Porsche defies car industry gloom with record sales

Porsche AG shrugged off widespread industry malaise, reporting record deliveries for last year and predicting that its first all-electric model, the Taycan, will generate further growth in 2020.

Global deliveries rose 10% to 280,800 cars in 2019, driven mainly by strong consumer appetite for the Macan and Cayenne sport-utility vehicles, Porsche said Monday in a statement.

“We’re optimistic that we can sustain the high demand in 2020," sales chief Detlev von Platen said in the statement. Sales momentum should benefit from “the introduction of some new models and full order books for the Taycan," he said.

The most profitable division of Volkswagen AG, the world’s largest automaker, is entering a new era with this year’s rollout of the Taycan four-door sedan, which challenges Tesla Inc.’s Model S electric car. Porsche’s cachet has been shaped for decades by fast sports cars with roaring combustion engines, and success of the costly expansion into electric vehicles is mission-critical for the German manufacturer amid stricter emission regulations in key markets.

Sales rose 8% last year in both China and the U.S., Porsche’s two largest markets. It sold 86,752 cars in China, where luxury rides have been less affected by the waning demand hurting the overall market, and 61,568 cars in the U.S. In Germany, sales advanced 15% to 31,618 vehicles.

Porsche’s deliveries picked up toward the end of 2019 after sales in the first half of the year were held back by more complex emission tests in Europe and the decision to phase out diesel-engine offerings. Following the roll out of the Taycan, Porsche plans to add a more spacious version of the vehicle dubbed Cross Turismo at the end of 2020.

Porsche embarked on a far-reaching overhaul to mitigate surging development costs for electric cars and new software features, which is aimed at lifting earnings by about 6 billion euros ($6.7 billion). The steps are needed to keep Porsche’s operating margin above a long-standing target of 15% return on sales as electric cars are still less profitable than combustion-engine vehicles like the 911 sportscar.