Porsche cutting more than a third of Chinese dealers as sales decline even faster

Porsche has announced that it will reduce its dealer network in China by about a third by the end of 2026. What the company calls “optimization” will consolidate the number of Porsche Centers in China to 100.

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The news comes following a sustained decline in Porsche sales in the market. In 2023, sales declined by 15%, with a total of 79,283 cars sold in China. This downtrend not only continued into 2024 but gained speed, with a 29% fall in sales in the first nine months of the year.

China was once Porsche’s golden goose, ranking as the largest market for eight consecutive years and accounting for more than 30% of the brand’s overall sales. Back in 2009, Porsche chose Shanghai to debut its new Panamera sedan, which was a break from the brand’s traditional sports cars and a deliberate attempt to gain traction in the Chinese market.

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Through the Panamera, and the Cayenne and Macan SUVs, the German brand built a strong base for itself in the Chinese market. Today, Porsche dealers are not immune to the price war in the Chinese market. Reports indicate that some Porsche models have had prices reduced by 30-35% at dealerships. The difficulty of shifting Porsche models from the showroom floor has led to dissatisfaction among dealers.

Currently, there are 138 official Porsche Centers in China. According to Alexander Pollich, president and CEO of Porsche China, These will be reduced to around 100 by the end of 2026.

Porsche’s so-called optimization involves investing in dealers in larger cities such as Shanghai and Beijing. This will see the continued rolling out of the Destination Porsche concept, which is currently across 35% of the network, up from 20% in 2022. This reimagines the traditional dealership as a luxurious, experiential hub.

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The brand is expanding its online sales network and presence. A new “Track Your Dream” feature, available on the Porsche app and WeChat Mini program, allows purchasers to track information about their car’s production and delivery in real-time.

Part of Porsche’s woes in China have been due to the challenges faced by EV brands. Porsche aims to increase its share of electric vehicles to 80% by 2030.

The decline in Porsche’s fortunes is symptomatic of the changes taking place in the Chinese market. There has been a general shift towards new energy vehicles, BEVs and PHEVs, and a shift from foreign producers to Chinese producers. In the first ten months of 2024, sales of imported vehicles saw a year-on-year decrease of 14.3%.

Dealerships are also feeling the pinch. In the first half of 2024, nearly 2,000 dealers closed, almost the same number as in the whole of 2023. Over the past four years, 8,000 dealerships have closed.

资料来源 IT Home, Sohu, China Daily