Analyst Claims Electrification is the Cause of Porsche’s Current Crisis

Porsche has been one of the biggest and most reliable brands when it comes to luxury vehicles. It was a brand that symbolized tradition, continuity, but also authenticity and innovation, as the company has been able to push boundaries on more than one occasion.

But the current situation is rough. We’ve recently reported that the company is bracing for a difficult future, as the volatile market might be hitting them more than some other major manufacturers.

In a recent interview, analyst Fabio Hölscher suggested what the potential reason for this crisis could be, and his answer might surprise you.

As you probably know, the company has been a pioneer when it comes to EVs, and it was one of the world’s leading EV manufacturers in an era when EVs were still fighting to become the dominant type of vehicles, so that the environment could relax a bit.

But, with Trump’s return to power, things have changed. It’s not just the tariffs, although it is also the tariffs, but it’s not just them. Trump also opened a front against EVs in general (the Tesla-related irony obviously escapes him) and against Joe Biden’s policies related to EVs.

And while it remains to be seen how effective his methods will be, the EV market has taken a hit, especially in the West. Namely, the demand for EVs has plunged in recent months and many companies are now reconsidering their stances towards pure EVs and hybrids. And this is where Hölscher finds the problem for Porsche.

“Because the battery electric adoption is behind schedule, Porsche now has to develop additional combustion models on top of dealing with the costly delays in BEV ramp-up, as well as managing the weak situation in China and uncertainty around U.S. exports,” he says.

The fact that Porsche has been relying on EVs so much – you’ve probably heard about Porsche’s goal of going 80 percent electric worldwide by 2030 – might have hurt them in these volatile times, causing potential problems.

With the market being in a state of chaos and cheaper Chinese alternatives being available, customers aren’t really keen on spending that much money on luxury EVs, if they even want to buy an EV.

The company has been firing people in recent months and it is difficult to predict how big of an impact this is going to have for them. Hölscher believes that a more flexible approach with more hybrid cars might have done the trick for Porsche as it did for other companies, like BMW, but what’s done is done.

Porsche definitely has time to reconsider its strategies going forward, but they will certainly take a couple of hits in the upcoming months.

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