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Porsche's stock plummeted over 7% on Monday, a direct result of last week's profit warning. The luxury carmaker attributed the reduced profit margin projection—down from as high as 7% to 2% or less—to several factors including US import tariffs, a weakening Chinese luxury market, and delays in its electric vehicle rollout. These delays will also see a postponement of new EV launches and a continued production run of combustion engine models, despite the looming 2035 ban on new petrol and diesel car sales in Europe.
Caught between electrification and its iconic petrol-powered sports cars, the German firm said it will slow its push for EVs as demand weakens. Shares of its parent Volkswagen also fell by more than 7% on the same day after saying it will spend billions to overhaul Porsche's line-up of vehicles.
The companies' struggles reflect the challenges for European manufacturers, who are faced with intense competition from Chinese rivals and a slowing economy that's dampening demand for luxury cars.
Manufacturers have put pressure on European authorities to lower emission targets, arguing that they were not feasible.
In a strategic shift, Porsche said an upcoming line of sport utility vehicles, originally planned as fully electric, will now launch exclusively with combustion engines and plug-in hybrid options.
Current models like the four-door Panamera and Cayenne will continue to be available with non-electric options well into the 2030s, it added.
Luxury carmakers BMW and Mercedes-Benz have also been slashing costs to keep up with rivals.
European carmakers are facing fierce competition from Chinese brands like BYD and XPeng, which are caught in a price war in the domestic EV market.
Many international carmakers have struggled to compete in China, where average car prices have dropped by an estimated 19% over the past two years to around 165,000 yuan (£17,150; $23,190).
Porsche's latest statement suggests it was easing off its electric goals, having unveiled its first electric concept car, the Mission E, a decade ago.
