Porsche acknowledges the failure of its strategy with electric cars, what now?
While all brands have corrected their course in electric matters, at Porsche the situation has taken on a somewhat more dramatic tone due to the impact it has had on its financial situation, even within the Volkswagen Group.
In recent years, we have witnessed a widespread “pulling the plug” by Western car brands. With the ban on combustion cars in Europe by 2035, manufacturers rushed to jump on the electric vehicle bandwagon.
However, the market situation, with uncertainty in Europe, a cooling of demand (more pronounced last year), tariffs on both sides of the world… has dampened brands' expectations.
Porsche was one more on the list, but the impact of its latest decisions is considerable, to the point that it has caused the largest drop in its shares since 2022 in Germany.
Porsche reverses its electric plans
At Porsche, they were very optimistic about the electric car: by 2030, their entire range would be dominated by 100% electric vehicles, with few exceptions like the 911. But as we said, the situation changed over the years.
They presented the spectacular Taycan and later launched the second generation of the Macan SUV exclusively in electric. The poor results of this last model have even led them to work on a combustion alternative.
But there’s more: those in Stuttgart were working on new generations of their 718 Cayman and Boxster sports cars as pure electric and on a luxury SUV, the K1, with the same technology.
Porsche recently hit the “panic button” and announced that neither the combustion engines nor the plug-in hybrids would come to the rescue of these future models.
The Volkswagen Group also affected
What’s the consequence? The change in direction has generated a deficit of 1.8 billion euros in the company’s operating profit and a 9.3 percent drop in the value of its shares this week (and 30 percent so far this year).
Moreover, the German brand has once again cut its profit forecasts for the fourth time in 2025. The results of the VW Group, which owns 75.4 percent of Porsche, have also been affected.
Their electric strategy was too aggressive and now their reversal means not only continuing to bet on combustion engines but also developing a new generation of engines to continue attracting the public. Something that is truly costly and that shareholders do not fully see clearly.
Porsche has faced everything at once, as the saying goes: luxury car buyers are saying no, for now, to electric technology; in China, their main market, they have completely fallen behind local manufacturers; and Trump's tariffs represent another blow to the company’s flotation line.
And to make matters worse, Oliver Blume's position at Porsche, CEO also of the VW Group, hangs by a thread, with pressure for him to resign from his position at the Stuttgart manufacturer. It is clear that such tumultuous movements in a range as limited as Porsche's have had a direct effect on their situation. “Where I said I say, I say Diego,” but with millions of euros at stake, course changes are very costly.
