Porsche, alive and burning fuel, denies breakdown SOS | autos | Hindustan Times
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Porsche, alive and burning fuel, denies breakdown SOS

German automobile giant Porsche may be facing one of its worst years in recent times, but the carmaker has scoffed at rumours of an impending need for an overall restructuring of the company.

autos Updated: Jun 25, 2009 22:41 IST
Sumant Banerji

German automobile giant Porsche may be facing one of its worst years in recent times, but the carmaker has scoffed at rumours of an impending need for an overall restructuring of the company.

Porsche, renowned as one of the most profitable carmakers in the world, has been badly hit by the recession in developed markets, with its sales between August, 2008 and April, 2009 falling by 27.6 per cent to just 53,635 units. The company's nine month profit is down 15 per cent to $ 6.4 billion.

Further the company's unflattering debt position of $ 12.7 billion, which it highlighted during its recent bid to merge with the larger Volkswagen group, has put it in a precarious position.

"This talk of a restructuring of the company is complete nonsense," said Michael Macht, member of executive board of directors, Porsche AG. "We are still in black in an environment when most of the others are going under and are still reporting an operating return on turnover in double digits. Porsche will not need to be restructured completely."

Short on cash, the luxury carmaker is in talks with the government for a $ 2.5 billion loan, as also with Qatar Investment Authority for a stake sale.

"It is not for me to tell you where we stand on these issues at this point of time but yes, we are definitely in contact with Qatar and you will hear from us on that in two weeks," Macht said. "I am pretty certain that in cooperation with Volkswagen, we will maintain our independence."

The company, which follows an August-July fiscal year, will launch its first four-door sportscar, Panamera in September this year and is hoping the car will do the trick in terms of sales.

"We hope to sell 20,000 Panameras in a year and in the segment which is 1 million strong worldwide we dont think that is too much," Macht added. "We are feeling the cold wind of the market but this car will boost our growth in the medium-term."

The Panamera will be available in India in late September-early October at a price ranging between Rs 1.42 crore and Rs 2.02 crore. The company said it has already received bookings for 45-50 Panameras in India.

The writer was in Germany at the invitation of Porsche