Porsche, vrooming ahead auto-matic

Porsche has overtaken former parent Volkswagen as Europe's most valuable automobile company shortly after its listing in September this year. This seemingly anachronistic valuation of the maker of iconic fuel-burning sports cars during a global energy crisis is influenced by Porsche's plan to have 80% of its newly sold cars electric by 2030. At around $90 billion, Porsche has slightly above 5% of the $1.6 trillion market capitalisation of automobile companies worldwide, which is dominated by electric carmaker Tesla's eye-watering $385 billion valuation. Volkswagen and Porsche combined approach the market capitalisation of Toyota, the world's largest carmaker by sales, that is rewiring its electric strategy after initial missteps. Porsche's triumphant listing itself is part of Volkswagen's plan to accelerate electric mobility across the group. The market is rewarding transition over current output.

Porsche is, however, not giving up on internal combustion for motor sports. It has started production of synthetic methanol from water, hydrogen and carbon dioxide (CO2) that can serve as an alternative to petrol. E-fuel can be pumped through existing networks without having to wait for charging infrastructure to come up. Yet, Porsche and its partners developing the CO2-neutral fuel don't plan to produce enough for it to become a serious alternative to petrol. The synthetic fuel is, in effect, an attempt at staying relevant as a maker of internal combustion engine sports cars while Europe brings down the curtains on fuel burners.

So, is the future of sports cars all-electric? Not yet, if Porsche's hedging strategy works. The company is living up to its stature by making a big impact in electric mobility. It will take carmakers leading the renaissance considerable effort to dislodge Porsche from its dominance of 3% of the global car market by revenue that constitutes sports cars. Porsche and Tesla are pushing the envelope in motor sports, which ought to yield wider gains for the electric vehicle market overall.