Stellantis, the world's fourth largest auto manufacturer, lowered its full-year profit margin expectations on Monday, citing deteriorating global industry dynamics and competition in China's electric vehicle sector.

The company stated that its adjusted profit margin is currently expected to be between 5.5% and 7.0%, lower than the previous forecast of 'double digits,' and added that industrial free cash flow is currently expected to be between -5 billion and -10 billion euros, lower than the previous 'positive' forecast.

The company mentioned that sales in most regions in the second half of this year are lower than expected.

Stellantis stated: 'Due to increased industry supply and intensified competition in China, the competitive situation has intensified.'

Last Friday, Volkswagen also lowered its annual profit forecast for the second time in three months, blaming it on the weak performance of the passenger vehicle segment.