A deepening crisis at Porsche AG has weighed heavily on its top shareholder, Porsche SE, cutting profit by more than a third in the first nine months of 2025.
Porsche SE, which owns 12.5% of Porsche AG and controls 53.3% of Volkswagen’s voting rights, reported a 36% fall in adjusted profit after tax to 1.6 billion euros ($1.87 billion).
The holding company blamed the drop on mounting costs at both Porsche AG and Volkswagen, hit by a delayed electric vehicle (EV) rollout and weak demand in China, the world’s biggest auto market.
Families’ Fortune Feels the Strain
Controlled by the Porsche and Piech families, the Stuttgart-based holding company said the luxury carmaker’s strategic shift toward new EV models has caused short-term pain but could drive long-term gains once demand stabilises.
Volkswagen and Porsche have faced billions in added costs this year as they work to refresh their EV lineups and navigate tougher Chinese competition.
“We improved our financing structure to remain strong even in this challenging automotive environment,” said Johannes Lattwein, Porsche SE’s finance chief.
Net debt down as focus shifts
Despite the earnings hit, Porsche SE reduced its net debt by 3% to 5 billion euros in the first nine months of 2025. The company maintained its full-year outlook, holding firm after a September profit warning linked to Porsche AG’s EV strategy overhaul.
The group said it is also exploring defence investments to diversify its portfolio, taking advantage of a surge in global defence spending since 2022.
German auto industry at a crossroads
While defence companies such as Rheinmetall are thriving amid rising military orders, Germany’s auto giants face a tougher road. Sluggish EV demand, higher tariffs, and global supply chain issues are testing their ability to adapt.
Still, analysts say Porsche SE’s financial discipline and diversification plan could help protect long-term shareholder value.
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