Development costs to narrow Porsche’s profit image

As Porsche is heavily investing in future models, VW’s sports-car brand is expecting lower profits on mid-term, Chief Executive Oliver Blume said.

The first full electrically powered Porsche is on its way and the sports-car maker is investing about 1 billion euros to build it, creating also over 1,000 new jobs at its base in Zuffenhausen. Furthermore, the company has a lot of new products on its mind, as it is pushing for further growth in the future, Chief Executive Oliver Blume revealed this week. With such plans undergoing, Porsche will have to lower its profit expectations in the coming years. “Therefore it’s clear that we can no longer carry out major leaps on results,” the CEO said.

Even if the margins are to be narrowed, Porsche will probably still remain the second-biggest contributor to Volkswagen Group’s profit. With 225,121 units delivered to customers world-wide, the company achieved a new record in 2015, exceeding the previous one of 189,849 cars in 2014 by 19 percent. And with more than 80,000 models sold, the Macan SUV became the most coveted Porsche already in the first year of full availability. “Porsche has delivered a great result,” Blume said with regard to the carmaker’s 2015 annual earnings, due to be published on March 11.

But, at this moment, Porsche has to overcome the stop-sale issued in the United Sates for its 3.0-litre V6 diesels affected by the emissions scandal. The company expects feedback from the US regulators “in the next weeks” on proposals to fix about 13,000 Cayenne SUVs, Blume said.

Via Reuters