Porsche SE Warns of €20 Billion Volkswagen Impairment

Porsche SE, the largest shareholder in Volkswagen, has announced it may write down the value of its stake by up to €20 billion ($21 billion) due to high operational costs, intense competition, and ongoing conflicts with unions. This potential impairment, which could range from €7 billion to €20 billion, reflects concerns over Volkswagen's financial stability amid a challenging market environment. Porsche SE also anticipates a €1 to €2 billion write-down on its 12.5% stake in Porsche AG, citing lower demand and geopolitical tensions. As Volkswagen struggles with negotiations over cost-cutting measures, its dividend is projected to decrease from €9 to €6.75, impacting Porsche SE's revenue outlook. The holding company has withdrawn its previous profit forecast for 2024, expecting a significantly negative result instead. Overall, these developments underscore the precarious position of both Porsche SE and Volkswagen in the current automotive landscape.