China Automobile Dealers Association released data showing that, with bulk commodity prices running high, the per-vehicle cost across the automotive industry chain from January to June hit 305,000 yuan, a year-on-year increase of 6%.
In contrast, the gross profit per vehicle during the same period was only 13,000 yuan, a year-on-year decrease of 17.7%. These sets of worrying figures may be the fundamental reason why automakers are continuously shrinking their lineups. Of course, there is another important factor worth mentioning: homogenization. Notably, the "homogenization" here does not refer to external market homogenization, but rather the internal self-"substitution" that has been going on for a long time.
During the golden age of incremental growth in the automotive industry, a multi-brand matrix was the standard play for automotive giants, achieving full coverage of segmented markets through different positioning. A typical example is Volkswagen: Volkswagen, Skoda, SEAT, and CUPRA form the mainstream brand array, along with the luxury brand Audi, supercar brands Porsche and Lamborghini, plus the commercial vehicle segment, with more than ten independent brands lined up.
Similarly, Stellantis, as one of the automakers with the most brands globally, has gathered more than ten brands including Peugeot, Citroen, Opel, Fiat, Dodge, Jeep, and Alfa Romeo, once being called the "department store" of the automotive industry. In the years when the auto market was booming, this massive brand system was a huge profit engine.
With similar technical platforms and powertrains, simply changing the car emblem and exterior shell could harvest users from different circles and leverage the maximized market share and revenue scale. However, as the automotive industry enters the era of stock competition, this approach not only increases the burden but also causes internal "cannibalization" within the enterprise. In particular, the differences and positioning among brands under the same automaker are accelerating in shrinking, and some brands are beginning to perish at the hands of their own people.
Taking Skoda, the "Volkswagen alternative," as an example, from 2018 to 2025, the core competitors of its best-selling models almost entirely came from the Volkswagen brand. Among them, the top 5 most frequently compared models for its flagship product, the Octavia, all belong to the Volkswagen or Skoda brands. The reason is simply that the Volkswagen brand, which is being substituted, cannot withstand the impact of market changes and has been continuously lowering its prices.
Terminal sales data shows that the sales share of the Volkswagen brand in the 100,000 to 200,000 yuan price segment has continued to expand. As of 2025, this segment has contributed over 70% of sales, with the 150,000 to 200,000 yuan segment showing the most outstanding growth, with its share climbing from 18% in 2018 to 35% in 2025. This change in brand positioning has directly affected the other brand.
Retail sales data indicates that over 10 years from 2016 to 2025, Skoda's sales in China fell from over 300,000 units to less than 15,000 units. This is the total brand sales, but how many units must a new model sell to achieve break-even over its entire life cycle? China Automotive News estimates it to be 100,000 units. In 2025, including global total sales, Skoda's sales for models other than the Octavia, Kodiaq, Kamiq, Fabia, and Karoq were all below 100,000 units. In March 2026, Skoda confirmed it would exit the Chinese market.
In the future, the tragedy of "Skoda" will continue to unfold. After all, besides internal competition, external pressure is also increasing. According to incomplete statistics, in the first half of this year alone, more than 500 new cars were launched in China. Automakers cannot stop others' desire to progress; to survive better, they can only learn to control themselves, phasing out weaker products to preserve stronger ones.
Has the Era of the "Universal" Platform Arrived?
Interestingly, the means for automakers to seek more stable survival are not limited to streamlining models and reducing configurations. Beneath this product-side "subtraction," a deeper transformation—bidding farewell to the past multi-platform model and betting on highly versatile "universal platforms"—is also advancing simultaneously in the industry. The prevailing logic in the old era was that every segmented category, each powertrain type, and even different brands within a group had their own independent, exclusive development platforms. Today, a highly compatible modular architecture can horizontally cover sedans, SUVs, MPVs, pickup trucks, and more.
For example, in 2026, Great Wall Motor released its new vehicle platform "Guiyuan", covering seven major categories including sedans, urban SUVs, light off-road SUVs, heavy off-road SUVs, pickup trucks, MPVs, and sports cars, compatible with five powertrain forms: plug-in hybrid, hybrid, pure electric, fuel, and hydrogen energy. It is reported that in the future, Great Wall Motor will be able to produce over 50 models based on this "universal" platform.
In addition, The Economic Observer reported that Volkswagen also plans to launch the SSP platform, integrating the three ICE platforms MQB, MSB, and MLB, and the two BEV platforms MEB and PPE, which will be able to produce all brands and class models under Volkswagen in the future; BMW's new "Neue Klasse" platform emphasizes compatibility with multiple powertrain forms, with its first mass-produced model being the iX3. Previously, platform reduction and integration by General Motors, Mercedes-Benz, and Ford were also being vigorously promoted.
Is the Era of the "Universal Platform" for Automobiles Approaching?
Undeniably, the global automotive industry is facing a critical juncture of restructuring under pressure and breaking through bottlenecks. The "2026 Global Automotive Industry Mid-Year Panoramic Scan Report" shows that from January to May 2026, global auto sales were about 39.15 million units, a year-on-year increase of 2%, presenting a pattern of "slight total volume growth, sluggish growth momentum, and regional differentiation." Even the NEV (New Energy Vehicles) sector, which has expanded at high speed for many years, is bidding farewell to the era of high growth. BMI data shows that global NEV passenger car sales reached 7.5 million units in the same period in 2026, a year-on-year increase of 0.9%; compared with the compound annual growth rate of 40% from 2017 to 2025, the industry's growth dividend has significantly faded. This means market competition is becoming increasingly fierce, and automakers need more means to "increase income and reduce expenditure."
The "universal platform" has significant effects in cost savings. An analyst from Victory Bird Strategic Consulting stated that the hidden costs for automakers to develop and maintain an all-new platform can run into billions, even tens of billions of yuan. Compatible platforms can increase the parts commonality rate to over 70% by sharing chassis, E/E (Electrical/Electronic) architecture, and thermal management systems. Great Wall Motor has also estimated that the Guiyuan platform can reduce R&D costs by at least 30%.
To "save money," many automakers are currently going to extremes, including the electrification plans they once vigorously pursued. In the first half of 2026, traditional giants such as Volkswagen, Stellantis, Mercedes-Benz, BMW, and Honda unanimously scaled back their "electrification strategies," instead channeling limited resources into more efficient projects.
It is reported that behind Volkswagen's series of operations lies a "grand" plan: to achieve an 8%-10% sales operating return rate by 2030, with its automotive division generating higher net cash flow and contributing more than 60% of the group’s operating profit. Similarly, Nissan has streamlined its model lineup from 56 to 45, hoping to concentrate resources so that these models contribute over 80% of global sales, with per-vehicle sales increasing by 30%. Against this backdrop, the "universal platform," which is directly linked to system efficiency and cost control, has emerged. However, this architecture also has indelible hidden dangers.
In recent years, "mass recalls" of automobiles have become increasingly frequent. In the first half of 2026, the State Administration for Market Regulation issued a total of 50 auto-related recall announcements, involving 26 car brands, with a total recall volume of about 1.65 million units, meaning an average of over 9,000 cars entered the recall scope every day.
Independent Auto Net analyzed and reported on these figures, stating that the more platform-dependent and software-defined a vehicle becomes, the more likely a local design, program, or manufacturing deviation will rapidly expand to tens of thousands or even hundreds of thousands of vehicles along the shared platform, software versions, and supply chain. In addition, issues such as whether homogenization will worsen and whether brand positioning will blur also need to be considered... In short, the series of self-rescue moves after the automotive industry enters the era of stock market involution may not necessarily solve the real problems.
After the Ebb of Product Proliferation, Auto Competition Returns to the Brand Origin
Currently, the massive automotive lineup not only exhausts enterprises but also dazzles consumers. The "Global EV Outlook 2026" released by the International Energy Agency shows that in 2025 alone, there were over 1,100 car models available for sale in the Chinese market. Among these, whether it is the model, technology, configuration, or supplier, they are becoming increasingly identical.
As automakers continuously simplify their model lineups and cut projects with weak profitability, brands become increasingly important next. The "2026 McKinsey China Automotive Consumer Insight" also mentions the importance of "brands." It is reported that as the gaps in basic vehicle technologies (such as range, autonomous driving, and smart cockpit) are basically eliminated, consumers in a highly complex market are beginning to rely on "brands" to facilitate the car-buying decision process.
Data shows that among the key car purchasing factors, the ranking of "brand" has leaped from fifth to second place. Especially in the EV supply chain, CATL (Contemporary Amperex Technology Co., Limited) global market share has steadily increased, and Qualcomm's cockpit chips hold about a 75% share. The convergence of technology routes and the concentration of the supply chain have made the importance of "brand" second only to "range and charging time."
Over the past decade or so, multi-model coverage and multi-brand positioning have been the growth bible for almost all automakers. Volkswagen and Stellantis have reaped the incremental dividends relying on their complex brand matrices, and independent automakers have also used the "product proliferation strategy" to run for land. But today, this approach has become a burden; as products become more and more alike, the brand becomes more important for automakers.
Obviously, some automakers have realized this. They are reducing their lineups while re-strengthening brand management. A typical example is Nissan. It is reported that Nissan has established three strategic pillars, among which the "brand strategy" is particularly prominent. Nissan plans to promote brand renewal at the brand level, shaping a young, innovative, and passionate brand image.
Stellantis is the same. After integrating the two major automaker systems of PSA and FCA, it retains brands with remaining influence such as Peugeot, Citroen, Jeep, Maserati, and Dodge, concentrating resource investment and conducting differentiated brand operations. Volkswagen also stated on its official website that the Volkswagen, Skoda, SEAT/CUPRA, and Volkswagen Commercial Vehicles brands will introduce a new cross-brand management model. And reshaping the brand is even more urgent for high-end automobiles.
In recent years, the price war in high-end automobiles has been repeated, and the positioning and image of some luxury car brands have been severely impacted. In March 2026, Jaguar Land Rover announced the complete halt of production for its domestically produced ICE models. Due to the long-term erosion of brand premium by the label of "30% off Jaguar, 20% off Land Rover," the brand ultimately decided to cut ties with itself and retreat to the imported high-end market. From the marketing index of the entire automotive industry, it can also be seen that competition in the auto industry has shifted dramatically: from flooding the market with models to capture share, to building brands to retain customers.
The "2025 Automotive Industry Online Marketing Monitoring Report" released by iResearch shows that in July 2025, the number of advertisers in the domestic automotive industry officially ushered in growth, with March being the peak of investment and a significant increase in advertising intensity. The marketing costs of major automakers are also rising sharply, especially some traditional automakers, such as SAIC Motor. In 2025, SAIC's sales expenses were 20.898 billion yuan, a year-on-year increase of 4.07% compared to 20.08 billion yuan in the previous year; among them, advertising and promotional expenses accounted for the bulk of sales expenses, reaching 9.179 billion yuan, a year-on-year increase of about 27.04% compared to 7.225 billion yuan in 2024.
Great Wall Motor has also been focusing on cultivating its brand in recent years. In 2025, Great Wall Motor's sales expenses were 11.27 billion yuan, a year-on-year increase of 43.9%, of which advertising and media service fees were 4.22 billion yuan, compared to 3.197 billion yuan in the previous year. Although it costs money, it is a necessary expenditure, after all, the experience gap of most models has narrowed to within the user perception threshold, and the brand has once again become the core foundation for automakers' profitability.
From the expansion philosophy of "having more children to fight better" to the universal "decluttering," the global automotive industry has completed a full business cycle in decades. When automakers personally cut the models they once competed to launch, shrink the brand lines they heavily invested in, and turn the money saved from R&D and production lines to invest in the battlefield of brand mindshare. After going around in circles, everything seems to have returned to the starting point.