Money Matters, Simplified.
Porsche sales slide 28 percent
by Jamie Anderson - June 19, 2009 - comments
Porsche headquarters in Stuttgart, Germany. The manufacturer of luxury vehicles reported a 28 percent fall in sales for the August’ 08 to April’ 09 period
Frankfurt, Germany, June 19: Porsche Automobile Holding SE, the manufacturer of luxury, high performance automobiles, has reported 28 percent slump in its nine-month unit sales.
The August-to-April sales fell 28 percent year-on-year to 53,635 vehicles at the Stuttgart, Baden-Württemberg based automaker, highlighting the fact that even well to do customers turn their back to lavish items during periods of economic gloom.
The company reported a dip of 15 percent on a year-on-year basis. The plunge in revenue was less brutal compared to the dip in sales, primarily because of the fact that a larger portion of sales came from the high-margin 911 model.
In terms of units sold, the 911 model, too, slid by 18 percent. Major decline in demand was reported for the Cayenne sport- utility vehicles and Boxster sports cars.
The sales figures do not include those of Volkswagen brand, in which Porsche has a 51 percent stake.
Recession to blame
“In the first nine months of the ongoing fiscal year, the Porsche subgroup could not avoid the downward trend that has overtaken the worldwide automobile industry,” the company said in a statement.
“A look at global unit sales makes clear that no region is being spared the sharp decline in automobile markets,” Porsche added.
Porsche maintained that it is tricky to present a dependable outlook for the financial year. It, however, reiterated that earnings for the year are likely to decline as car sales drop. The drop in profits may accelerate if Volkswagen’s share price slides, the company said.
Liquidity crunch
Porsche's dwindling sales are all the more serious as the company faces a liquidity crunch. Porsche has been seeking an investor to infuse fresh capital in the company ever since it took over 9 billion euro ($12.5 billion) net debt to enhance its stake in Volkswagen AG (FWB: VOW).
Meanwhile, the outcome of the talks between Porsche and the Qatar Investment Agency (QIA) for a possible capital infusion is awaited.
The parleys with QIA may prove to be a vital step for Porsche to accomplish the Volkswagen venture.