Porsche Under Pressure From Dealers in China: Caught in a Price War and Decreasing Consumer Spending Power

Recently, the conflict between Porsche's dealers in China and the Porsche brand caused by unsatisfactory car sales has caused a heated discussion. On May 27, Porsche issued a joint statement with all authorized dealers. The statement said that the automobile industry is undergoing unprecedented major changes. Porsche and its dealers will face a number of complex problems, with opportunities and challenges coexisting. This statement is aimed at appeasing the emotions of the dealers, showing that the Porsche brand will share difficulties with the dealers. But at the same time, it also proves that Porsche's poor sales in the Chinese market have been officially confirmed.

Porsche stated in the declaration that it will always maintain a long-term and mutual trust dialogue mechanism with all authorized dealers. The company will face the dilemma in China together with its dealers, but it has not announced specific implementation measures, only mentioned areas including business policy, local customer insight, customer service, and electrification transformation.

Porsche entered the Chinese market in 2001. Its cars have always been positioned as high-end sports cars. However, in recent years, due to the decline in economic conditions and the impact of China's own brand of electrified cars, Porsche's sales and pricing have been greatly affected. The decline in economic conditions has caused the consumption power of the Chinese people to shrink, and they have become more cautious towards high-end consumption. And the pricing system of high-end fuel vehicles has become uncontrollable due to the price war from China's electrification vehicles. According to Porsche's financial report, the sales volume of Q1 in the Chinese market was 21,365 units in 2023, while the sales volume of that in 2024 was 16,430 units, a year-on-year decrease of 25%.