It turns out that Porsche’s aggressive push into the world of EVs has not paid off the way the company hopped. In fact, the automaker admitted that its heavy commitment to EVs, followed by a sudden change of course, carved a €1.8 billion ($2.1 billion) hole in its operating profit. Investors reacted quickly, and Porsche shares in Frankfurt tumbled by as much as 9.3 percent, the sharpest intraday fall since its high-profile 2022 listing.

Read: Porsche Is Sneaking Gas Power Back Into The Next 718

Earlier this week, Porsche made the sudden, but not unexpected announcement, that its new flagship SUV, currently known as the K1, will not launch as a fully-electric model as originally planned and instead debut with combustion and plug-in hybrid powertrains. Porsche also confirmed that range-topping versions of the next-generation 718 Cayman and Boxster will be offered with combustion engines, despite the new models originally being designed exclusively as EVs.

The move is meant to stabilize margins, but it also makes clear that the brand’s earlier electric strategy was both too costly and out of step with what its customers actually wanted.

Shares in Freefall

Following news of the dramatic change of plans, Porsche’s share price in Germany slumped by as much as 9.3 percent and is down almost 30 percent this year, Bloomberg reports. The decline this year has been steep enough to push the company out of Germany’s DAX benchmark index. In addition, Porsche has already been forced to cut its profit guidance four times this year alone.

The ripple effects are also hitting the wider VW Group too. According to Bloomberg, the sports car maker’s parent company will take a €3 billion non-cash impairment related to Porsche’s decisions, prompting it to lower its operating return forecast from as much as 5 percent to between 2 percent and 3 percent.

Porsche 718 Boxster Electric

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Doubts from Analysts

Auto analyst Matthias Schmidt told the publication that buyers “are putting little value on luxury electric cars,” which explains Porsche’s return to high-margin combustion models. Citi analyst Harald Hendrikse was even more direct, pointing out that “Porsche has now been disappointing investors for over two years. It is hard to conclude that these disappointments have now completed.”

Things are so bad that VW and Porsche chief executive Oliver Blume is facing mounting pressure to relinquish his role as the head of Porsche, allowing someone else to lead its turnaround. Reports state that the search for a new Porsche CEO has already started, and the Porsche-Piech families are having discussions with potential candidates.

Porsche has made a few goofs in its time, including thinking it could replace the 911 with the 928 and dropping combustion power from the 718 lineup. It wisely U-turned on the first of those decades ago, and it’s just confirmed it has backtracked on the second. The next Boxster and Cayman, originally planned as EVs only, will now get an ICE option, but only a small portion of buyers will be able to access it.

The rethink was confirmed late last week by Porsche on an investor call, where CEO Oliver Blume acknowledged that the EV market was no longer growing fast enough for the company to carry on with the electric-focused product strategy it conceived years earlier.

As a result of the slide, Porsche is refining its plans to incorporate more combustion models, some of which will be “highly emotional” derivatives appearing at the “top” of the 718 lineup.

Related: Porsche Might Give Manual Fans More Of What They Want

No major details were released, but a likely explanation is that replacements for the Cayman GT4 and GT4 RS, and 718 Spyder, could carry on with six-cylinder petrol power. The regular 718 cars will stick with the single and dual-motor electric drivetrains Porsche has been developing since it conceived the next-generation sports cars purely as EVs.

Adapting the electric platform to take a combustion engine isn’t the work of a moment, however. The 718 EVs will debut in 2026, but a presentation slide confirmed we’ll have to wait until later in the model cycle to see the combustion halo cars.

Porsche

Porsche will obviously pitch them as the enthusiast’s pick, and it sounds like they’ll be the most expensive versions you can buy. The combustion cars might also be quicker around a track – we reported earlier this year that Porsche was struggling to get the new EV prototypes to handle as well as the outgoing ICE cars – but they’ll almost certainly be annihilated in a straight line by one of the dual-motor, all-wheel drive EVs.

Similarly, Porsche also confirmed at the same time that it was backtracking on its electric SUV plans. The Macan will no longer switch to an EV-only lineup and will now get a new ICE/PHEV model range before the end of the decade. And the SUV flagship, codenamed K1, which was also planned as an EV, now won’t get a BEV version at all, and will instead be offered with a choice of combustion and hybrid engines.

Porsche 718 Cayman Electric

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Porsche 718 Boxster Electric

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For decades, buyers looking to park a Porsche sports car in their driveway could choose between the Boxster, the Cayman, and the 911. However, as Weissach continues its shift towards electrification, the ICE-powered 718 Boxster and Cayman have been killed off.

The decision isn’t a complete surprise. Enthusiasts have known about the models’ eventual demise for a while, and in some regions, they were already removed from sale. Now Porsche has confirmed that order books worldwide are officially closed. For those still hoping to buy a brand-new example, the only option left will be unsold stock sitting with dealers.

Read: Porsche’s Electric Sports Cars Delayed Again As Problems Mount

Although new orders are no longer being accepted, as reported by Autocar, Porsche has yet to confirm when production will officially stop. Some reports suggest it could take until 2026 to complete the backlog of 718 Cayman and Boxster builds already on the books. While the company hasn’t addressed those rumors, the final cars to leave the factory may well end up as sought-after collector pieces in the years ahead.

As mentioned above, the writing has been on the wall for the two models for several years. In early 2024, Porsche was forced to stop selling the Cayman and Boxster in Europe because they failed to comply with cybersecurity regulations and it deemed that wasn’t worth updating them to current standards.

An Electric Future

While the ICE-powered 718 twins we know and love is dead, the Cayman and Boxster names will live on as Porsche is currently in the midst of developing all-electric versions of both. Prototypes have been spied testing frequently during the past two years and the production models are expected to launch by 2026.

It’s understood that Porsche will sell the new models in single-motor, rear-wheel drive, and dual-motor, all-wheel drive versions. There’s no word on tech specs just yet, but it stands to reason that they’ll be quicker than their predecessors.

However, while we trust the German brand to ensure the driving dynamics will match those of their predecessors, making them stir the same kind of emotions with an electric, instead of a combustion, powertrain may prove a hard task.