How does WordPress update plugins, without running into permissions issues?

WP routinely runs into permission issues with updates. Whenever its Filesystem API detects that file operations required cannot be performed it requests login credentials to perform update over FTP or SSH.

Since third party automated code cannot make such request interactively that’s the reason it likely just fails.

There is number of Upgrade Constants that allow to hardcode credential in configuration and be used automatically instead if interactive request. They still need code to be coded to use APIs rather than attempt direct writes.