Porsche has revised its financial outlook for 2025, attributing the change to a challenging first quarter marked by a downturn in China, increased supply chain costs, and the impact of US tariffs on the automotive sector.
The German sports car manufacturer has reported a drop in group sale revenue in Q1 2025, ending 31 March, to €8.86bn ($10.01bn) from €9.01bn in the previous year’s corresponding quarter.
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The decline in sales revenue by 1.7% was attributed primarily to the group’s lower vehicle sales combined with positive price and individualisation effects.
Its operating profit saw a significant decrease to €760m from €1.28bn in the same period a year ago. The group’s operating return on sales of 8.6%, a decline from 14.2% in the prior year’s same quarter.
The company stated that its business results were affected by the current economic and political landscape, as well as internal adjustments.
Porsche delivered a total of 71,470 vehicles in the first three months, down from 77,640 in the same period last year.
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By GlobalDataHowever, the share of electrified vehicles delivered rose to 39%, with all-electric vehicles accounting for 26% and plug-in hybrids for 13%.
Porsche Finance and IT executive board member Dr Jochen Breckner said: “As we expected, the first quarter has been weaker. In addition, the macroeconomic situation will remain challenging. We can’t completely escape this, but we are doing everything within our power to counteract it.”
US tariffs, which have been in effect since April at 25%, are anticipated to increase car prices significantly, potentially reducing demand and impacting job growth in the automotive sector, reported Reuters.
Porsche has decided to halt expansion plans for high-performance battery production at its Cellforce subsidiary. This decision is attributed to a decrease in demand for all-electric luxury cars in China, according to Reuters report.
In a press statement, Porsche said: “The introduction of US import tariffs leads to negative impacts for the months of April and May 2025 which are included in the adjusted forecast.
“However, the adjusted forecast does not take into account further effects of the introduction of US import tariffs. Currently it is not yet possible to make a reliable assessment of the effects for the financial year.”
As per the revised financial forecasts for the year 2025, Porsche now anticipates sales revenue to range from €37bn to €38bn, down from the previously projected €39bn to €40bn. The expected return on sales has been adjusted to 6.5% to 8.5%, a decrease from the earlier estimate of 10% to 12%.
The forecast for the automotive net cash flow margin has been lowered to 4% to 6%, compared to the initial 7% to 9%.
Additionally, the automotive EBITDA margin is now projected to be between 16.5% and 18.5%, which is less than the former forecast of 19% to 21%.
However, the anticipated share of battery electric vehicles (BEVs) in the automotive segment remains unchanged at 20% to 22%.
Last month, Porsche announced its plans to cut workforce by approximately 3,900 positions to improve profitability. The carmaker intends to reduce its workforce by around 1,900 positions by 2029.
