Porsche, one of the world’s most famous car brands, is to delay its rollout of electric vehicles (EVs) in favour of new internal combustion engine (ICE) models, citing “massive changes within the automotive environment” and “a world with challenging conditions”.
The move, which is expected to hit the bottom line of both Porsche and parent company Volkswagen, has already caused a sharp slump in the share price of both companies.
It highlights the increasingly difficult environment European carmakers find themselves in due to lower than expected demand for battery EVs, growing competition from Chinese carmakers, and persistent trade barriers with both China and the United States.
Porsche CEO Oliver Blume, also the CEO of the Volkswagen Group, announced the so-called “strategic realignment” on Friday which hinges on supplementing the brand’s models with more combustion engine models than had previously been planned.
“Today, we have set the final steps in the realignment of our product strategy,” said Blume.
“We are currently experiencing massive changes within the automotive environment. That’s why we’re realigning Porsche across the board.”
“In doing so, we want to meet new market realities and changing customer demands – with fantastic products for our customers and robust financial results for our investors.”
The new SUV series above the Cayenne, previously intended to be fully electric, will now be initially offered exclusively as ICE and plug-in hybrid EV (PHEV) models at launch.
Current Porsche models such as the Panamera and the Cayenne will also continue to be sold with combustion engine and PHEV models “well into the 2030s”, with new generations of successor models added to the company’s ‘Cycle Plan’.
Doubling down on the sale of combustion engine and PHEV models eats directly into previous plans for all-electric models.
Porsche said that the “market launch of certain all-electric vehicle models is planned to take place at a later date” and that “the development of the planned new platform for electric vehicles in the 2030s is to be rescheduled” and “technologically redesigned in coordination with other brands within the Volkswagen Group.”
Blame for delaying its all-electric plans was laid at the feet of “the significant slower growth of the demand for exclusive battery-electric vehicles”, though the company said that its all-electric model range – including the Taycan, Macan, Cayenne, and the future two-door sports car in the 718 segment – “is being continuously updated”.
“This increases our flexibility and strengthens our position in a currently highly volatile environment,” said Blume. “With a convincing mix of combustion engines, plug-in hybrids, and battery-electric vehicles, we want to meet the entire range of customer requirements.
“In the medium term, this approach is intended to support our business model and strengthen our market position.”
The delay of electric models, however, will not be a panacea for Porsche, which pointed to a range of external factors – including US import tariffs, a decline in the Chinese luxury market, and “the slowdown in the ramp-up of electric mobility” – as burdens to its overall economic outlook.
Porsche is now expecting its operating profit in the 2025 financial year to be slashed by up to €1.8 billion. Parent company Volkswagen will also take a €5.1 billion hit from Porsche’s product overhaul.
Joshua S. Hill is a Melbourne-based journalist who has been writing about climate change, clean technology, and electric vehicles for over 15 years. He has been reporting on electric vehicles and clean technologies for Renew Economy and The Driven since 2012. His preferred mode of transport is his feet.
