The CEO indicated doubt regarding Porsche’s continued EV sales in China over the next 2-3 years
The dependence of Western luxury car manufacturers on the Chinese market has been significant for years, but this prosperous era may be ending. The rise of domestic Chinese automakers is considerably reducing demand for international brands, as Porsche is experiencing. Their sales in China dropped by 28 percent in 2024 to 79,283 vehicles, and the first quarter of this year saw an even sharper decline of 42 percent, with only 9,471 units sold.
This downturn for Porsche isn’t attributed to a decrease in the desirability of models like the 911. Instead, the primary challenge is competing with Chinese electric vehicle manufacturers. Companies like Xiaomi are offering significantly more affordable EVs, some with performance specifications exceeding those of Porsche’s Taycan or Macan. Porsche is aware of this issue, and rather than lowering prices or introducing more budget-friendly electric models, the company might consider withdrawing from the Chinese EV market altogether.
Speaking at Auto Shanghai 2025, Porsche CEO Oliver Blume indicated this potential shift, stating that the next two to three years will determine Porsche’s future as an electric brand in China. Blume, who also heads the Volkswagen Group, acknowledged that Porsche’s electric vehicle sales in China are “relatively low,” according to Automotive News.
Porsche’s leadership has made it clear that they will not prioritize sales volume and intend to maintain pricing that aligns with the brand’s premium image. Consequently, upcoming electric models like the new Cayenne EV and the electric successor to the 718 will not be positioned as budget-friendly options.
Blume does not consider Xiaomi’s high-performance SU7 Ultra as a direct competitor, arguing that it is a less expensive EV that cannot match Porsche’s “driving ability.” In China, the Xiaomi SU7 Ultra is priced starting at 529,900 yuan (nearly $73,000), while the base 402-horsepower Porsche Taycan begins at a much higher 918,000 yuan ($126,000).
Unlike brands such as BMW, Mercedes, Audi, and even Jaguar, Porsche has not invested in developing models specifically for the Chinese market. These global competitors have invested heavily in long-wheelbase sedans and SUVs to provide more rear passenger legroom. Audi has even launched a dedicated electric sub-brand in China.
Notably, Volkswagen’s Jetta is also marketed as a separate brand in the country.
While Volkswagen plans to introduce 20 plug-in hybrid and electric vehicles in China by the end of 2027, Porsche seemingly has no similar plans for localized products. A new gasoline-powered crossover to replace the Macan would be a logical step, but it is not expected until later in the decade.
Other traditional luxury automakers have adapted their strategies to maintain their market share, with examples including premium minivans like the Lexus LM, Buick GL8, and Volvo EM90.
However, the increasing difficulty for international players to compete in China is driven by Chinese brands’ easier access to raw materials and lower labor costs. Outcompeting them in their own market now appears to be an insurmountable challenge. Some automakers are acknowledging this new reality and are instead choosing to strengthen their local partnerships, adopting the strategy of “if you can’t beat ‘em, join ‘em.”
