(Reuters) -German luxury sports car maker Porsche slashed a series of forecasts for 2025, hit by a toxic mix of weakness in its main market China, rising supply chain costs and U.S. tariffs that are disrupting the global car industry.
Porsche late on Monday said U.S. import tariffs, in place since April at 25%, weighed on its business in April and May, and it warned that its adjusted outlook does not factor in the future effects of tariffs.
“Currently it is not yet possible to make a reliable assessment of the effects for the financial year,” Porsche said.
The U.S. tariffs are expected to raise car prices by thousands of dollars, reducing demand and hurting job growth, rattling an automobile industry already struggling with a slowing transition to electric vehicles.
In April, Porsche, which has no U.S. production, said it had shipped added inventory to the United States to get ahead of tariffs and kept prices constant for orders made in March.
Porsche said it now expects revenues of between 37 billion and 38 billion euros in 2025, down from its previous forecast of 39 billion to 40 billion euros. Its profit margin is forecast to plunge to 6.5-8.5%, down from a previous forecast of 10-12%.
According to the average analyst estimate in LSEG, Porsche’s operating margin is seen at 9.7% on revenues of 38.8 billion euros.
The carmaker, which at its stock market debut in 2022 had a higher valuation than its parent company, Volkswagen AG, has fallen from grace since, struggling in particular with low sales in China, its top market, where first-quarter sales dropped 42%.
Bill Russo, CEO of Shanghai-based advisory firm Automobility, said Chinese customers of electric cars had been drawn to their domestic brands because of their improved technological offering.
“No foreign company believed that the Chinese could somehow build equity that was superior to the foreign brands, especially the Europeans,” he said.
Porsche also said it would no longer pursue plans to expand high-performance battery production at its Cellforce subsidiary, and it cited a decline in demand in China for all-electric luxury cars.
Porsche is scheduled to release first-quarter results later on Tuesday.
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(Reporting by Gnaneshwar Rajan in Bengaluru, Tom Sims and Christoph Steitz in Frankfurt and Victoria Waldersee in Stuttgart; Editing by Alan Barona, Leslie Adler and Sonali Paul)
