Automotive: Porsche SE sees its salvation in defense

At MarketScreener, people who think a lot about investments had been flagging for some time the hypothesis that the ailing automotive industry could not remain deaf to the billions promised to the defense sector. Porsche's holding company has officially taken the plunge.

Porsche Automobil Holding SE (the parent company of the Volkswagen/Porsche automotive empire, not to be confused with the subsidiary Porsche AG, which manufactures the eponymous sports cars) has found a bold way to sell dreams again (and perhaps something else as well, ultimately).

Officially, the shift is cautious, reasonable, and based on robust financial capabilities. The holding company wants to become a "diversified investment platform" after identifying "significant development potential in the defense and security sector." In other words, the German auto industry is suffering, and Berlin is ready to put hundreds of billions on the table to rebuild an army worthy of the name. Follow the money, so to speak, to a sector that is relatively immune to the vagaries of polluting emissions, customs duties, strikes, strained logistics flows and Chinese electromobility.

Defense systems? They've been back in vogue since a Russian tank rolled into Ukraine three and a half years ago, especially with a "Made in Germany" sticker on it. No! Not for the reason you're thinking, but because of the German government's budget shift. It's a way to restore the tarnished image of Deutsche Qualität with billions of dollars. "Our goal is to increase our exposure to the defense and related technology sectors, while maintaining our core business focused on mobility and industrial technology," explained Porsche SE President Hans Dieter Pötsch in the press release announcing the group's plans.

To kick things off, Porsche SE wants to organize a "Defense Day" to bring together German and European family offices that want to invest in this area or strengthen their position in it.

But the group, which insists it wants to keep its core business in mobility and industry, also intends to invest in defense outside this platform, i.e., directly, one imagines. The main targets? Satellite surveillance, intelligence and sensor systems, cybersecurity, as well as logistics and supply systems. No armored vehicles bearing the 911 Turbo logo are in the pipeline yet, but who knows?

NB: the illustration was generated with the help of AI.