Porsche slows electric shift, dealing new blow to VW

AFP | Frankfurt

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German sports car maker Porsche said that it would slow its shift to electric vehicles amid weak demand, prompting its parent company Volkswagen to warn of a multibillion-euro hit.

Porsche announced a series of measures including delaying the introduction of some EVs and extending the life of some combustion engine and hybrid models.

"We're realigning Porsche across the board," said its CEO Oliver Blume. "In doing so, we want to meet new market realities and changing customer demands."

Volkswagen, which makes 10 brands of car including Porsche, said the changes to the sports car maker's EV plans along with other charges would negatively impact the overall group's operating results by 5.1 billion euros ($6 billion) in the 2025 financial year.

As a result of the changes, Volkswagen cut its forecast for operating profit margins -- closely watched by investors -- to a range of two to three percent for 2025, down from a previous forecast of four to five percent.

As well as a stuttering shift to EVs, Volkswagen has been battling weak demand and high costs in Europe, fierce competition in China and the impact of US President Donald Trump's tariffs.