PORSCHE IS FACING FINANCIAL CHALLENGES AFTER LOSING BILLIONS ON ITS ELECTRIC VEHICLES.
THE AUTOMAKER’S PROFIT MARGIN IS EXPECTED TO DROP TO AS LOW AS 10% THIS YEAR—
SIGNIFICANTLY LOWER THAN THE 20% TARGET MANAGEMENT HAD OUTLINED AHEAD OF ITS INITIAL PUBLIC OFFERING IN 2022.
PORSCHE’S STOCK FELL AS MUCH AS 8% FRIDAY, REACHING A NEW LOW SINCE ITS IPO-
WITH THE COMPANY’S MARKET VALUE NOW HALF OF WHAT IT WAS IN 2023.
ANALYSTS HAVE DESCRIBED THIS AS A “SHARP DETERIORATION”-
CALLING IT A “MAJOR CONCERN.”
THIS SITUATION COMES AFTER PORSCHE PULLED BACK FROM TRANSITIONING TO ELECTRIC VEHICLES LAST YEAR CITING UNDERWHELMING DEMAND-
AS SOME OF ITS EV MODELS LOST NEARLY 50% OF THEIR VALUE WITHIN THE FIRST YEAR AFTER BEING SOLD.
TO REVERSE COURSE AND REINVEST IN ADDING MORE GASOLINE POWERED OPTIONS TO ITS LINEUP AGAIN-
PORSCHE SAYS IT EXPECTS TO TAKE A HIT OF ABOUT 831 MILLION DOLLARS THIS YEAR.
PORSCHE’S HOLDING COMPANY HAS ALSO INCREASED THE PROJECTED LOSS THAT WILL BE TAKEN ON ITS EV INVESTMENT-
JUMPING FROM A LOW END ESTIMATE OF A LITTLE OVER A BILLION DOLLARS IN DECEMBER-
TO NOW AS MUCH AS 3.6 BILLION DOLLARS.
AS A RESULT, INDUSTRY EXPERTS BELIEVE SEVERAL OF THE AUTOMAKER’S TOP EXECUTIVES WILL SOON DEPART-
INCLUDING PORSCHE’S CHIEF FINANCIAL OFFICER, SALES CHIEF, AND CEO.
FOR MORE STORIES ABOUT THE ELECTRIC VEHICLE INDUSTRY, DOWNLOAD THE STRAIGHT ARROW NEWS APP AND SIGN UP FOR ALERTS FROM ME- JACK AYLMER.
