Car industry Porsche posts lower profit due to weak business in China
Sports car manufacturer Porsche's profit has collapsed in 2024. Consolidated profit fell by 30.3 percent to around 3.6 billion euros, as the DAX-listed company announced in Stuttgart. In 2023, Porsche had still made a profit of around 5.2 billion euros.
12.03.2025, 08:19
SDA
The reasons for the loss included poor business in China and high costs for the renewal of model series. Turbulent weeks lie behind the company: In February, Porsche first announced that it would be reorganizing its Executive Board. The long-standing Chief Financial Officer Lutz Meschke and Chief Sales Officer Detlev von Platen had to leave.
Shortly afterwards, it was announced that the VW subsidiary was adjusting its strategy and, among other things, investing more money in combustion engines and plug-in hybrids again. In addition, around 1900 jobs are to be cut at the main plant in Zuffenhausen and the Weissach development center by 2029.
Turnover also declining
Porsche had already presented preliminary figures and the forecast for the current year. In addition, the parent company Volkswagen had also reported key figures for its subsidiary the previous day. Volkswagen also earned significantly less on the bottom line in 2023 than in the previous year, with a drop of almost 31 percent.
Porsche's deliveries fell by three percent to around 310,700 vehicles in 2024. In China, the decline was 28 percent. Turnover fell by 1.1 percent to just over 40 billion euros, while profit in day-to-day business fell by almost 23 percent to 5.64 billion euros.
Porsche was therefore also less profitable: the operating return on sales - i.e. the ratio of profit in day-to-day business to turnover - was 3.9 percentage points below the previous year at 14.1 percent. This means that the company has moved further away from its long-term target of more than 20 percent.
The new CFO Jochen Breckner said: "Porsche has proven in 2024 that we are highly profitable and financially robust even in challenging times". In the medium term, however, the sports car manufacturer is becoming more cautious.
No quick recovery in sight
As already announced, Porsche intends to invest around 800 million euros this year in order to turn its flagging business around with new models and a cost-cutting program. Blume therefore expects the operating margin to fall to between 10 and 12 percent. Turnover is likely to amount to 39 to 40 billion euros.
