Porsche sinks 25% in North America after war, supply chain, ship disaster

By BLOOMBERG | 5 April 2022

NEW YORK: Even the most buoyant of automakers is facing squalls after a perfect storm of supply-chain shortages, war, and the sinking of a cargo ship carrying millions of dollars worth of product across the Atlantic.

Porsche Cars North America Inc. announced on April 1 that U.S. retail deliveries in first quarter 2022 sunk 24.9% compared to the same quarter in 2021.

The company delivered 13,042 units during the first three months of this year, down from 17,368 delivered during that period last year.

Company executives blamed supply and transit issues for impacting customer deliveries in what has historically been the brand’s biggest and most important single sales market.

Russia’s war on Ukraine, where Porsche sources components, has also hampered the company’s ability to produce cars, Porsche AG chief executive officer Oliver Blume told reporters in a conference call on March 17.

"We do have different suppliers in Ukraine; we do have delivery delays,” he said.

"It’s up to us to manage the challenges. The whole model range is affected. That is clear.”

Those troubles compounded when the Felicity Ace sank near Portugal’s Azores in March.

The vessel held at least US$400 million worth of vehicles from Bentley, Lamborghini, and Porsche, among others.

At the time, Porsche executives said they would work to replace all of the customer vehicles destroyed, although it would take time to build new ones.

One customer expected to wait as many as eight months for his special-order Porsche Boxster Spyder to be replaced.

The fire was estimated to pose a total of US$155 million in losses for the brands affected.

On the March 17 call with reporters, Porsche AG chief financial officer Lutz Meschke admitted that all vehicles produced by Porsche would face significant delays because of the multiple challenges the brand faces.

"All model lines will be affected in the next coming months,” he said.

All Porsche model deliveries were down in this year’s first quarter, save for the Panamera sedan, which saw deliveries jump from 451 in 2021 to 787 in 2022.

The Macan was the company’s bestseller, even though its deliveries plummeted from 6,391 to 4,772 compared with those in 2021. Deliveries of popular darling  911 cars fell from 2,782 in 2021 to 2,123 in 2022.

Meanwhile, a dearth of new cars has led to used Porsches selling for tens of thousands of dollars above market values, with some specimens setting records.

The earnings news came the day after Volkswagen AG snubbed Germany’s Deutsche Bank in favour of American banks Goldman Sachs Group Inc., Bank of America Corp., JPMorgan Chase & Co., and Citigroup Inc. to play the lead role in Porsche’s impending initial public offering.

The listing could value Porsche as high as US$100 billion, making it one of Europe’s biggest-ever offers, Bloomberg reported on March 31.