Porsche considers moving Cayenne production to Germany to boost margins
Porsche is evaluating a return of Cayenne production to Leipzig to reinforce its German brand identity and improve margins. The move follows a 16% drop in deliveries and a strategy to make the company smaller and more expensive.
Porsche is considering moving Cayenne production from Bratislava back to Leipzig, potentially making all its models 'Made in Germany.' CEO Michael Leiters is pursuing a strategy of making Porsche 'smaller and more expensive' to strengthen its German brand identity. The decision is driven partly by Audi’s potential construction of a US plant, which would remove shared technology advantages in Slovakia. Porsche is not planning to build in the US due to low volume and customization complexity, and has factored in 15% US tariffs. In the first nine months, Porsche delivered 178,532 cars, a 16% decrease, but revenue fell only 5.9% to 25.3 billion euros, increasing average revenue per vehicle to 126,000 euros. Operating profit rose to 1.74 billion euros from 40 million, though this compares to 2.7 billion in the prior year due to one-off costs. Cash flow of 2.5 billion euros included nearly 1 billion from the sale of Bugatti and Remarque stakes, leaving net liquidity at 8.2 billion euros. Leiters targets a long-term margin of at least 15% and profitability with under 200,000 annual units. Deutsche Bank set a price target of 55 euros, 25% above the current price, viewing 2027 as a transition year. Deutsche Bank analysts viewed the recent results as a positive surprise, particularly the cash flow, and suggested the stock is a buy for investors willing to wait for the 2027 outlook.