Porsche Deliveries Drop 10% in 2025 Amid Weak EV Demand

Porsche, Volkswagen’s luxury brand, reported a 10% decline in vehicle deliveries in 2025, marking its largest drop since 2009. The company delivered 279,449 vehicles last year, with China and Germany leading the declines, reflecting weak demand for electric vehicles (EVs) and supply gaps affecting combustion-engine models.

Porsche cited supply shortages for combustion versions of the 718 sports car and Macan SUV as limiting sales. Challenges also arose from an overly ambitious EV rollout, which disrupted production plans and pressured profit margins. In addition, US tariffs, in the country that has now surpassed China as Porsche’s largest market, further weighed on earnings.

The decline comes amid management changes. Michael Leiters, former CEO, McLaren Automotive, became Porsche CEO on Jan. 1, ending VW CEO Oliver Blume’s dual role. CFO Jochen Breckner said in October that while 2025 represented a low point, Porsche aims to return to double-digit margins in the years following 2026.

Porsche’s performance also impacts parent company Volkswagen AG, which relies heavily on profits from premium brands, including Audi. Volkswagen withdrew its 2025 outlook four times and has fallen out of Germany’s DAX index. The decline highlights the challenges automakers face when pursuing rapid EV expansion while balancing supply chain issues and international tariffs.

German automakers endured a severe year, facing their most serious crisis since World War II. High energy costs, technological delays, and rising Chinese competition forced factories to close and tens of thousands of jobs to be cut. China has shifted from growth market to competitor, with local brands like BYD and Xiaomi offering advanced digital features and battery technology at lower prices. German market share has fallen from 25% to roughly 15% over five years.

Technological and operational gaps exacerbate the situation. German automakers lag in software and EV platform rollouts, while high energy and labor costs reduce competitiveness. Bureaucracy and a third consecutive year of recession limit the industry’s ability to respond quickly.

Volkswagen plans to cut 35,000 jobs and reduce capacity by roughly 700,000 units. Mercedes-Benz targets up to 16,600 global layoffs under its “Next Level” program, and suppliers like ZF, Bosch, and Continental have announced thousands of reductions amid collapsing EV orders. In 2025 alone, the industry shed over 55,000 jobs, including Audi’s 7,500 cuts in Germany, while Ford ended production at its Saarlouis plant.

Automakers Shift EV Strategies 

Porsche is not alone in recalibrating EV plans. In the United States, EV sales fell roughly 40% in November 2025 after the expiration of a US$7,500 federal tax credit that had supported EV adoption for more than 15 years.

Stellantis also adjusted its approach. In September 2025, Jean-Philippe Imparato, head of Stellantis Europe, confirmed the company would abandon its 2030 target of fully electric sales, citing EU 2035 carbon emissions targets as “no longer achievable for any carmaker.”

Ford announced a US$19.5 billion writedown and a reset of its EV strategy, replacing the fully electric F-150 Lightning with an extended-range EV using a gasoline engine for battery recharging, canceling its next-generation T3 electric truck, and abandoning electric commercial vans. CEO Jim Farley noted the shift was triggered by rapid market changes.

General Motors also faced EV-related challenges, taking a US$1.6 billion charge in October to adjust factory plans, with more potential charges anticipated. Stellantis canceled an electric Ram pickup and refocused on hybrids, while other traditional automakers returned to gasoline and hybrid models to limit losses. Analysts suggest these moves may benefit pure EV makers like Tesla and Rivian, though within a shrinking total market.

US automakers are increasingly exploring energy storage markets, leveraging EV battery technology to store electricity for homes, businesses, and utilities, supporting grid stability amid growing renewable generation and rising power demand. Companies including Ford, GM, and Tesla are pursuing new revenue streams in this segment.