To say Porsche is struggling in China would be an understatement. Sales fell 28 percent to 56,887 cars in 2024. Through September this year, the decline continued, with shipments dropping another 26 percent. Looking ahead, Zuffenhausen has a plan called “Winning Back China,” although it concedes that returning to previous sales volumes is unrealistic. In an interview with German business newspaper Automobilwoche, Porsche China CEO Alexander Pollich candidly admitted the competition is fierce and that “the pace of innovation in China is breathtaking.” He recalls the Taycan being successful at launch, but now “there is a veritable flood of electric sedans in completely different price segments.” 'The pace of innovation in China is breathtaking, as is the variety of products on offer, and price and marketing strategies seem to change on a daily basis. Suddenly, you are faced with a multitude of market participants. And the cars appeal to customers' tastes, let's be honest. But we are rising to this challenge.' Sales have suffered not only from an influx of lower-priced EVs but also from a lower luxury tax threshold. Since 2016, it stood at 1.3 million yuan ($184,000), but from July 20 this year, it was reduced to 900,000 yuan ($127,000). That change impacted business, making the cars even more expensive and out of reach. The average net list price for a new Porsche in China is under 1 million yuan ($141,000). 2026 Porsche Cayenne Electric Consequently, Porsche is scaling back. From 150 sales outlets in 2024, it’s now down to 120. By the end of next year, it’ll have only 80 brick-and-mortar dealerships. The remaining stores are eagerly awaiting the newly announced combustion-engine SUVs. The luxury automaker has confirmed plans to replace the original Macan with a new gas-fueled model. In addition, the three-row vehicle, which was supposed to be exclusively electric, will launch first with combustion engines. EVs will still play a role under the “Winning Back China” strategy. The Cayenne Electric will be launched locally. The 718 EV is also coming and is claimed to be “unique in China in terms of its sportiness.” Pollich didn’t elaborate on what that means, but it’s worth noting that the next Boxster and Cayman will still offer gas engines, albeit only for the range-topping versions. Porsche’s head honcho in China warns of a “challenging” 2026, which isn’t surprising. The new gas-fueled SUVs mentioned earlier won’t arrive until later this decade. Meanwhile, rejuvenating sales through a spin-off brand, such as Audi’s confusingly named, ringless AUDI, is not in the cards. Pollich didn’t entirely rule it out but clarified there are currently no plans for a second Porsche brand. 2026 Porsche Cayenne Electric Citing high costs, the company’s local boss also ruled out shipping semi-knocked-down (SKD) or completely-knocked-down (CKD) kits to China for local assembly. Porsche isn’t an exception, as its main rivals are also struggling in the world’s largest car market. The BMW Group (including MINI) fell 13 percent last year, Mercedes dropped seven percent, and Audi was down 10.9 percent. It’s the new harsh reality of an intensely competitive market shaped by the rise of local automakers. China has caught up with legacy players, and their pricing is unbeatable, especially in the EV segment. In Porsche's case, leaning heavily on electric vehicles certainly didn’t help, but renewed interest in combustion engines could work in its favor. We want your opinion! What would you like to see on Motor1.com? Take our 3 minute survey. - The Motor1.com Team
