On December 4, Porsche's official website announced a personnel appointment - Li Nan became the Vice President of Porsche China's Technology Department.

The Technology Department is a new division within Porsche China. According to Alexander Pollich, President and CEO of Porsche China, Li Nan will lead this department to accelerate Porsche's product upgrades in vehicle connectivity, intelligent driving, and other areas, making Porsche more 'in China, for China' through local procurement and other means.

What local 'specialties' in China are worth Porsche's procurement? Audi, which also belongs to the Volkswagen Group, showcased two new models equipped with Huawei's intelligent driving technology at the Guangzhou Auto Show. Among them, the Q6L e-tron is a model based on the same platform as the Porsche electric Macan.

Whether Porsche will 'copy' Audi's homework requires a long-term perspective to determine, but it is an open secret that the good days of this once sought-after German ultra-luxury brand in China are coming to an end.

According to our understanding, although rumors claim that a Porsche Macan can be purchased for less than 400,000 yuan, this is merely a gimmick, as sufficient options and loans are required to take delivery of the vehicle. However, popular models such as the Cayenne and Panamera have indeed offered 'historic' cash discounts, and discounts on pure electric models like the Taycan can even reach six figures.

Price reductions for new vehicles are not terrifying; after all, almost no brands in the Chinese auto market have avoided price reductions this year. However, what truly concerns Porsche is when price reductions fail to translate into increased sales.

According to official Porsche data, from January to September 2024, Porsche China (including Hong Kong) delivered 43,280 vehicles, a year-on-year decrease of 29%. According to a list compiled by Yiche based on terminal sales data, in the first three quarters of 2024, sales in the top 20 cities where Porsche sold the most vehicles all declined to varying degrees, with the smallest decrease at 9.6% and the largest at 39.3%.

Facing this mess, Alexander Pollich, who took over as President and CEO of Porsche China on September 1, must be quite headached.

01

Being 'Stolen' by Mi Porsche

Just as Apple did not consider Xiaomi a competitor in its early years, Porsche likely did not take Xiaomi SU7 seriously at the beginning of this year. However, by the end of the year, Porsche had already started to shout across the air to Xiaomi.

'Anyone can claim to surpass Porsche in advertisements, but it's a different story on the track.'

This was a slogan displayed by Porsche at the Shanghai International Circuit in November. Although not named directly, onlookers immediately associated it with Xiaomi, which officially announced at the end of October that it had surpassed Porsche to become the 'fastest four-door electric vehicle at the Nürburgring'.

Since its brand launch, Xiaomi has not been shy about 'attaching' itself to Porsche. Its first model, the Xiaomi SU7, was even nicknamed 'Mi Porsche' due to its resemblance to the Porsche Taycan. Xiaomi has not rejected this nickname.

Left: Porsche Taycan | Right: Xiaomi SU7

Don't underestimate the impact of Xiaomi, whose price range is mainly between 200,000 and 300,000 yuan, in stealing customers from Porsche. Thanks to its growing popularity, the Xiaomi SU7 has replaced Porsche as a tool for attracting attention and endorsing performance in industries such as WeChat business and medical cosmetology.

Don't underestimate the size of this group. According to an interview with Porsche insiders conducted by well-known industry consulting firm JLR, about 60%-70% of Porsche customers are high-net-worth individuals who truly consider Porsche a consumer good, while the remaining 30%-40% mainly view Porsche as a ticket to the upper class.

Meanwhile, in the million-yuan performance car market, Xiaomi has even become a direct competitor to Porsche. The Xiaomi SU7 Ultra, with a pre-sale price of 814,900 yuan, received 3,680 orders within 10 minutes of its pre-order opening. Users willing to spend nearly a million yuan on a Xiaomi vehicle are naturally target customers for Porsche's 718 and 911 sports car lines.

For reference, according to Yiche data, sales of the Porsche 718 were 2,934 units and the 911 was 1,949 units in the first three quarters of 2024.

Looking ahead to 2025, another wave of new Xiaomi vehicle launches is imminent. Will the new SUV, which has been jokingly referred to as 'Ferrari Mi', affect Ferrari? Probably not, but it's harder to say for Porsche's Macan and Cayenne.

02

Rescuing Electrification with 'Chinese Specialties'

In the current downturn cycle of Porsche, the ineffective transition to electrification is the most significant factor.

From January to September 2024, the model that 'dragged down' Porsche sales globally was the Taycan, the brand's flagship electric vehicle. Compared to the same period in 2023, Taycan sales nearly halved, directly offsetting the approximately 13,000 sales increase brought by the Cayenne.

What's even more amusing is that sales of the Porsche 718 increased slightly from January to September this year.

According to industry insiders, this is due to the upcoming all-new generation of the Porsche 718, which will transition from a gasoline-powered sports car to an electric one. Many buyers have placed orders before the switch to the new model. Meanwhile, foreign media recently reported that the all-electric Porsche 718 has been put on hold. If this 'planning-oriented' German automaker is willing to scrap a new vehicle that has already entered the final road test phase and rebuild it, the low market acceptance of the new vehicle may be Beyond imagination .

In terms of pure electric vehicles, Porsche's approach is to 'put old wine in new bottles.' With a classic appearance inherited from gasoline vehicles and a classic driving experience that strives to match gasoline vehicles, to some extent, the electric vehicles Porsche pursues are essentially gasoline-powered Porsche models that don't burn fuel.

This clearly does not meet market demand, at least not in the Chinese market.

In the Chinese market, BMW's pure electric vehicles come with an unprecedented large rear screen, Audi's pure electric vehicles use Huawei's intelligent driving technology, and Mercedes-Benz also plans to use solutions from Chinese autonomous driving startup Momenta in multiple new models. Porsche's transition to electrification may also require the injection of new vitality from 'Chinese specialties.'

Establishing a dedicated team for local procurement is a good start, but Porsche needs to act faster.

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