The powerful families behind Volkswagen are pressing the German automaker to make major changes to how it operates after their investment firm took a significant financial hit during the first quarter.
Porsche SE, the investment company controlled by the Porsche-Piech families and Volkswagen’s biggest shareholder, reported that its adjusted profits dropped 21% to 382 million euros ($469 million) between January and March.
The investment firm’s overall financial picture looked even worse, with an unadjusted loss of 923 million euros after taking a massive 1.3 billion euro writedown on the value of its Volkswagen holdings. This follows a similar 1.1 billion euro loss the company recorded last year.
As traditional car business profits continue declining, Porsche SE is exploring new investment opportunities in defense technology and artificial intelligence sectors. The global automotive industry faces mounting pressure from trade tariffs, increased competition from Chinese manufacturers, and difficulties transitioning to electric vehicle production.
These alternative investments remain a minor portion of Porsche SE’s overall portfolio. The company did generate 60 million euros during the quarter by selling its ownership stake in semiconductor startup Celestial AI.
Hans Dieter Poetsch, who chairs Porsche SE’s board, acknowledged that the quarterly results matched what analysts expected.
“At the same time, the business models that have served our core investments well for a long time now need to be realigned,” Poetsch stated, referring specifically to Volkswagen and its Porsche AG division.
The holding company maintains significant control over Volkswagen, owning nearly 32% of all shares and commanding 53.3% of voting power. It also holds a 12.5% stake in luxury sports car manufacturer Porsche AG.
Poetsch has consistently expressed Porsche SE’s long-term support for Volkswagen while simultaneously urging the automaker to identify areas where it can reduce expenses.
Volkswagen’s chief executive Oliver Blume has promised to accelerate cost-reduction efforts beyond the 50,000 job eliminations already underway. Several underutilized manufacturing facilities in Germany are being examined for potential changes, despite a 2024 labor agreement that prevents any plant closures through the end of this decade.
