A flood at a subcontractor… and that’s a billion euros of potential revenue that evaporates for Porsche. The luxury car manufacturer announced on July 23 that a flood at a European subcontractor’s site is affecting its aluminum supply. This could cause production stoppages for one or more vehicle series. Following the incident, Porsche now expects sales of between 39 billion and 40 billion euros, compared to 40-42 billion euros previously. The group has, however, confirmed its profit forecast for 2024.
The shortage has also affected the supply chains of BMW and Mercedes-Benz, but both have been able to find alternative suppliers. Spokespeople for BMW and Mercedes-Benz declined to provide further details. “This raises some questions about supply chain management at Porsche,” said Patrick Hummel, an analyst at UBS Bank, “who was surprised to see that Porsche is frequently hit by supply chain issues, while supply chains have remained very stable for most automakers since the end of the semiconductor crisis.”
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On the Frankfurt Stock Exchange, at around 2:35 p.m. GMT, Porsche shares fell by 3.3% to 41.29 euros, among the worst performances of the Dax, which gained 0.76% at the same time.
“A Biblical Flood”
“It’s a biblical flood that wiped out the gains from the IPO,” Bernstein Research analyst Stephen Reitman said wryly, referring to Porsche’s historic September 2022 IPO.
According to Bernstein analysts, the flooding occurred at a Swiss supplier and would result in the loss of production of at least 10,000 to 17,400 vehicles in the second half of 2024. At the high end of the range, this figure equates to more than 11% of Porsche’s deliveries in the first half.
Porsche said it was expected that delays in vehicle production and delivery would not be fully offset for the rest of the year. The group now expects sales profitability of between 14% and 15% for the year, compared with 15-17% previously.
With Reuters (Victoria Waldersee, Utkarsh Shetti, Kanjyik Ghosh, Andrey Sychev, Christoph Steitz, Nick Carey and Alexander Huebner; French version Elena Smirnova; editing by Augustin Turpin)
Source: www.usinenouvelle.com
