Porsche’s Race With Ferrari Is Really No Contest
Porsche’s valuation gap to Ferrari has become a chasm as the German automaker struggles with cooling demand in China.
An employee selects a badge for an all-electric Porsche Taycan luxury automobile on the production line at the Porsche AG factory in Stuttgart.
Photographer: Krisztian Bocsi/Bloomberg
When Porsche AG sold shares last year, the German sportscar maker hoped to follow in the gilded footsteps of Ferrari NV and achieve a valuation more in line with a luxury-goods company rather than a metal-bashing automaker. Those dreams have begun to fray amid signs that Porsche is susceptible to an economic slowdown after all: The stock has declined around one-third since peaking in May, and now lies below the €82.50 ($90.75) offer price. An already sizable valuation gap to Ferrari has become a chasm.
Ferrari caters to the super-rich — as opposed to the merely affluent like Porsche — and is seen by investors as a safer port in an economic storm. To recover, Porsche must prioritize exclusivity and high sticker prices. Doing so may require it to forgo potential sales.