When it comes to bad news at listed public companies, management are rarely at a loss to explain away the causes. There is a tendency to look for reasons in others, rather than in themselves. In this way, top managers make themselves look better to the outside world by shifting responsibility onto third parties – outside their sphere of influence.

Porsche is not immune to this psychological phenomenon, as the latest profit warning from the luxury car brand based in Stuttgart-Zuffenhausen shows. Flood-related production losses suffered by suppliers mean that the Volkswagen subsidiary is likely to miss its previous earnings, turnover, cashflow and e-sales targets for the current year, and is therefore cutting its forecast for 2024. „I can hear the message, but I lack faith,“ might be an appropriate quote from Goethe.

Porsche has a credibility problem on the stock market, if you take the reaction of investors to the sports car manufacturer's ad hoc announcement as a yardstick. The announcement was published at a time when most people in Germany were in a deep sleep. The share price fell by 8%. At 68 euros, the share is miles below the issue price of 82.50 euros for its stock market comeback in 2022.

CEO Oliver Blume recently attributed the dramatic slump in sales in the first half of the year in China to the economic weakness there. Now, alleged problems at suppliers are being cited as the reason why Porsche's operations will also be bumpy in the current second half of the year. Blume originally held out the prospect of an improvement from the middle of the year, when new e-models come onto the market.

The causes may lie within the company itself. Porsche is clearly struggling to keep pace with the global transformation of the automotive industry towards electromobility. In any case, Porsche is currently off track strategically.