Porsche Shifts to Fuel and Hybrid Models

Porsche plans to launch new fuel-powered and plug-in hybrid (PHEV) vehicles after its electric models failed to gain the desired momentum.

The sports car manufacturer has warned that new internal combustion engine models and battery development expenses will harm profits this year, leading to a decline in stock prices.

After announcing that it expects profit margins to range between 10% and 12% this year, Porsche stated that it is taking "intensive measures" to boost profits in the short and medium term.

These expectations are significantly lower than Porsche"s long-term goal of achieving an operating return on sales of over 20%. To enhance profits, the company announced plans to add new gasoline-powered (combustion engine) and plug-in hybrid vehicles to its lineup.

Porsche warned that the new models and additional investments in batteries will impact profits this year, costing an extra 800 million euros ($830 million).

This shift comes after Porsche"s sales declined by 3% last year, with China, one of its most important markets, leading the downturn. Deliveries in China fell by 28% as the company failed to keep up with local electric vehicle manufacturers such as BYD, Xiaomi, and XPeng.

Last week, Porsche announced that it is in discussions to terminate the contracts of CFO Lutz Meschke and Detlev von Platen, head of sales and marketing.

After launching the updated 2025 model last year, Porsche sold just over 20,800 units of the Taycan, a decrease of nearly 50% compared to 2023. Porsche also began selling its second electric vehicle, the Macan, at the end of September, and this car is expected to help alleviate some of the pressure this year.

Following the updated guidance, Porsche"s stock suffered one of its worst days since its listing in 2022. The company, which was previously valued higher than its parent company Volkswagen, has seen its market value halve from its all-time high in May 2023.