Controlling family shareholders of Porsche SE intensified calls for a substantive overhaul of Volkswagen's business approach after the holding group's first-quarter results showed weaker profits. Porsche SE, the vehicle through which the Porsche-Piech dynasty controls its investments, reported a 21% fall in adjusted profit after tax to 382 million euros for the January to March period. The holding company recorded an unadjusted after-tax loss of 923 million euros due to a 1.3 billion euro non-cash writedown on its stake in Volkswagen, following a 1.1 billion euro loss in the prior year.
The holding group is shifting some capital toward defence and artificial intelligence assets as its primary automotive investments struggle amid reduced profitability in a market contending with tariffs, rising competition from China and a difficult transition to electric vehicles. Porsche SE described such allocations as still representing only a small portion of its overall portfolio, but signalled they are part of a strategic response to the strain on traditional auto earnings.
In the first quarter, Porsche SE also reported proceeds of 60 million euros from the sale of its stake in semiconductor start-up Celestial AI. The board chairman, Hans Dieter Poetsch, said the quarterly results were broadly in line with expectations, while adding that long-standing business models that have underpinned its main investments will need to be realigned. His comments explicitly referenced Volkswagen and the Porsche AG sportscar business.
Porsche SE directly owns 31.9% of Volkswagen's shares and controls 53.3% of the voting rights. It also holds a 12.5% stake in Porsche AG. Poetsch has reiterated Porsche SE's commitment to Volkswagen in public remarks, but he has also pressed the company to identify further cost savings.
Volkswagen's chief executive, Oliver Blume, has promised to intensify cost-cutting measures beyond an existing programme that includes 50,000 job reductions. Under-used manufacturing plants in Germany have come under particular scrutiny as potential sources of efficiency gains, even though a 2024 agreement with unions guarantees no plant closures in Germany through the current decade.
The writedown recorded by Porsche SE was non-cash in nature and was the principal factor behind the large unadjusted loss for the quarter. Adjusted profit metrics, which exclude such writedowns, showed the continued decline but portrayed a less severe picture. Porsche SE emphasised that its moves into defence and artificial intelligence are intended to diversify sources of returns while its core automotive assets navigate a challenging operating environment.
Currency conversion noted by the reporting group places one US dollar at 0.8522 euros for contextual reference.
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