Porsche CEO Admits Major Strategy Failure as China Sales Collapse
Porsche is facing a significant crisis in China, a market that was once its most profitable stronghold. The German luxury automaker has seen its sales figures plummet, with recent reports indicating a drop of nearly 30 percent in 2024 alone.
CEO Oliver Blume recently admitted that the company “got it wrong” regarding its approach to the Chinese market. In a candid statement, he acknowledged that their aggressive growth strategy and product planning did not align with the rapid shifts in local consumer demand.
A primary factor in this downturn was the decision to transition key models, such as the Macan, exclusively to electric powertrains too quickly. This move left Porsche without flexible combustion-engine alternatives just as Chinese buyers began favoring domestic brands that offer advanced technology at lower price points.
Local competitors like Xiaomi and BYD have eroded Porsche’s market share by delivering high-tech electric vehicles that appeal more to younger, tech-savvy consumers. Blume noted that the luxury segment in China has effectively collapsed by around 80 percent, leaving traditional European automakers struggling to compete.
To mitigate the damage, Porsche is now restructuring its dealership network in the region and rethinking its electric-only targets. The company is also looking to cut costs and potentially extend the lifespan of its combustion engine models to regain stability.
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