Porsche Sees More Money In Making EVs

Auto CEOs warned for years about effects a costly transition to electric vehicles would have on their margins. But ahead of its landmark potential listing, Porsche is telling investors it can become more profitable focusing on battery power.

The Volkswagen-owned sports-car maker sees more potential to raise prices of its EVs than its combustion engine models, Chief Financial Officer Lutz Meschke said during Porsche’s capital markets day early this week. He sees the manufacturer’s EV margins reaching parity with those of combustion vehicles in two years, then expanding because customers are willing to pay more for new technology.

The sports-car maker — which plans an initial public offering in the fourth quarter — mapped out a push to grow return on sales to more than 20% in the long term, up from 16% last year. Management expects eight in ten Porsches sold by the end of this decade to run on electricity, and for EVs to account for half the luxury automotive market in 2031.