Porsche believes that it will be able to maintain its current profit levels and lead the industry when it comes to e-mobility.
During an interview with Automotive News, Porsche chief financial officer Lutz Meschke said that the German carmaker will cut costs and invest over 3 billion euros ($3.5 billion) into electric vehicles and plug-in hybrids.
“To protect your margin, you have to look at substantial fixed cost cuts, but there’s only so much potential since the biggest chunks are personnel and development. As sales shift toward EVs, a temporary drop in profitability in the midterm may be expected.”
When quizzed about the importance of maintaining its 15 per cent profit margin in the EV age, Meschke said it is crucial for the company to have a specific target to chase.
“It’s a strategic target. We need to structure the company so that it is in position to sustainably achieve that…
“It’s better for Porsche to work with a fixed margin target. We attach incentives for the average worker to it, and there’s even a pension component. It’s really an internal steering instrument. That’s why everyone in the company from the manager to the assembly line worker knows the goal is 15 percent. If we work with a range, that effect is diluted,” he said.
Porsche’s first all-electric production vehicle will be the eagerly-awaited Mission E. Revealed as a concept over two years ago, the car will directly rival the Tesla Model S and offer blistering performance and handling. Thanks to a pair of electric motors, it will deliver over 600 hp and be capable of reaching 124 mph (200 km/h) in 12 seconds. A range of 330 miles (531 km) is also being targeted.
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