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Introduction: Porsche CEO said: "If the Chinese electric vehicle luxury car market cannot develop, we will be prepared for the internal combustion engine and hybrid vehicle luxury car market."

(Text/Zhou Shengming Editor/Gao Xin)

On July 24, local time, Porsche's official website released its performance for the first half of 2024. Data showed that Porsche's revenue in the first half of the year was 19.46 billion euros, a year-on-year decrease of 4.8%; operating profit was 3.06 billion euros, a year-on-year decrease of 20.5%; operating return rate was 15.7%, compared with 18.9% in the same period last year.

In terms of quarters, Porsche's operating income in the second quarter was better than the previous quarter. The operating sales return rate in the second quarter was 17.0%, higher than 14.2% in the first quarter and higher than the previous market expectation of 16.6%.

It is worth noting that due to the impact of a combination of factors such as the shortage of aluminum parts and weak demand in the Chinese market, Porsche has lowered its full-year 2024 performance outlook. Porsche expects the return on sales in 2024 to be at most 15%, compared with the previous upper limit of 17%, and sales revenue to be between 39 billion euros and 40 billion euros, compared with the previous estimate of between 40 billion euros and 42 billion euros.

Affected by this, Porsche's stock price fell 7.7% on Tuesday, marking the biggest intraday drop since its listing in September 2022.

Porsche Chief Executive Oliver Blume said Porsche was hit harder than rivals by the shortage of raw materials because of its high pre-order ratio, low sales and diverse configurations.

The shortage was reportedly caused by flooding at a major European supplier's production facilities, but Porsche did not name the company.

Porsche Chief Financial Officer Lutz Meschke said the sales decline could not be made up within a few months, forcing Porsche to lower its sales profit margin forecast. Lutz Meschke also said that Porsche's situation will be "completely different" after the launch of new models in the next few years. He added that Porsche is confident that it will achieve its profit margin target of 17%-19% by 2025.

In addition, Porsche's electric vehicle strategy has not met expectations. Oliver Blume said: "The electric vehicle transition has clearly lost momentum and speed."

In terms of pure electric new cars, the Porsche Macan EV will be launched in September this year. Oliver Blume said that the order volume of the car is "very considerable" and the launch of the new model will help boost sales. At the same time, Porsche emphasized that it still adheres to the goal of achieving 80% of electric vehicle sales by 2030, but the final sales volume depends on market demand.

In the Chinese market, in the first half of 2024, Porsche's deliveries in the Chinese market were 29,600 vehicles, a significant year-on-year decrease of 33%, and sales have declined for five consecutive quarters.

Oliver Bloom said he reached an agreement with dealers during a visit to China last weekend to offer performance-linked incentives to boost sales, and was considering launching new internal combustion engine models for the Chinese market.

"If the Chinese electric vehicle luxury car market fails to develop, we will be prepared for the internal combustion engine and hybrid vehicle luxury car market because we have high profit margins in these areas," Bloom said.

According to Reuters, Porsche executives were extremely dissatisfied with the decline in sales performance in the Chinese market. Subsequently, Porsche China's president and CEO were replaced.

According to an announcement released by Porsche on July 20, Alexander Pollich will replace Michael Kirsch as President and CEO of Porsche China from September 1 this year, fully responsible for the brand's business in mainland China, Hong Kong and Macau. Kirsch will be transferred to another important position within the group.

Alexander Pollich, 57, has worked at Porsche for 23 years. He has served as Chairman of the Executive Board of Porsche Deutschland GmbH since July 2018. Before taking charge of Porsche's home market in Germany, he also served as CEO of Porsche Canada and the UK, successfully expanding the brand's business in both places. In addition, Alexander Pollich also worked in Porsche's strategic department, engaged in the development of the global market sales network.

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