29-04-2025
Porsche cuts full-year outlook, warns of further uncertainty on US tariffs
German luxury sports car maker Porsche slashed a series of forecasts for 2025, hit by a toxic mix of weakness in its main market China, rising supply chain costs and US tariffs that are disrupting the global car industry.
Porsche late on Monday said US import tariffs, in place since April at 25%, weighed on its business in April and May, and warned its adjusted outlook does not factor in the future effects of tariffs.
"It is not yet possible to make a reliable assessment of the effects for the financial year," Porsche said.
The US tariffs are expected to raise car prices by thousands of dollars, reducing demand and hurting job growth, rattling an automobile industry struggling with a slowing transition to electric vehicles.
In April, Porsche, which has no US production, said it had shipped added inventory to the US to get ahead of tariffs and kept prices constant for orders made in March.
Porsche said it expects revenues of between €37bn (R781,101,080,000) and €38bn (R802,519,720,000) in 2025, down from its previous forecast of €39bn (R823,638,660,000) to €40bn (R844,799,600,000). Its profit margin is forecast to plunge to 6.5& to 8.5%, down from a previous forecast of 10% to 12%.
According to the average analyst estimate in LSEG, Porsche's operating margin is seen at 9.7% on revenues of €38.8bn (R819,455,612,000).
The carmaker, which at its stock market debut in 2022 had a higher valuation than its parent company, Volkswagen AG, has fallen from grace since, struggling in particular with low sales in China, its top market, where first-quarter sales dropped 42%.
Bill Russo, CEO of Shanghai-based advisory firm Automobility, said Chinese customers of electric cars had been drawn to their domestic brands because of their improved technological offering.
"No foreign company believed the Chinese could somehow build equity that was superior to the foreign brands, specially the Europeans," he said.
Porsche also said it would no longer pursue plans to expand high-performance battery production at its Cellforce subsidiary, and cited a decline in demand in China for all-electric luxury cars.
