Porsche Drives Strategic Shift While Holding Dividends
Porsche AG advanced its strategic transformation at its third Annual General Meeting on 21 May, with CEO Dr Oliver Blume outlining its refined product and corporate roadmap. This updated direction, designed to ensure long-term profitability and resilience, reflects a clear response to ongoing global economic pressures. “The world has changed. We are experiencing a fierce storm. But we are doing everything we can to counteract them. We are resolutely investing in the future,” Dr Blume told shareholders. “In challenging times, we continue to develop Porsche with a precise focus. This requires more resources in the short term, but it will make our company even more profitable in the long term. We accept the challenge. We have a plan. We are acting. And we’re not wasting any time.”
To address shifting market conditions, Porsche launched a broad strategic realignment. It plans to expand its model range to include more plug-in hybrids and combustion engine vehicles alongside electric models. This diversification comes as the global transition to electric mobility proves slower than anticipated. Porsche will also reposition its battery operations and implement a significant cost and rescaling programme, targeting a reduction of around 3,900 jobs by 2029. In the second half of the year, management and the works council will begin negotiating a structural framework to boost long-term efficiency. These moves, including significant investment in new product development, will incur special charges of €1.3 billion in the 2025 financial year. “This has a noticeable impact on our earnings, but we accept that,” Dr Blume affirmed. “It is necessary to ensure that Porsche remains robust and highly profitable.”
The reshaping of Porsche’s Executive Board began in February 2025. Dr Jochen Breckner replaced Lutz Meschke as Board Member for Finance and IT, while Matthias Becker succeeded Detlev von Platen in Sales and Marketing. Further changes will follow: Dr Michael Steiner, who has overseen Research and Development since 2016, will become Deputy Chairman of the Executive Board on 1 July 2025. He will step down from leading Group Development for the Volkswagen Group. Vera Schalwig will assume Human Resources and Social Affairs responsibility on 19 August 2025, while Joachim Scharnagl will take over procurement.
Despite headwinds, Porsche AG posted strong financial results in 2024. Group sales reached €40.1 billion, while operating profit stood at €5.6 billion. The operating return on sales settled at 14.1 per cent. Net cash flow from automotive operations remained high at €3.7 billion, nearly matching the record set in 2023. Ordinary shares returned €3.94 in earnings, and preference shares yielded €3.95. “Under such difficult conditions, the 2024 result was a powerful performance by the whole Porsche team,” said Dr Blume. “Porsche proved in 2024 that the company is highly profitable and financially robust, even in challenging times.”
Porsche also demonstrated resilience in vehicle deliveries. In 2024, it delivered 310,718 vehicles globally, with four regions—Europe, Germany, North America, and Overseas and Emerging Markets—achieving record sales. A decline in Chinese demand slightly reduced overall figures. The Cayenne led sales with 102,889 units, followed by the Macan and the 911. Dr Blume highlighted, “Since December 2023, we have renewed five of six model lines and comprehensively rejuvenated our product portfolio. We have laid the foundation for our success in the coming years.” Porsche will continue offering a balanced mix of combustion, hybrid, and electric vehicles well into the 2030s. “I can reveal one thing,” he added. “We will be raising the bar in the sports car segment once again.”
In April, Porsche updated its 2025 forecast in light of one-off effects. The company expects consolidated sales of €37–38 billion, an operating return on sales of 6.5–8.5 per cent, and a net cash flow margin of 4–6 per cent. It also anticipates an automotive EBITDA margin of 16.5–18.5 per cent and a battery-electric vehicle share of 20–22 per cent.
Dr Wolfgang Porsche, Chairman of the Supervisory Board, acknowledged the hurdles ahead: “The situation in the automotive industry remains challenging, and Porsche is not immune to this. At the same time, our brand continues to have great appeal. We are all called upon to successfully master the challenges ahead.” Consistent with the previous year, the Executive and Supervisory Boards will propose a dividend of approximately €2.1 billion for the 2024 financial year—€2.30 per ordinary share and €2.31 per preference share—maintaining a target of distributing around 50 per cent of net income to shareholders.