Removed from DAX, Added to MDAX
Porsche's Stock Price Drops by Two-Thirds This Year
Luxury sports car manufacturer Porsche is set to be excluded from the DAX, Germany's flagship stock index, in the near future. This move is seen as a response to the company's recent slowdown in performance and declining stock price.
On September 3 (local time), Yonhap News Agency reported that Deutsche Boerse Group, which operates the Frankfurt Stock Exchange, announced that Porsche will be removed from the DAX index starting on the 22nd and will be included in the MDAX index for mid-cap stocks. The DAX, which represents Germany's blue-chip stocks, is a major index composed of the top 40 companies by market capitalization. In contrast, the MDAX consists of 50 mid-cap companies.
Porsche was spun off from its parent company, Volkswagen Group, and listed on the Frankfurt Stock Exchange in September 2022. Following its initial public offering, which was the largest in German stock market history, Porsche's share price continued to rise, and the company was added to the DAX just three months after its listing, attracting significant attention. However, after once approaching 120 euros, the share price has fallen by two-thirds this year, dropping below 40 euros at one point.
At the same time, profitability has also deteriorated. Until last year, Porsche maintained an annual operating margin of around 15%, making it a key profit driver within the group. However, in the second quarter of this year, the automotive division's operating profit plummeted by 91% compared to the previous year. The annual operating margin forecast has also been revised downward to a range of 5.0% to 7.0%. The decline in demand for European luxury cars in China, the world's largest market, as well as stronger import tariffs in the United States, have been cited as the reasons for the company's worsening performance.
However, separately from the automaker Porsche, Porsche Automobil Holding (Porsche SE), the holding company of parent Volkswagen Group, will remain in the DAX index.
Oliver Blume, CEO of Porsche, stated on September 4 that he is determined to re-enter the DAX as soon as possible. However, local media have reported that the company is already searching for his successor internally.
Blume has led Porsche since 2015 and has also served as CEO of Volkswagen since 2022. However, both inside and outside the group, there have been ongoing concerns about this dual leadership structure.
Daniela Cavallo, chairwoman of Volkswagen's works council, said at a staff meeting on September 2, "It is not appropriate to spend only half of his time as CEO in Wolfsburg, where Volkswagen's headquarters is located, and devote the rest to Porsche," urging Blume to step away from managing Porsche and focus solely on Volkswagen.
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