Luxury sports car brand ‘blames EVs for its struggles’ – weeks after axing 4,000 jobs in desperate cost-cutting measure
A luxury carmaker is reportedly blaming EVs for the challenges it has been facing.
Reporting of recent struggles comes as the company announced plans to axe around 4,000 jobs earlier this month.
Despite being considered among the world’s most profitable automakers, Porsche has faced dropping sales, deep tariffs and stiff EV competition.
Experts have linked this to the company’s overly aggressive and inflexible electrification strategy.
Porsche has had a goal of being 80 per cent electric worldwide by 2030, but analyst at Warburg Research Fabio Hölscher has said this target is at the heart of its problems.
He told Automotive News: “Because the battery electric adoption is behind schedule, Porsche now has to develop additional combustion models on top of dealing with the costly delays in BEV ramp-up, as well as managing the weak situation in China and uncertainty around U.S. exports.”
As a result, Porsche cut 1,900 of its research and manufacturing jobs at German facilities in February.
Their revenue goals for this year were also cut by €2 billion, with an additional 8,000 jobs at stake.
Hölscher suggested with “a more flexible approach” with more plug-in hybrids and shared platforms like BMW, Porsche would have been able to better adjust to the rapidly shifting demand trends.
However, first-quarter sales fell 42 per cent compared to the same period last year.
It also delayed the arrival of a wave of its new electric products, including electric 718 Boxster and Cayman replacements and a three-row SUV.
Strong competition has been particularly seen in China against the German sports and luxury vehicle manufacturer.
This is because high horse-power EVs are surprisingly cheap, enabling electrification to see a surge in the Chinese market.
Cars like the Xiaomi SU7 Ultra and Yangwayg U9 provide four-figure horsepower and active suspension tech, whilst being relatively affordable.
For Vice President of Research Pedro Pacheco, Porsche’s “biggest problem is China”.
Along with recent job cuts, the company has also seen a shake-up of its executive team.
Former VW Group development boss Michael Steine became deputy chairman of Porsche’s executive board and its finance and sales bosses were replaced at the end of February.
CFO Dr Jochen Breckner said:“We are investing decisively in the future of Porsche – in products, software and measures that will strengthen us in the long term.
“The special expenses will have a short-term impact on our results.”