AutoBeta(AutoBeta.net)07/26 Report--

On July 24, Porsche released its results for the first half of this year. According to the report, Porsche's total revenue in the first half of the year was 19.46 billion euros, down 4.8 per cent from a year earlier. Operating profit in the first half of the year was 3.06 billion euros, down 20.5% from a year earlier, and the operating return was 15.7%, down 3.2% from 18.9% in the same period last year. In terms of sales, global sales in the first half of this year were 155900 vehicles, down 6.8 per cent from a year earlier. Among them, there has been a sharp drop in sales in the Chinese market, with sales of only 29600 vehicles in the first half of the year, down 33 per cent from a year earlier.

For the report, officials said that after a decline in the first quarter, operating returns rebounded to 17 per cent in the second quarter, at the upper limit of expectations. Porsche's operating return was 14.2% in the first quarter. Driven by a good performance in the second quarter, the operating return in the first half was more than 15%. Porsche responded to the sharp drop in sales in the Chinese market: this is mainly due to the decline in sales in the Chinese market and the switch between new and old models.

In fact, it is not surprising that Porsche's performance figures for the first half of the year are not satisfactory. As early as early July, officials announced global sales in the first half of this year. At that time, official figures showed that Porsche sales declined in both North America and China in the first half of the year. China, Porsche's main sales market, has been declining since 2022. Data show that total sales in China fell 2.5% year on year to 93286 in 2022, making it the only Porsche market in the world to decline. Porsche sold 320221 vehicles worldwide in 2023, up 3% from the same period last year, but sales in China have not improved and are still declining. Porsche sold 79283 vehicles in China last year, down 15 per cent from a year earlier.

Of course, Porsche's decline in sales in the Chinese market has something to do with the slow electrification transformation and the shrinking market share of fuel vehicles for the rapid development of domestic new energy vehicles. Porsche announced its electric transformation in 2019, when it launched its first all-electric sports car, the Taycan, in the same year, but sales of the first model were not satisfactory. Figures show that only 4151 Taycan models were sold in China last year. Judging from Porsche's product mix, most of its sales still come from fuel models. With the acceleration of domestic electrification transformation, the demand for domestic fuel vehicles has been reduced, and the demand for imported fuel vehicles has also declined significantly.

The decline in sales and the inability to sell pure electric models have also put pressure on domestic Porsche dealers to sell their cars at a loss. Porsche dealers in China also launched mass protests and boycotts in May because of this issue. At that time, the official response said: Porsche is committed to value growth-oriented development, to speed up the electrification process. In the process of this transformation, Porsche hopes to work side by side with long-term dealer partners to face various challenges, support each other and achieve win-win development. Porsche will unswervingly put the interests of its customers first and work together with dealers to meet the challenges of the market and seek development. "

Recently, in addition to appeasing domestic dealers, officials have also made adjustments in terms of personnel, products and performance targets. On July 20th, it was officially announced that Alexander Alexander Pollich would replace Michael Kirsch as Porsche's CEO in China. Responsible for the company's business in mainland China, Hong Kong and Macao. According to officials, Alexander Polic has a wealth of sales experience. The announcement of first-half results comes a day after the government lowered its performance target for this year. Sales fell to 39 billion-40 billion euros from an earlier estimate of 40 billion-42 billion euros, while the rate of return on sales fell to 14-15 percent from an earlier forecast of 15-17 percent.

At the same time, in terms of product planning, it abandoned its earlier goal of increasing the share of electric vehicle sales to 80% by 2030. Officials say a number of electric models will continue to be launched in the coming years, but the transition to electric vehicles does appear to be slower than expected, with 80 per cent of the target commitment being too aggressive.

On the performance of the Chinese market, Porsche CEO Oliver Bloom (Oliver Blume) has said that while the Chinese market still faces challenges, it does not intend to join a price war to cope with market changes. The global cost structure will be assessed in the future and priority will be given to adjusting the strategy. Bloom believes Porsche is on track to achieve its medium-term return on sales target of 17-19 per cent by 2025. Judging from the official statement, Porsche is still very optimistic about the follow-up performance of Porsche in China, but in fact, with the rise of new domestic car-building forces, the market share of traditional luxury brands has been obviously threatened, in other words, the time left for luxury brands to transform is already very tight. In the face of this series of challenges, how should Porsche break the game?

Welcome to subscribe to the WeChat public account "Automotive Industry Focus" to get the first-hand insider information on the automotive industry and talk about things in the automotive circle. Welcome to break the news! WeChat ID autoWechat