Porsche rolls out plans to pump fossil fuel profits into electric car creation
SAN FRANCISCO — The powerful new Porsche 911 GT3 RS’s 500-horsepower gasoline engine can blast a driver from zero to 62 mph in 3.2 seconds.
How fast can the German automaker manage the transition to a future of electric vehicles and robot-driven cars?
The company addressed that question in its hometown of Stuttgart earlier this month, laying out plans to double investment in “trends for the future” with all-electric and plug-in hybrid cars accounting for 25 percent of new car sales by 2025.
Porsche has been on a roll, with significant expansions in its sales, profits and employee base over the past five years. Its financial cushion will be used to finance the strategic transition.
“We are using our high earnings level to support an unprecedented future development plan,” Porsche Chairman Oliver Blume said in the company’s hours-long annual earnings announcement meeting, which also serves as a product introduction gala.
The Porsche brand is well known worldwide. It sold 246,375 of its expensive, highperformance vehicles in 2017, generating 4 percent higher revenues of $21 billion, compared with 2016. Its operating profit rose 7 percent to $5 billion, or a stunning $20,000 on each car.
The company has a particularly avid following in California, which accounted for 24 percent of the 55,470 cars it sold in the U.S.
Porsche will invest $3.75 billion in new technology in the next four years, as much as it has to date, Blume said The money will be spent on derivatives of the upcoming all-electric Mission E sedan, adding hybrid versions of existing gasoline models, electric charging technology, and “smart mobility” including new digital services.
Like other automakers, Porsche is under pressure from existing and pending regulations around the globe forcing it to cut greenhouse gas emissions and other pollutants. Electric car technology is currently the surest route to cleaner air, but although EV interest is growing, the vast majority of new vehicle buyers today prefer internal combustion engines.
Porsche sells some of the most sophisticated and powerful internal combustion engines in the world. But executives believe electric cars, which offer tremendous torque from a stationary position, will appeal to sufficient numbers of Porsche buyers to make its new investments worthwhile.
Detlev von Platen, Porsche’s head of sales and marketing, said he initially wasn’t sure an EV could match internal combustion cars for pure driving pleasure. That was years ago. The powertrains provide a different driving experience, but he said a test drive in a high-end EV will attract plenty of new fans. “You will get into the car with some skeptical attitude and get out of the car with a big smile,” he told The Times in a telephone interview.
The trick for Porsche, he said, is making sure its EVs are well-balanced sports cars. Simple torque and horsepower won’t cut it. He looks forward to matching Porsche’s EV offerings against competitors on Germany’s famous Nurburgring Gran Prix track in Germany.