Abstract: The Chinese market has become the biggest contributor, electric vehicles have performed well, and Porsche is in "excellent condition"
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Wen | Wang Jingyi
Editor| Zhao Cheng
In 2021, the German luxury car brand Porsche delivered 301915 new cars worldwide – marking the first time that Porsche's new car deliveries exceeded the 300,000 unit mark, a record high.
By model, the best-selling ones are the entry-level Macan (88,362 units) and the medium- and large-sized SUV Cayenne (83,071 units). By region, China has become the largest single market for seven consecutive years, with nearly 96,000 units delivered in the Chinese market in 2021, up 8% year-on-year.
At the same time, Porsche's operating income and sales profit hit record highs in 2021. Operating income climbed to EUR 33.1 billion in 2021, an increase of EUR 4.4 billion from the previous fiscal year, an increase of 15% year-on-year, and profit from sales of EUR 5.3 billion, an increase of 27% over the previous fiscal year. As a result, Porsche achieved a return on sales of 16.0% in FY2021.
"Strategically, operationally and financially, Porsche is in a fantastic position." Lutz Meschke, vice chairman and member of Porsche's Global Executive Board and head of finance and information technology, said at the annual press conference on March 18.
Porsche, part of the Volkswagen Group (VOW3.DE), is considering an independent listing. Maxig bluntly said that large companies in the capital markets tend to be undervalued, while homogeneous and more focused business units are more valued.
The industry expects that porsche, one of the world's most profitable car manufacturers, will be valued at around 90 billion euros, and if successfully listed, it may become the largest IPO in the history of Germany and the automotive industry.
The Chinese market has become the biggest contributor, and electric vehicles have performed well
Porsche's average selling price is about one million yuan, and the positioning of luxury brands limits its sales scale, but in 2021, its sales exceeded the 300,000 unit mark for the first time.
Among them, China, as the largest single market, has contributed to sales. In 2021, the delivery volume in the Chinese market will be nearly 96,000 units, an increase of 8% year-on-year.
"Our customers in China are very young, a whole generation younger than our European customers. For example, Porsche's customers in Germany are mainly men around 55 years old. But in China the average age of our customers is 35 years old. Dr. Boyu Yan, President and CEO of Porsche China -Ing. Jens Puttfarcken) painted a user portrait of Caijingqiche in this way.
Yan Boyu added that the proportion of female customers in China is higher, the gender ratio has reached 1:1, and most of the female customers are concentrated around the age of 32-35, most of whom are young and promising entrepreneurs.
In terms of models, Porsche's best-selling models are the Macan, Cayenne, Taycan, 911, Panamera and 718. Among them, the Macan and Cayenne are both SUV models, which have more space than sports cars and carry the sales flag for Porsche.
It is worth noting that the Taycan, a Porsche pure electric model that has only been on the market for one year, will sell more than 40,000 units in 2021, surpassing the classic sports car 911 in one fell swoop – an electric sports car with an average price of nearly 1 million yuan, with a range of more than 400 kilometers, emphasizing the driving experience.
"The sale of the Taycan can be said to be very successful." Yan Boyu told Caijingqiche that 72% of Taycan users are the first to buy a Porsche model, and generally have a high income and education background, and the average age is less than 35 years old.
In general, electric vehicles are less profitable than fuel vehicles because they cost more and are smaller, but Porsche's electric car, the Taycan, is now profitable.
Porsche plans to account for about half of global new car sales by 2025, including plug-in hybrid or all-electric models, and by 2030, the proportion of pure electric vehicles in new car sales will exceed 80%.
In order to achieve this goal, in 2023, Porsche will launch a second pure tram, that is, a pure electric version of the Macan. Electrifying the most popular model, Porsche hopes to replicate the success of the fuel car Macan. Thereafter, the classic sports car 718 will also be fully electrified, planned to be born before 2025.
"Every Porsche sports car we produce is profitable." Maxig stressed that due to the cost of high-performance batteries, the profit margin of pure electric models and fuel models is not so high. But Porsche aims to achieve a return on sales of at least 15% per year, so future electrified models will achieve the same high profit margins as internal combustion engine models.
Profitability is strong, and an IPO is imminent
Porsche's bicycles are priced at a high price and profitability. Profit from sales of €5.3 billion in 2021, up 27 percent from the previous fiscal year.
In 2021, Porsche's return on sales is 16%, ranking first within the parent company Volkswagen Group and one of the most profitable car manufacturers in the world.
Porsche has always played the role of a profit cow in the Volkswagen Group. According to the financial report, the Volkswagen Group sold a total of 8.6 million cars in 2021, with Porsche accounting for only 3% of sales, but the profit accounted for a quarter of the group's (about 20 billion euros).
Super profitability has brought ample cash flow to Porsche, and its net cash flow in 2021 increased by 67% year-on-year to 3.7 billion euros.
"We will face serious political and economic challenges in the coming months, but we will remain committed to our long-standing strategic goal of achieving a return on sales of at least 15% per annum over the long term." Maxig stressed.
Currently, the parent company Volkswagen Group is preparing for an IPO for Porsche.
Arno Antlitz, finance officer of Volkswagen Group, recently said that Porsche is likely to conduct an IPO as soon as the fourth quarter of 2022 and will update the market on the progress and timeline of the listing in the late summer. At its annual press conference on March 18, Porsche welcomed the IPO.
Hong Sheng, vice president and chief financial officer of Porsche China, told Caijingqiche (ID: caijingqiche) that many new car-making forces may have been listed in consideration of the lack of funds, while Porsche has maintained high profitability, and the return on sales has stabilized at more than 15%.
Porsche is a premium asset of the Volkswagen Group. Volkswagen Group's 2021 financial report shows that the profit margin of the Volkswagen brand is 3.3%, and the Skoda brand has reached 6.1%; the capacity utilization rate of the Audi brand, although relatively low, has also reached a profit margin of 10.5%; Bentley has achieved a high profit margin of 13.7%; Porsche has the highest, with a profit margin of 16.5%.
In fact, porsche IPOs were not entirely about fundraising. Maxig said that an independent listing can increase Porsche brand awareness and increase corporate freedom.
"Large companies in the capital markets tend to be undervalued, and in principle, homogeneous and more focused business units are valued 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. Maxig said bluntly.
As one of the most profitable car manufacturers, Porsche will be valued at around 90 billion euros, and if the IPO is successful, it could become the largest public offering in the history of Germany and the automotive industry.