Key Highlights

• Porsche SE, the majority shareholder of Volkswagen, anticipates a staggering €20 billion ($21.7B) loss in 2024.
• This anticipated loss arises from impairments concerning its stakes in Volkswagen (31.9%) and Porsche AG (12.5%).
• Declining market values of both entities and ongoing union disputes at Volkswagen have contributed to financial instability.

Market Implications

• Porsche SE’s impairments include:
• €19.9B from Volkswagen
• €3.4B from Porsche AG
• Notably, these impairments are non-cash effective, thus not impacting liquidity, but they will significantly affect financial reporting.

What’s Next?

• Porsche SE is set to release full-year results on March 26.
• Investor sentiment is closely tied to Volkswagen’s recovery, with ongoing concerns regarding plant closures and wage disputes.

Final Thoughts

Porsche SE’s massive projected loss underscores the struggles facing Volkswagen, placing additional market pressure leading up to their earnings release.