Porsche (P911_p.DE) saw its shares fall by 7.5% by late morning on Monday after the carmaker scaled back its electric vehicle rollout and lowered its forecast, following a costly strategic reversal driven by weak demand.
Volkswagen, Porsche’s parent company, and its holding company Porsche SE (PSHG_p.DE), the largest shareholder of Volkswagen, both saw declines of 7% and 7.6%, respectively.
Porsche announced a delay in the launch of several all-electric models on Friday, marking further trouble for the company. Its profits were almost wiped out in the second quarter, facing pressure from China, its key market, and higher U.S. tariffs.
The strategy shift is projected to reduce operating profits by up to 1.8 billion euros ($2.12 billion) this year. Porsche now expects its 2025 profit margin to be no more than 2%, down from an earlier forecast of 5% to 7%.
Some analysts viewed the guidance cut as inevitable, given the pressure on Porsche to prolong the life of its combustion engine due to weak demand for electric vehicles. However, Porsche has stated that it expects the realignment to benefit the company in the medium to long term.
CORRECTING THE EV 'MISTAKE'
At the IAA auto show in Munich, the Porsche logo was displayed on a vehicle at the exhibition pavilion. The company said the overhaul would result in a 5.1 billion euro hit for Volkswagen, its 75.4%-owned subsidiary.
Volkswagen lowered its profit margin outlook to 2% to 3%, down from the previous range of 4% to 5%, while Porsche SE also revised its profit after tax forecast.
Jefferies analysts suggested that Porsche’s outlook revision – the third of the year – may be the last but warned that it could face product cycle and brand challenges. With much of the 1.8 billion euro charge expected to hit in the third quarter, the analysts anticipate a loss for Porsche in the second half.
One local trader called the strategic decision "inevitable" and cautioned that the company had become too reliant on electric vehicles. "The correction of the former mistake to become too dependent on EVs will take time," the trader added, speaking on condition of anonymity.
Problems at Porsche and Volkswagen have led shareholders to call for Oliver Blume to end his dual role as CEO of both companies.
Iran's Supreme Leader, Mojtaba Khamenei, has promised to avenge the killing of his father, while U.S. President Donald Trump said Tehran and Washingto...
The U.S. Department of Justice has ordered several New York Times journalists to testify before a federal grand jury. ...
At least 44 people have died and more than one million have been stranded due to widespread flooding and landslides across southeastern Bangladesh, au...
The U.S. Department of Justice has ordered several New York Times journalists to testify before a federal grand jury.
At least 44 people have died and more than one million have been stranded due to widespread flooding and landslides across southeastern Bangladesh, authorities said on Saturday (11 July).
More than 100 countries now spend more on servicing debt than on education, UNESCO has warned, as it called on governments and international lenders to expand the use of debt-for-education swaps.
South Africa international midfielder Jayden Adams, who helped Bafana Bafana reach the knockout stages of the 2026 FIFA World Cup for the first time, has died at the age of 25.
At least 12 people have been killed in forest fires in Almeria in southern Spain, Andalucía’s emergency agency has said, as firefighters continue efforts to put out the blaze.
U.S. President Donald Trump said Washington has agreed to resume talks with Iran after Tehran requested further negotiations, but declared that last month's ceasefire between the two countries was "over".
The U.S. military said on Wednesday it launched fresh strikes on Iran to keep the Strait of Hormuz open to shipping, triggering Iranian attacks on Kuwait and Bahrain in the latest escalation to derail efforts to end the war.
Dozens of flights have been cancelled across East Asia as Super Typhoon Bavi approaches China. The typhoon, which has maximum sustained winds of 162 kph (100mph), is nearing a remote chain of Japanese islands, east of Taiwan on Friday.
What began as a fan-created chant just months ago has become one of the defining images of this year's FIFA World Cup, with Norway's "Viking Row" sweeping through stadiums, city streets and social media.
China has approved fast-fashion retailer Shein's long-awaited initial public offering (IPO) in Hong Kong, clearing the way for the company to pursue a stock market listing after previous attempts in the U.S. and London failed.
European carmakers have urged the European Union to make sure new “Made in EU” rules do not put existing investments in Türkiye and Morocco at risk.
Microsoft is expected to announce a new round of job cuts as early as next week as the technology giant looks to reduce costs, according to reports.
A Swedish court has ordered Alphabet-owned Google to pay about $1.5 billion in antitrust damages to price comparison platform PriceRunner, in one of Europe's largest competition-related awards against a major technology company.
U.S. President Donald Trump earned more than $1bn from cryptocurrency-related business ventures last year, according to his mandatory 2025 financial disclosure.
You can download the AnewZ application from Play Store and the App Store.
What is your opinion on this topic?
Leave the first comment