About performance
Despite multiple challenges such as the COVID-19 pandemic, chip supply shortages and rising raw material prices, Porsche's global revenue and profit in FY2021 reached record highs.
- Revenue climbed to EUR 33.1 billion, an increase of EUR 4.4 billion from FY2020 (EUR 28.7 billion), an increase of 15% year-on-year.
-Profit from sales increased by EUR 1.1 billion to EUR 5.3 billion, or 27%, compared to the previous fiscal year (EUR 4.2 billion).
- Return on sales of 16.0%, above the long-term strategic target of 15%. (FY2020: 14.6%)
Net cash flow in the automotive sector grew strongly, up 67 percent year-on-year to EUR 3.7 billion in fiscal 2021.
Net liquidity in the automotive business grew to EUR 5 billion, an increase of EUR 2 billion from the previous fiscal year.
New vehicle deliveries reached a new record of 301,915 units (FY2020: 272,162 units), an increase of 11% year-on-year, and all major sales markets contributed positively to this.
- China topped Porsche's largest single market in the world, with 95,671 new vehicles delivered, up 8% year-on-year.
- The Macan became the best-selling model, delivering 88,362 new vehicles worldwide, up 13% year-over-year.
- Porsche's first all-electric sports car, the Taycan, is selling well worldwide, with new car deliveries more than doubling in 2021 compared to 2020 to 41,296 units.
The "Profit Plan 2025" has been very effective, and Porsche has further improved its profit efficiency. More than 3,000 specific suggestions were received from employees, many of which have already been adopted. This is not a simple cost control plan, but an innovation of the entire company's processes, the development of new business ideas and increased profitability.
Mr. Obermou is Chairman of the Executive Board of Porsche Worldwide
Oliver Blume, Chairman of the Executive Board of Porsche AG
About the development of the company
Porsche is on the fast track to electrification and ramping up its electrification product offensive
- In the mid-1920s, the 718 series is planned to be fully electrified. The new generation of the 718, despite being electrically driven, will continue to use common components, which means that the future 718 and 911 series will still be produced on the zuvenhausen two-door sports car assembly line.
- Porsche also plans to launch a hybrid model of the 911, focusing on a very dynamic way of driving, similar to hybrid racing cars in racing.
- More ambitious electrification product targets:
About one in every four new porsches delivered worldwide in 2021 will be all-electric or hybrid, compared to nearly 40% in Europe.
By 2025, half of Porsche's new global deliveries are expected to be electrified, both electric and hybrid.
By 2030, the proportion of pure electric models in new car deliveries is expected to reach more than 80%.
Continue to drive future-oriented projects and investments:
- Porsche has allocated EUR 15 billion for electric mobility and digital transformation by 2025.
- Expansion of the charging infrastructure network: The deployment of Porsche's own charging infrastructure in Europe; the first sites have been confirmed in Germany, Austria and Switzerland.
- The Company invested in Cellforce to develop a new high-performance battery, which is scheduled to start production in 2024.
- Invested in Porsche Werkzeugbau to produce battery modules at a factory in Slovakia and plans to start construction in the middle of next year.
- Porsche has invested in Rimac since 2018. In November 2021, the Bugatti Rimac joint venture was approved, with the Rimac Group holding 55% of the joint venture and Porsche holding 45% of the shares. Bugatti and Rimac cars will continue to operate as independent brands and manufacturers.
Actively embrace the era of digital intelligence and build Porsche digital assets with a pioneering spirit
- Talent pool: Porsche worldwide and its subsidiaries employ more than 5,000 people specializing in IT and digitalization, attracting the world's MOST talented IT talent
- Three areas of focus for Porsche Digital
Make your company's processes faster, leaner, and more flexible.
Deliver great products to your customers and engage them with compelling software and connected services.
Further digitize customer interfaces.
- A two-pronged digital transformation strategy
Partner with the world's leading high-tech companies.
Relying on internal R & D strength. For example, Industrial Cloud Solutions, developed jointly with MHP subsidiaries, translate advanced production and logistics expertise into software that helps industrial customers improve efficiency and achieve sustainable, resource-saving production. In addition, Porsche Digital is working with the sales department to create Porsche's NFT (Non-Homogeneous Token) platform to provide highly emotional digital products related to the Porsche brand.
- Promote artificial intelligence into vehicle development, production and daily internal workflows
Mr. Obermu, Chairman of the Porsche Global Executive Board (left), Mr. Maxig, Vice Chairman and Member of the Porsche Global Executive Board, Responsible for Finance and Information Technology (right)
Oliver Blume, Chairman of the Executive Board of Porsche AG, Lutz Meschke, Deputy Chairman of the Executive Board and Member of the Executive Board responsible for Finance and IT of Porsche AG
Future outlook
- Despite the tense political and economic situation, Porsche is committed to its strategic goal of achieving a return on sales of at least 15% per annum in the long term. Of course, the ultimate extent to which this goal is achieved depends on many external challenges that are not controlled by human beings.
- Porsche has set up a working group to continuously study the development of the situation and introduce countermeasures. At present, the first measures to protect revenue have been implemented, hoping to ensure that the company continues to meet the requirements of high yields.
Given the current global landscape, any predictions for 2022 deliveries and business data are premature.
- For Porsche, sales are not the primary target. More importantly, we are confident that we will stimulate our customers' enthusiasm for sports cars with desirable products while striving for maximum profitability and efficiency.
- Porsche will drive transformation in line with Strategy 2030, continue to strengthen the principles of sustainability and customer orientation, and maintain high profitability.
In a difficult market environment, Porsche has maintained its workforce at a level close to 37,000.
- Employment regulations provide employment protection for Porsche's core employees worldwide until 2030. In 2021, Porsche expands its employment protection to more subsidiaries.
- We also plan to gradually reduce the weekly working hours of employees at the Leipzig plant to 35 hours by 2025.
- Porsche went with every employee in the transformation and did not make layoffs. Porsche is one of the most popular employers in all industries in Germany. Awarded "Top Employer in China" for three consecutive years.
Mr. Obermou, Chairman of the Porsche Global Executive Board (left) and Mr. Maxig, Vice Chairman and member of the Porsche Global Executive Board, responsible for Finance & Information Technology (right) publishes porsche business revenue data for FY2021.
Oliver Blume, Chairman of the Executive Board of Porsche AG, and Lutz Meschke, Deputy Chairman of the Executive Board and Member of the Executive Board responsible for Finance and IT of Porsche AG, announced the figures for the 2021.
On sustainability:
Porsche is committed to the Paris Climate Agreement and has set ambitious targets – by 2030, Porsche aims to be carbon neutral across the entire value chain and the life cycle of new cars sold.
Porsche's decarbonisation programme follows the principle of prioritizing the avoidance and reduction of CO2 emissions, with the final step being to compensate for them.
Porsche is a pioneer in sustainable mobility, constantly developing innovative concepts that reduce CO2 emissions.
- In 2030, the proportion of all new cars delivered by Porsche is expected to exceed 80% of pure electric models.
- Porsche is committed to carbon neutrality during the vehicle use phase. The Taycan Cross Turismo became the first Porsche model to be carbon neutral throughout its entire phase of use. Other model series will also be promoted.
- Porsche takes a holistic view of the development of electric mobility and signs contracts with energy suppliers to support the expansion of the use of green renewable energy.
- In achieving carbon neutrality across the value chain, Porsche also uses synthetic fuels as a logical complement to the electrification process. eFuels makes the driving of models with internal combustion engines nearly carbon neutral.
For upstream supply chains, Porsche's direct suppliers require green electricity in the production of Porsche components.
Porsche's three main sites are carbon neutral in their production processes.
- Since 2020, the plant in Zuffenhausen has been carbon neutral in its production processes.
- At the beginning of 2021, the Leipzig plant and the Weissach R&D center also achieved carbon neutrality.
About the IPO listing plan of Porsche AG
Volkswagen AG decided to study the possibility of Porsche AG listing on the stock exchange. The Executive Board of Porsche AG welcomed the decision. This also highlights Porsche's very successful development.
For Porsche, this move can enhance brand image and value, as well as increase the freedom of the company. Volkswagen AG will also benefit from the listing of Porsche AG. The IPO will give the Volkswagen Group additional flexibility, which will help to further accelerate the transformation. Porsche and Volkswagen can still benefit from future collaboration.
In principle, the capital market values homogeneous and more focused business units, and the value of large companies is often underestimated, because the individual value of their business units, or the value of sub-brands, has never been reflected 1:1 in the capital markets. The higher the company's rating, the greater the space for financing options and the scope of operations. Alliances with tech companies, for example, are helping to increase our speed and agility, and such alliances are becoming increasingly important.
The decision on the listing of Porsche AG will depend entirely on the Volkswagen Group. The Volkswagen Group announced that it will provide information on the progress of the relevant research by the end of the summer. Prior to this, Porsche was unable to provide any information on further developments.
QA interception:
1. Reporter: Is Taycan already profitable? Now that battery costs are rising, what is the profitability plan for the Taycan and Porsche new energy vehicle businesses?
Obermu: Taycan is currently profitable. We have planned this from the beginning, and despite the current increase in raw material prices, I would like to emphasize that every Porsche sports car we produce is profitable. Now our sales roI target is above 15% per year, so every one of our models has to be profitable. Relying on Porsche's electrification strategy, we are also convinced that we are able to sustainably achieve our strategic objectives in the coming years and maintain a high profit of more than 15%.
Maxig: Just now I mentioned that due to the cost of high-performance batteries, the profit margin of pure electric models and internal combustion engine models is not so high, so pure electric models are calculated at a lower margin than that of internal combustion engine models. Mr. Obermu also mentioned that in the era of internal combustion engine vehicles, our goal is to achieve a return on sales of at least 15% per year, and this strategic goal is no exception for Taycan, and it has been proven that we have also done it. In the future, we plan to achieve the same high profit margins as all electrified models as internal combustion engine models.
2. Reporter: The recent upward trend in the price of raw materials for electric vehicles is obvious, will the rise in raw materials for Porsche adversely affect the 15% return on sales target?
Obermu: We do face the disadvantages of rising raw material prices, so it is important to have a long-term raw material control and procurement strategy. When it comes to partners, we want to find the most suitable supplier. In the short term this year, we will see that the prices of some raw materials are higher than in the past, of course, we can only offset the rise in raw material prices with better cost control, in the long run, we must find more high-quality partners around the world, we can ensure the control of raw material prices.
3. Porsche has established a digital company in China, how do you evaluate Porsche China's achievements in digitalization in the past year? What role will China play in promoting or empowering Porsche's global digital transformation in the future?
Maxig: When it comes to the digitalization of Porsche China, it's a very important topic. We all know that the average age of Porsche owners in China is 15-20 years younger than that of car owners in the United States and Europe, and the proportion of female car owners is higher, most of them are young and promising entrepreneurs, so their demand for digitalization and intelligent interconnection of vehicles is the highest in the global market. That's why we decided to set up an independent digital company in China, and we also set up a new R&D branch in China as a strong complement to our existing digital business in China. We hope to be able to get closer to Chinese consumers and better understand their needs, especially in terms of digitalization and intelligent interconnection. We realized that we must cooperate with local Chinese technology companies to better provide Chinese consumers with convenient digital solutions and allow them to have more in-car entertainment experiences. Porsche has many traditional solutions that are not suitable for the special market of China, so we have been constantly exploring in this direction. The satisfaction of Chinese customers with our digital products and services is an important criterion for evaluating the success of our business, and if customers are satisfied with new digital products and services, this will also be reflected in our sales data. Of course, it is obviously a little late to rely on sales data, so we must listen to the voices of Chinese customers in advance.
4. We learned in the data sharing that China is the largest single market in the world for Porsche, so how much investment will land in the Chinese market in Porsche's future-oriented investment plan?
Obermus: As mentioned earlier, China has become The world's largest single market for Porsche for the seventh consecutive year with its solid growth and huge potential. That's why we decided to actively expand our R&D efforts in China, set up an R&D branch, and invest in the digital sector. Porsche expects to invest 15 billion euros globally by 2025 in new technologies and digitalization, some of which will go directly to China. As Mr. Maxig also said, hardware and digital R&D for Chinese consumers is very important to us because the needs of Chinese customers are unique to customers in other parts of the world. At the same time, we are encouraged by the spirit of innovation in the field of new technologies and digitalization in the Chinese market. Many of the emerging technologies started out in China and are gradually being applied to other markets around the world. As a result, China will become a very important innovation and experimentation base for us, which will also have a huge impact on Porsche's investment in innovation, technology and digitalization.
MAXG: In addition, Porsche China has made significant investments with local partners to expand high-performance charging networks. I think that's a very important part of our continuous electrification strategy in China. It's not just about the car itself, it's about the convenience that users can feel during the phase of using electrified products.
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