European Auto Industry in Winter! Porsche's Financial Report Shocks with Double Decline, China Sales Plunge by Nearly 30% π
Folks, just how tough is the European auto industry this year? Look at Porsche's financial report and you'll know.
The third-quarter revenue and net profit both declined, and the market expectations were not good to begin with, but the results were worse than imagined. In the first three quarters, a total of 226,000 vehicles were delivered, a decrease of 7% year-on-year. Except for the 911 and Cayenne, other models saw a decline in sales, with the Panamera dropping by 19.7%. π
Against the backdrop of a double-digit global increase in electric vehicle sales, Porsche's electric vehicle sales are becoming harder to sell. Besides the German market and the European market excluding Germany, both North America and China are seeing declines, especially in China, where the drop is close to 30%. π
Let's take a look at the profits. In the third quarter, Porsche's global revenue was 9.1 billion euros, a decline of 6%, and the net profit was 612 million euros, a year-on-year decline of 48%. The cumulative net profit for the first three quarters was 2.765 billion euros, a year-on-year decline of 29.8%. Last year's gross margin was 28.6%, and the net profit margin was 37%. This year, due to price reductions, both gross and net profit margins have declined, with the full-year net profit margin at only 6.7%. π±
It's not just Porsche; Mercedes-Benz and BMW Group's financial reports are also under pressure, with net profits declining by 52.3% and 85.5%, respectively. The market value of the three European giants has been falling for months, and even a century-old giant like Bosch is planning layoffs. The decline in the European auto industry is obvious. π
However, the domestic data is quite different. In 2021, the output of new energy vehicles was 3.677 million, and this year, the cumulative output for the first ten months is 9.9 million. We have become the world's largest market and manufacturing base for new energy vehicles. Last year, our car exports were 4.91 million, surpassing Japan to become the world's largest car exporter. In the first four months of this year, exports were 4.855 million, an increase of 23.8%. π
The automotive industry in Europe and the United States has been strong for hundreds of years, but in the past two years, our catching-up speed has been rapid. The rise of domestic cars is visibly replacing the share of foreign-funded manufacturers. The rise of China's automotive industry has become an unstoppable trend. π