Porsche warns push into electric cars will hit profits
Porsche has warned that its shift away from petrol cars will impact profits, as investment in electrification drives up costs.
The German carmaker said profit margins would be between 15pc and 17pc in 2024, down from 18pc in 2023.
It comes as Porsche battles to reach its target of EVs accounting for four in five sales by the end of the decade.
Porsche said it was in a “good position” as carmakers switch to electric, but added: “The associated high level of investment in the digital, sustainable and electrified future of the company and the planned product launches mean that the [company] faces a challenging year in 2024.”
The Stuttgart-based company, which is majority-owned by Volkswagen, said battery-powered cars currently make up a relatively small proportion of sales, despite a recent overhaul of its lineup.
It said electric cars would account for between 13pc and 15pc of total new vehicle sales this year, which is up narrowly from 12.8pc in 2023.
However, this remains significantly below its target of electric cars accounting for 80pc of all sales by 2030, at which point it will have phased out many of its petrol-powered models.
Porsche recently unveiled an electric version of its popular Macan SUV, which will go on sale later this year.
Earlier this week it also revealed an updated version of the electric Taycan sports car first released in 2019. It is also introducing a hybrid version of its iconic 911 in the early summer.
The company says it will be launching more new cars this year than at any point in its history.
Lutz Meschke, its chief financial officer, said: “We’re laying the groundwork in 2024 for a flying start in 2025.”
Sales in 2023 rose by 7.7pc to €40.5bn (£34.6bn) while operating profits were up by €7.3bn. The number of cars sold rose by 3.3pc to 320,221.
Shares leapt by 3.4pc on Tuesday, trading roughly at the same level as when the luxury car maker went public in 2022.
It came as reports said Japanese car manufacturers Nissan and Honda were slashing production in China as motorists turn to domestic EVs.
Nissan is considering cutting production capacity in China by 30pc while Honda plans to reduce output by 20pc, Nikkei reported.
The companies’ sales in China have been falling in recent years amid the rise of homegrown manufacturers such as BYD, which last year overtook Tesla as the world’s biggest producer of electric cars.
