Porsche’s high price and outdated technology are killing it

Local competitors are considered better value and have more smart features that Chinese buyers want

Chinese smartphone giant turns automaker Xiaomi proudly announced last week that its SU7 Ultra sedan filmed the Shanghai International Tour faster than previous record holder Porsche Taycan Turbo GT. But Porsche’s China crisis far exceeds the track queue and the board of directors ranked second.

More: Xiaomi SU7 Ultra Ultra Smash Taycan Turbo GT at Shanghai Track

Western automakers have relied on China to provide growth and substantial revenue for many years. But now, local car buyers are increasingly rejecting the long-standing European brands and supporting domestically produced Chinese-branded cars. Porsche is far from the only Western auto company that has been hit, but it is indeed big.

Porsche’s sales in China are free to fall

The automaker revealed last month that in 2024, Porsche sales fell 28% in 2024, and delivery of the once-popular Taycan EV dropped nearly half. Yes, 2024 is a year of conversion for several models including Taycan, Panamera (also Down) and 911, but the situation related to this is getting more and more with changing Chinese attitudes toward itself The attitude of a capable car brand has nothing to do with it.

For example, in the SU7, Xiaomi built an electric sedan that looks almost as good as the Taycan, making the score of more power and cost as much as possible. The top-spec Ultra breaks Shanghai Records priced at $112,000 for the Turbo GT, which is available for 1,527 hp (1,139 kW / 1,548 PS) while 1,092 hp (815 kW / 1,108 PS) boot control mode.

Other SU7 models also offer similarly attractive explosions with daily rates. No wonder Xiaomi sold more than 100,000 people last year, while Porsche moved only 21,000 Teikans.

“I think now Chinese consumers are ready to accept that Chinese companies can make cars that are considered premium,” Gary Ng, an economist at Natixis Corporate & Investment Banking, told The New York Times.

But here’s the crazy place: The SU7 is currently only for sale in China, while the 21,000-unit Taycan sales figure is global. Just imagine how much damage the SU7 could cause if it was available elsewhere.

Of course, in other markets, Porsche can currently rely on the strength of the brand, which has been cultivated over decades of racing history and pop culture appearance. In China, Porsche has been around for more than 70 years, and this is not an attractive event. Furthermore, the buyer’s hero is the tech brand, they hope that the tech features Porsche and Western brands cannot deliver, but Chinese brands can.

Porsche is playing technology catching up

You still can’t buy a Porsche with Level 3 or full driver-level 2 driver assistance system (although the latter, co-developed with Mobileye, will arrive this year), while the LIDAR-equipped SU7 comes with a 56-inch head display. And Xiaomi’s smartphone and AI knowledge means that drivers can enter the car and use a single button press to transfer the phone interface to the SU7’s media screen. An industry expert told The New York Times that German, American, and even Japanese and Korean brands underestimate the importance of software-defined vehicles.

More: Electric vehicles will be sold in China in 2025, 10 years ahead of schedule

But Chinese buyers are pragmatic and less obsessed with the classic ideas of driving entertainment. Exiting the manual waving is just giving us the technology, they effectively say by ignoring the Taycan and buying a car with a more advanced system (such as the SU7). Buyers are still young – an average of 33 years old for Taycan in 2021 – which suggests that they have the potential to switch brands more openly.

Can it happen in the West?

And if the choice between Porsche and Chinese products is, then to do the same thing at half the price, and even how long can it take between drivers in Europe and the United States, and start ignoring Porsche cars? I love cars like Macan and Taycan, but at least for four-seater models, let’s not pretend it won’t happen.

We welcome newcomers like Tesla and Rivian to see them as legitimate competitors of Porsche, so why not Xiaomi? Ford boss Jim Farley has said he loves driving the SU7 very much and he doesn’t want to give it back. U.S. tariffs and some lingering anti-China sentiment provide hillsides for climbing, but Chinese will climb it. Look at how far Kia has gone in 35 years, and then look at Xiaomi’s only one couple with a car.

How will you get Porsche back to China? Do you believe it will end up having the same problems in Europe and the United States, or does it have the brand power to stay ahead of the curve? Leave a comment below to let us know what you think.