With an expensive savings and investment program, Porsche reacts to the weakening business. The sports car manufacturer also wants to pull the helm around with new combustion models.
The sports car manufacturer Porsche tries to take a cost -intensive measure program against the acute crisis. The board of directors “decided extensive measures to strengthen the company's short and medium-term profitability,” said the Volkswagen subsidiary.
More burners are planned
In order to make the vehicles more attractive for customers again, more Porsche models are to be equipped and built with combustion or plug-in hybrid engines in the future after the electric sports car business runs slowly. This is initially associated with costs, because to develop the new vehicles, in which special and exclusive equipment is also planned, investments must be made.
The management said that a significant additional effort was expected for vehicle development and the battery business. All in all, the operational result is reduced by around 800 million euros.
The organization is also to be rebuilt. Specifically, the company was not in the message. Porsche also did not provide any information on possible effects on the employees.
The forecast displeases the investors
Porsche reacts to the last disappointing numbers. In the first nine months of last year, sales had dropped by 5.2 percent to EUR 28.56 billion. The operational result collapsed by 26.7 percent to 4.04 billion euros. The operational return on sales was only 14.1 percent. In 2023 it was still 18.3 percent. On March 12, Porsche will announce the numbers for the entire year 2024.
In order to bring Porsche back to the road to success, CEO Oliver Blume accepts a significant absorption of the operational return on sales. The operational yield is called the proportion that stuck as an operational profit. The operational return on sales will decrease to ten to twelve percent in 2025. In 2023 it was still 18.3 percent.
VW and Porsche: Problems in China
Porsche and the Volkswagen Group are there with major problems. Above all, the once so lucrative China business weakens. Premium and luxury cars are no longer so good in the People's Republic because wealthy Chinese have to save in the real estate crisis. In the mass market segment, the Volkswagen brand recently lost its market leadership retained for decades because domestic electric car manufacturers like BYD have flooded the market with cheap cars and a price war.
This is why VW has to save at home, among other things, the Wolfsburgers want to delete 35,000 jobs in Germany in the core brand by 2030, but do without factory closures and operational terminations.
Dividend should remain stable
The Porsche dividend should remain roughly at the previous year's level. For 2023, Porsche had released 2.30 euros per ordinary share and 2.31 euros on the listed advantages. Majority shareholder VW, which, like Porsche AG is led by Blume, has not yet wanted to comment on the plans.
In addition to Volkswagen, the holding of the owner families, Porsche SE, also holds a significant share in the Sportwagenbauer Porsche AG. The Stuttgart Holding had already announced that because of the difficult situation, it would probably have to write off billions of book values due to the difficult situation in its investments. Yesterday, the holding updated its information in view of the news of Porsche AG.
Values in billions
For participation in the Sportwagenbauer Porsche AG, Porsche SE is now likely to be a adjustment of 2.5 to 3.5 billion euros instead of only a maximum of two billion. For the Volkswagen shares, it is to be expected that the value adjustment will rather amount to a value at the top of the bandwidth of seven to 20 billion euros, it said.
Last weekend, the car maker announced that CFO Lutz Meschke and Sales Manager Detlev von Platen should vacate their posts. The company did not give any reasons, but the weak performance of experts is the weak performance last year, especially in China.
