Considered Unprofitable, Porsche Cancels Its Own Battery Production

JAKARTA Germany's auto giant Porsche made a surprising decision by stopping their high-performance battery production plans. This step was taken due to the slowing down of the global electric vehicle (EV) market and was deemed "economically inappropriate" for the company.

Porsche stated that their internal battery division, Cellforce, will no longer pursue battery cell production. Instead, Cellforce will shift its focus entirely on battery cell research and development (R&D). This decision was triggered by the slow demand for EVs, especially in key markets such as the United States and China.

"Porsche is one of the most successful traditional car manufacturers in transformation towards electric mobility. In the first half of 2025, 57 percent of vehicles delivered in Europe were electrified, compared to global electric quotas of 36 percent. However, due to challenging conditions, especially in our main market in the United States and China's undeveloped electric luxury car segment, we are reorganizing our battery activity and focusing on cell and system development. Because of the volume and lack of economic scale, Porsche is no longer producing its own battery cells. Electromobility will remain an important driving technology for our future sports cars," said Porsche and Volkswagen Group CEO Oliver Blume, quoted from the Porsche Newsroom website, Tuesday, August 26.

With production cancellation, the Cellforce plant in Germany, which was originally planned to produce 1 GWh of batteries per year, will not operate as planned. About 200 out of nearly 300 Cellforce employees are rumored to be laid off. However, the rest of the other employees will be offered a position in Volkswagen battery subsidiary PowerCo.

The move reflects the huge challenges facing European battery companies amid the dominance of Chinese manufacturers such as CATL and BYD that offer lower costs. Nonetheless, Volkswagen Group's grand plans for battery factory investment are still running, with three large factories scheduled to operate in Spain, Germany and Canada. Meanwhile, Porsche will continue to rely on large battery suppliers, such as CATL for the Electric Tigers and LG Energy Solution for Taycan.