Porsche's ambition for 2030: More than 80 percent all-electric new vehicles

03/18/2022

Over the past financial year, Porsche AG has underpinned its position as one of the world's most profitable automobile manufacturers. The Stuttgart-based sports car manufacturer reached a new all-time high in both sales revenue and operating profit.

Sales in 2021 were €33.1 billion, €4.4 billion more than in the previous year, representing growth of 15 percent (previous year's sales: €28.7 billion). Operating profit was €5.3 billion, exceeding the previous year's figure by €1.1 billion (plus 27 percent). Porsche thus generated an operating return on sales of 16.0 percent (previous year: 14.6 percent).

Net cash flow grew by €1.5 billion to €3.7 billion in 2021 (previous year: €2.2 billion). "This indicator also provides impressive proof: Porsche is excellently positioned," says Lutz Meschke. The positive development is also based on the ambitious 2025 profitability program. This is designed to sustainably support earnings through new innovations and business models. Meschke: "Thanks to our highly motivated employees, our profitability program has been a complete success. Porsche has further increased its efficiency and lowered the break-even point. This gives us the leeway to invest in the future viability of our company despite the tense economic situation. We are resolutely driving forward investments in electrification, digitalisation and sustainability. I am optimistic that Porsche will emerge from the current global crises stronger."

The tense world situation calls for humility and caution: "Porsche is looking at the armed conflict in Ukraine with great concern and dismay," says Oliver Blume. "We continue to hope for a cessation of hostilities and a return to diplomacy. The safety and integrity of the people are paramount." To help people in need in Ukraine, Porsche AG has donated a total of €1 million. Experts are continuously determining the degree of impact on Porsche's business activities in a task force.

"We have challenging months ahead of us, both economically and politically, but we are nevertheless sticking to our strategic goal, which has been firmly anchored for years, of ensuring an operating return on sales of at least 15 percent in the long term," emphasized CFO Lutz Meschke. "Our task force has already taken initial measures to safeguard our earnings. In this way, we want to ensure that we can continue to meet our high earnings targets. The extent to which this succeeds also depends on external challenges that we cannot influence." Internally, however, Porsche has created all the conditions for a successful business model: "Strategically, operationally and financially, Porsche is in an excellent position. We are therefore looking to the future with confidence – and welcome the consideration of an IPO of Porsche AG. This would allow Porsche to raise its profile and increase its entrepreneurial freedom. At the same time, Volkswagen and Porsche could continue to benefit from joint synergies in the future."

In 2021, Porsche delivered 301,915 vehicles to customers worldwide. This means that the 300,000 mark was exceeded for the first time in the company's history (previous year: 272,162 deliveries). The bestselling models were the Macan (88,362) and the Cayenne (83,071). Delivery figures for the Taycan more than doubled: 41,296 customers took delivery of the first all-electric Porsche. This even overtook the iconic 911 sports car, although the latter also set a new record with 38,464 units.

Oliver Blume: "The Taycan is 100 percent a Porsche and inspires all kinds of people – existing and new customers, experts and the trade media. We are stepping up our electric offensive with another model: By the middle of the decade, we want to offer our mid-engine 718 sports car exclusively in an all-electric form."

Last year, almost 40 percent of all new Porsche vehicles delivered in Europe were already at least partly electric – i.e. plug-in hybrids or fully electric models. In addition, Porsche had announced its intention to be carbon-neutral on the balance sheet in 2030. "In 2025, half of all new Porsche sales are expected to come from the sale of electric vehicles – i.e. all-electric or plug-in hybrid," announced Oliver Blume. "In 2030, the share of all new vehicles with an all-electric drive should be more than 80 percent." To achieve these ambitious goals, Porsche is investing in premium charging stations together with partners – and additionally in its own charging infrastructure. Further extensive investments are flowing into core technologies such as battery systems and module production. In the newly founded Cellforce Group, high-performance battery cells are being developed and produced that are expected to be ready for series production by 2024.

In 2021, Porsche increased its deliveries in all global sales regions. Once again, the highest-volume individual market was China. With almost 96,000 deliveries, an increase of eight percent was recorded here compared to 2020. Porsche grew rapidly in North America: In the United States, the number of deliveries rose by an impressive 22 percent to more than 70,000 units. A very positive development was also observed in Europe: In Germany alone, Porsche increased its new vehicle deliveries by nine percent to almost 29,000 units.

The Collection, a high-end, multi-brand dealership in the Miami area, is suing Porsche for $300 million following alleged attempts to coerce it into building a standalone dealership for the German automaker.

The suit revolved around Florida franchise law, which prevents automakers from requiring dealers to establish exclusive facilities, reports Autonews. The Collection alleges that Porsche asked it to build an exclusive location in Kendall or Cutler Bay, which are both south of Coral Gables, where its 350,000-square-foot main building is located.

​​​​​​​The dealer described these as “remote, suburban locations” that have “relatively zero market for Porsches,” so it declined to comply. It claims that Porsche then withheld all pool-car allocations.

Porsche says that pool cars are assigned to dealers at the factory’s discretion and typically account for no more than 20 percent of available inventory. Another Porsche dealer, who spoke on condition of anonymity, said that the vehicles give the automaker the ability to “reward dealers who are doing a great job and curtail people that don’t want to do what the manufacturer wants."

The dealer added that it would be improper for Porsche to allow The Collection to go on operating as usual after successfully convincing all other U.S. Porsche dealers to construct standalone stores.

“It would be unfair to allow [The Collection] to operate in a void at a different cost structure,” the dealer said. “They can’t make 194 [dealers] build and then let one guy off for some reason.”

In a letter filed with the lawsuit, Porsche Cars North America COO, Joe Lawrence, implied that the decision not to assign pool cars was related to The Collection’s decision not to build a standalone dealership.

The Collection’s refusal shows its “unwillingness to meaningfully engage in best business practices and promote the Porsche brand,” Lawrence wrote. “As a result, it should come as no surprise that we continue to withhold discretionary assignment of pool cars to The Collection.”

The dealership, meanwhile, said that the automaker’s decision to withhold pool cars could cause more than $100 million in damages, since allocation is related to sales. By refusing to allocate it these vehicles, the automaker is allegedly condemning the dealership to a “death spiral” that has already seen it go from the number three American Porsche dealer in 2018, to the 32nd best-performing as of June. Porsche‘s COO, however, argued that the dealer’s declining sales had to do with the brand’s retail expansion in the U.S. and a nationwide decrease in Porsche sales.

“Florida Porsche dealers are generally experiencing a steeper decline than the national trend,” Lawrence said.

Porsche has a new crest, and it will be introduced on the sports car maker's vehicles at the end of 2023. By new, we mean slightly tweaked because changing the crest of arguably the best sports car builder in the automotive industry would be stupid. Instead of pulling a Buick, the designers of Style Porsche and the marketing department came together to modernize the iconic logo.

"The '75 years of Porsche sports cars' anniversary was the occasion for us to rework this trademark," says Michael Mauer, Vice President of Style Porsche. "With its cleaner and more state-of-the-art execution, the refined crest communicates the character of Porsche. We have reinterpreted historical characteristics and combined them with innovative design elements such as a honeycomb structure and brushed metal. The result is an aesthetically ambitious arc that bridges the history and the future of the brand."

The Porsche crest has existed since 1952 and was updated in 1954, 1963, 1973, 1994, and 2008. All of these crests can still be purchased. Porsche is famous for looking after customers that own its vintage cars and constantly introducing updates for older models.

The new crest is made from brushed precious metal, and the stallion in the middle has been given a slight upgrade along with a more in-your-face reference to where Porsche is based. The rising horse is borrowed from the seal of the city of Stuttgart, while the antlers and black-and-red stripes were taken from the crest of Wurttemberg-Hohenzollern. Porsche made the "Stuttgart" lettering less visible in 2008, but now it's back. The gold color is more subtle, while the red stripes have been given a three-dimensional honeycomb design.

It takes a real Porsche nerd to identify the differences between the crest currently found on the nose of the beloved 911 and the updated one that will be pasted to its nose at the end of the year.

Our resident Porsche fanboys were able to identify the differences immediately. It's still instantly recognizable, which means a great deal of thought and attention to detail went into the design. Three years to be exact, according to Porsche.

"The time factor is very important in a maturing process such as this," said Joachim Paetzel, Specialist for Colour and Trim at Style Porsche. "A trademark is not designed 'off the cuff' within a few days. You have to go back to it again and again, sometimes at longer intervals. The second or third look can reveal to you things that you want to optimize until it finally achieves a harmonious, natural effect. Only then can you say with satisfaction: 'This is exactly how it has to be!'"

Why now? According to Porsche's Chief Marketing Officer, Robert Ader, the brand will adopt a new brand identity at the 75th Porsche sports car anniversary show on June 8, 2023.

"The Porsche crest is an unmistakable symbol and simultaneously a central element of our brand identity," said Ader. "For this reason, the modernized crest became the occasion for us to rework our brand design."

Porsche is on the cusp of reinventing itself, and the German brand may choose the sports car anniversary to introduce "the sports car of the future," which may be the all-new, all-electric 718 Boxster and Cayman successor. The Macan is also going electric, and the Cayenne recently received one final significant facelift before it also adopts electrification.

Fear not, for internal combustion will likely always be a part of Porsche's DNA. The brand will use synthetic fuel to keep the 911 alive and well, but even so, the model split will eventually be 20% gas and 80% EV.