Slow EV sales stymie Porsche’s profits

PORSCHE says its refocus on internal combustion and plug-in hybrid power will impact profits over the coming calendar year.

The German luxury manufacturer is set to take a €800 million ($A1.31b) hit as it pivots back to producing petrol, diesel and plug-in hybrid drivelines for model lines it had planned to be fully electric.

Facing low demand for battery electric vehicles in Europe – and stiff competition from Chinese models – the company said it will develop new internal combustion engine derivatives across its portfolio to meet customer demand.

Porsche will now invest in combustion-engine versions of its Cayenne and Macan SUVs, and Panamera sedans, which were originally intended to be electric-only in their new generations.

A future large fully electric SUV codenamed K1 – and likely to sit above the Cayenne in Porsche’s line-up – will also get a combustion engine option.

The news follows earlier reports that Porsche had planned a round of cost cuts amid a weakening economy, growing competition from China, and a slower-than-expected EV transition.

It is understood the company could cut as many as 8000 jobs through voluntary redundancies.

Porsche is the latest in a long list of manufacturers winding back plans to go fully electric.

Ford CEO Jim Farley announced earlier this week that the Blue Oval would scale back plans for its Model E electric range as losses of $US5 billion ($A8 billion) hit its bottom line.

Ford will instead move to offer range extender versions of select models, including the F-150 Lightning which has suffered from what Mr Farley described as the “slow uptake of EVs”.

Alfa Romeo is also reported to be abandoning its EV-only plans, the Italian manufacturer moving toward a “multi-energy strategy” in the face of slow EV demand, while Smart this month announced a similar strategy, moving to offer a plug-in hybrid version of its formerly EV only #5.

All electric OEM Tesla has also noted diminishing returns, but without an internal combustion driveline to fall back on will instead look to incentivising current stock to recoup costs.

Tesla’s situation comes at the same time US electric vehicle manufacturer Canoo files for Chapter 7 bankruptcy, joining previously bankrupted start-ups including Arrival, Fisker, and Lordstown Motors.

Other EV-only manufacturers facing hardship include Lucid, Faraday Future, and Nikola.

Lucid remains deep in the red with reported 2024 third quarter losses of $US992.5 million ($A1.6b), while Faraday Future runs on a knife-edge, the company managing to secure $US30 million ($A47.8m) in financing in December of 2024.

The once $US34 billion ($A54.2b) valued Nikola Corporation is now worth just $US100 million ($A160m) after range-wide recalls of its heavy electric truck range and deceptive practices saw shareholders walk away.

With Automotive News Europe.