Porsche Increases Profits Despite CrisisOctober 30, 2020
Despite the global crisis caused by the coronavirus pandemic, Porsche’s operating result for the first three quarters of 2020 reached € 2.0 billion.
With a turnover of 19.4 billion euros, the carmaker’s profitability in the past nine months was 10.4 percent. Although the operating result was 28 percent lower than last year, Lutz Meschke, Deputy Chairman of the Management Board and responsible for finance and IT at Porsche AG, was satisfied with the performance.
“We benefit from the fact that continuous optimization of all processes is an integral part of our philosophy. Thanks to the increased efficiency, Porsche was able to achieve double-digit profitability despite the tense situation in the automotive industry, ”Meschke emphasizes.
Oliver Blume, Chairman of the Management Board of Porsche AG, cites a convincing product policy as another factor contributing to the success. In the first nine months, 25,400 Nine Hundred Elevenths were sold, which is 1 percent more than last year. The Porsche Taycan electric sports car entered the market in September 2019. Almost 11,000 Taycans were handed over to customers between January and September.
Porsche has sold 191,547 units worldwide since the beginning of the year, down 5 percent from 2019. In this way, Porsche was able to confine itself to only a slight decrease in sales compared to the rest of the market. The Chinese market, which quickly recovered after the quarantine, played a positive role here. From January to September, 62,823 vehicles were sold in China, representing almost a third of Porsche’s total sales. Demand in other markets is also growing markedly.
Despite the general market tension, Porsche continues its targeted investments in digitalisation and electrification. Over the next five years, 15 billion euros will be invested in new technologies. “Although these costs reduce our current bottom line, in doing so we secure the future of the company in the long term, as well as jobs,” emphasizes Lutz Meschke. In addition to unfavorable market conditions, changes in exchange rates also had a negative impact on the current result. However, the company is not abandoning its strategic goal of 15 percent profitability, Meschke notes “In 2020 this is not realistic due to the impact of the coronavirus pandemic, but thanks to our long-term strategic approach, we are confident that we will achieve double-digit profitability at the end of the year “.
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