Porsche shares dropped more than seven percent on Monday after the company confirmed setbacks in its electric vehicle rollout. The automaker had already warned that weaker demand would weigh on its 2025 earnings.
Volkswagen also suffers
Parent company Volkswagen saw its shares fall by over seven percent on the same day. It announced billions in spending to update Porsche’s model line-up, raising investor concerns. The decline highlights the challenges European carmakers face from Chinese competitors and a slowing economy.
Profit outlook cut
Porsche reduced its profit margin forecast from as high as seven percent to two percent or less. It cited US tariffs, falling luxury sales in China, and slower EV adoption. Executives confirmed that several electric models will be delayed. Petrol models will remain in production longer despite Europe’s 2035 combustion ban.
Industry presses regulators
Manufacturers are urging European authorities to ease strict emissions targets. Porsche shifted its strategy, announcing its next SUV line will launch only with petrol and hybrid engines. Panamera and Cayenne models will also continue offering combustion options well into the 2030s.
Rising competition
BMW and Mercedes-Benz are cutting costs to stay competitive. Chinese brands such as BYD and XPeng are engaged in a price war. Average car prices in China have fallen 19 percent over two years, now around 165,000 yuan, or £17,150.
Slower path to electrification
Porsche’s latest update shows a retreat from its ambitious electric plans. Ten years ago, it unveiled the Mission E as a symbol of its future. Today, the company admits the transition will take much longer than originally planned.
