E-car blackout

Jobs & models wobble: Things are crumbling at Porsche

(Bild: picturedesk.com/APA/dpa/Jan Woitas)

The car manufacturers have been delivering a series of bad news: Volkswagen in crisis, Audi plant closures, Mercedes cutting billions, Ford cutting thousands of jobs, the Stellantis restructuring seems to have failed. And now Porsche is suddenly on fire too!

But things didn't look so precarious recently. According to Automobilwoche, Porsche achieved an operating return on sales of 14.1 percent in the first nine months of 2024 "that many other companies can only dream of. But the third quarter was weak."

Zuffenhausen is also lamenting the slump in demand in China. The decline in the Middle Kingdom amounted to around 30 percent by September, with a strong upward trend. China is virtually collapsing.

"In China, a premium combustion car that costs 70,000 to 80,000 euros is competing with Chinese vehicles in the e-segment, which are being pushed onto the market for 30,000 euros and also have a lot to offer," the industry newspaper quotes Porsche CFO Lutz Meschke. German brands are becoming increasingly less important.

The redesigned Porsche Taycan is significantly better than before - and yet it is not making any headway.

(Bild: Stephan Schätzl)

Porsche actually wanted to sell 80 percent electric cars by 2030. Ambitious.

Home-made model problems
To a certain extent, the fact that things are not going so well is also home-made. The Porsche Taycan became a slow seller due to its high prices and low range; the revised version now does a lot better, but the baby seems to have already fallen into the well. And the market launch of the Macan electric SUV has been delayed by two years due to software problems. Now the car that was supposed to pull the coals out of the fire is launching in the middle of a demand slump.

There are also problems with the electric Porsche 718. No new platform is to be used for the electric versions of the Boxster and Cayman; instead, the existing one has to be used. However, they are not making much progress with the revision, as Automobilwoche claims to have learned. Time schedule? Not a chance.

The sticking point is the placement of the battery. Battery supplier Valmet Automotive has built its own factory in Baden-Württemberg. However, the Finns are now complaining that Porsche is constantly demanding adjustments, but apparently does not want to pay for "significant additional costs", or only in part. It is questionable whether the electric version will be ready by the time the combustion-powered 718 is discontinued in summer 2025.

And then there is the question of why customers should buy an electric Porsche if the loss in value is so immense that it is a case of burning money. "After all, luxury is also defined by the stability of the product's value," a Porsche manager, who does not wish to be named, told Automobilwoche.

But more investment in combustion engines?
Because they are delaying the electric cars, pushing combustion engine technology to the limit could be a solution, according to insiders in the industry magazine. The Cayenne platform, on which the VW Touareg and Audi Q7 are also based, could be completely renewed once again. Previously, only cosmetic adjustments were planned for future emissions regulations to allow for an overlap.

The electric version was planned for 2026, but is also likely to be delayed. Contrary to previous plans, the Panamera, which has only just been launched on the market as the supposedly last pure combustion engine, could also receive a successor after 2030. The same applies to the 911.

In addition, a previously unplanned seven-seater luxury SUV with a combustion engine on the Cayenne platform could be put on track in the short term. Such a model is actually planned on an electric platform - but it may not reach customers in the USA and Vhina until years later, rather than 2027.

End for Taycan in Zuffenhausen?
Porsche built a factory specifically for the Taycan at its headquarters in Zuffenhausen as a flagship project for which employees even took a pay cut. Now production could be relocated to Leipzig. 1000 temporary workers have already been sent home for good.

There is still no word of further job cuts at Porsche, but Automobilwoche calculates that 20 percent of jobs are in jeopardy based on the decline in sales. That would be 8000 employees. Only in China are they laughing up their sleeves.