Porsche AG

Company information

• Date Founded: 1931
• Industry: Automotive
• Corporate Headquarters: Stuttgart, Germany
• Type: Public

The history of Porsche AG’s high-performance luxury automobiles began in 1931 when engineer and former Daimler executive Ferdinand Porsche (1875–1951) opened his own business, with his son Ferry (1909–98) joining a few years later. The cars were initially intended for racetracks rather than ordinary roads. After World War II, father and son worked together to design the Porsche 356, the road car that would make the company famous. They built the company into one of the most respected automobile manufacturers in the world, and Porsche AG has maintained its reputation for building luxury cars tuned for performance.

In the twenty-first century, Porsche AG is a global enterprise with plants and subsidiaries all over the world. However, it is still very much a German company. It is owned by fellow German company Volkswagen AG. Porsche automobiles are still built in Zuffenhausen, which is also home to management and logistics teams. In 1972, Porsche established a research and development center in Weissach, which also houses design offices and the motorsports department. Customer service is centered in Bietigheim-Bissingen. Since it began producing race cars in the 1950s, Porsche vehicles have won more than thirty thousand auto competitions. In the 2010s, Porsche began producing hybrid and electric cars, and into the mid-2020s, Porsche expanded their lines of these vehicles to meet consumer demand.

History

With the introduction of the 356 in 1948, Porsche AG began its practice of naming vehicles after the number assigned to its design project. The first fifty-two Porsche automobiles had been built by hand at a garage in Gmund, Austria. The success of those cars allowed Porsche, in 1950, to begin building car bodies as well as engines in Zuffenhausen, a suburb of Stuttgart. That same year, the first Porsche was imported to North America. After the death of Ferdinand Porsche in 1951, Ferry Porsche continued to upgrade the company’s capabilities and expand its reputation. With the introduction of the 550 Spyder, made famous by actor James Dean, Porsche AG began to be considered in the same category as luxury automakers Ferrari, Jaguar, Maserati, and Aston Martin. Demands for a more affordable Porsche led to the introduction of the Speedster in 1954. By the end of the decade, Porsche was forced to outsource body production to meet high demands.

In the 1960s, Porsche set up distribution areas across Europe and debuted the 911 in 1964. The 911’s rear-engine design set the standard for Porsche automobiles. Again rejecting the notion of outsourcing, Porsche acquired its subcontractor, allowing it to resume manufacturing its own automobile bodies and stepping up annual production to eleven thousand cars. By mid-decade, Porsche had premiered the four-cylinder 912, melding the features of the 911 and the older 356. Innovations of the period included the removable roof of the 1966 Targa and the semiautomatic transmission of the 1967 Sportomatic. The 911 S of 1967 remains a particular classic.

Porsche continued to produce some less expensive models in the 1970s, debuting the 914, with a four-cylinder Volkswagen engine, in 1970. Two years later, Ferry Porsche left management, opting to become chair of Porsche AG’s supervisory board. By 1976, the 911 Turbo had become available in the United States. That same year, Porsche AG began producing cars with front-end engines, such as the four-cylinder 924. Porsche manufactured its first automobile with an eight-cylinder engine in 1978. This was named the 928, and it was followed by the more powerful 924 Turbo. In 1982, Porsche Cars North America was established in Reno, Nevada. The following year, the 911 Cabriolet debuted in the United States. By the end of the decade, Porsche had built a new factory to produce automobile bodies and had agreed to build a high-performance sedan for Mercedes-Benz.

By the last decade of the twentieth century, Porsche AG had built a solid reputation, but the company had begun experiencing major financial problems and was facing the possibility of a hostile takeover. Wendelin Wiedeking, the company chair, turned the company around by appealing to owners with more modest means and by refocusing efforts on the vehicles that had made a significant impact on sports car enthusiasts around the globe. The result of Porsche’s new focus was the Boxster, which paid homage to the classic 550 Spyder. Porsche continued to produce both rear-wheel and all-wheel drives, and the Carrera 2 in 1991 offered a choice between a fully automatic transmission and a clutchless manual drive. By mid-decade, Porsche had produced its one-millionth car. In 2002, Porsche released the Cayenne, a mid-size luxury crossover sport utility vehicle.

In the 2010s, Porsche returned to its founder’s engineering roots: electric cars. The company soon found success with hybrid vehicles, such as partly electric-powered versions of the Cayenne and the Panamera. Porsche announced that 60 percent of European buyers of the Panamera model opted for the hybrid version released in the summer of 2017, greatly exceeding expectations. In 2015, with the Porsche Mission E concept car, Porsche unveiled its plans for its first all-electric four-seat sports sedan, which could travel more than 500 kilometers (310 miles) before requiring a recharge. The Mission E hypothetically requires only 3.5 seconds to go from 0 to 100 kilometers (62 miles) per hour. In preparation for the car, Porsche built its first 350kW, 800V charging station in 2017, able to charge the Mission E up to 80 percent within fifteen minutes. In 2018, Porsche announced that the Mission E model was renamed the Taycan. Porsche revealed a prototype of the Taycan in March 2019. By the mid-2020s, the Taycan line-up had expanded to include seven models and had increased battery life and shortened charging time. Porsche had also expanded its hybrid offerings, including introducing the first hybrid model of its iconic 911 in 2025.

Impact

Porsche remains well-known in much of the world as a premier luxury and performance automobile brand. Its racing-derived innovations have made its models popular among performance-minded consumers since its founding. Over the company's history, it also gradually began to appeal to a wider audience. With the Boxster, for example, it drew a slightly younger customer base than its usual customer—between thirty-six and fifty-five as compared to forty-six to sixty-five. Moreover, although about 90 percent of 911 owners were male, the Boxster of the 1990s was designed to appeal to women also, and about 30 percent of Boxster owners were female. In 2003, Porsche debuted the Cayenne Turbo and the Cayenne S sport utility vehicles, and the Panamera came out in 2009. The Cayennes and Panameras also proved quite popular among American women.

In 2009, Porsche opened a museum in Zuffenhausen, allowing it to exhibit over eighty vehicles at a time. Around the same time, however, Porsche’s involvement in Nazi Germany became more widely known. Father and son developed the prototype of the Volkswagen Beetle at the behest of the Third Reich. During World War II, they also directed the production of military vehicles, utilizing forced labor to help manufacture them and later parlaying profits from that period into the Porsche automotive operation after the war. The company has paid reparations to some survivors but has been reluctant to address the issue.

The early twenty-first century also saw Porsche involved in a securities scandal in response to its purchase of 31.5 percent of Volkswagen, beyond its existing 42.6 percent stake. Porsche officials claimed they had been trying to save Volkswagen from a hostile takeover. However, more than thirty international hedge funds accused CEO Wendelin Wiedeking and CFO Holger Haerter of securities fraud, claiming that they had started rumors that Porsche was taking over Volkswagen in order to inflate Volkswagen stock. Investors lost $38.1 billion when Volkswagen shares plummeted and then filed suit against Porsche. Ultimately, it was determined that the Securities Exchange Act of 1934 did not give American courts authority over international securities transactions. Because of the global financial crisis in the late 2000s, Porsche ended up being bought out by Volkswagen in 2009 instead. The two companies have a long history of collaboration and other ties, and Volkswagen itself would become majority-owned by Porsche SE, a holding company that had previously been split off from the auto manufacturing Porsche AG.

Through its ownership by Volkswagen, Porsche was involved in a scandal over Volkswagen's cheating on emissions testing of its diesel-powered cars. Some Porsche models were implicated in the US class-action lawsuit over the issue, along with Volkswagen and Audi-branded cars. In December 2016, Volkswagen agreed to fix or purchase back affected vehicles—about 80,000 cars across the three brands—following an earlier agreement focused specifically on Volkswagen models. Owners were also promised compensation.

In early 2022, Volkswagen announced it was considering spinning off Porsche into a separate company. Its strategy was to do this and also to raise cash through an Initial Public Offering (IPO) of Porsche stock. Volkswagen followed through with making its Porsche subsidiary a public company. This move was widely viewed as very successful, as Volkswagen was able to acquire approximately 43 million euros. In 2023, Volkswagen CEO Oliver Blume, who holds a similar position with Porsche, announced that the company would make a significant investment in software, battery manufacturing facilities, and other accessories necessary for electronic vehicles (EVs). This signaled a major change for the company, which had a predominant focus on diesel engines. The German companies have joined American, Chinese, and Japanese counterparts in acknowledging the expected expansion of the EV market.

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