As demand saw a draw, Porsche revealed plans to tighten its dealership network in China. It comes amid similar concerns across other German auto manufacturers that are struggling in the region.
German luxury automaker Porsche AG said China's world's biggest car market is still fighting a narrowing point in 2024 as its sales declined significantly. Sales in China fell 28 percent and the company, which is majority owned by Volkswagen, said it sold 56,887 vehicles, down from 79,283 in 2023.
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Porsche's biggest market, China, represent in the steep decline skates, and weighed on the brand's global performance. Other regions posted growth but worldwide sales for the year were down 3% to 310,718 units. Sales in Porsche's domestic market of Germany rose by 11 percent, a sign of strong local demand.
The slowdown in China is tied to waning consumer confidence fanned by Chinese economic growth slowing down as it continues its real estate crisis, according to industry experts. This has resulted in consumers trimming back the luxury spending and putting up challenges for premium car brands.
Porsche’s board member Detlev von Platen commented on such, saying: “For 2024 as a whole, we demonstrated ourselves to be very robust in a challenging market environment.”
As demand saw a draw, Porsche revealed plans to tighten its dealership network in China. It comes amid similar concerns across other German auto manufacturers that are struggling in the region.
Such is part of a broader industry trend for which the drop in China sales is typical of that of higher end carmakers. Mercedes-Benz this month reported a 7% decrease in sales in 2024 China, where it also has posted lower performance overall. The Volkswagen brand also suffered an 8.3% fall in its China deliveries to 2.2 million vehicles sold in the market.
Regardless, Porsche's performance in more favorable markets, like Germany, make its challenges in China seem nothing compared to nothing. But the contraction in China sales is proof of how volatile one of the most important regions for luxury automakers worldwide can be.