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Porsche seeks US$4.37 billion loan

By Alborz Fallah |

Following on from our previous story on Porsche’s financial issues, the German manufacturer has just announced that it will apply for a 1.75 billion euro (US$4.37 billion) loan from German state bank KfW.

A Porsche spokesman said the company did not aim to obtain state loan guarantees and intends to pay back the loan with interest.

As it stands the German bank has not yet granted the loan and Porsche is uncertain as to when the decision will take place.

Porsche is not the only German corporation in financial trouble. Numerous other high profile German companies have asked for aid from the government and KfW as a result of the current global economic crisis.

Earlier this year Porsche tried to raise 12.5 billion euro (US$21.86 billion) in loans, however it only managed to get 10 billion euro and a further 700 million euro last week (borrowed from merger partner Volkswagen).

The once wealthy manufacturer currently owns a 51 per cent voting stake in Volkswagen, and partially as a result of this purchase Porsche is now struggling under a nine billion euro (US$15.75 billion) load of debt (recorded at the end of January).

The questions to be asked are what does the future hold for Porsche and was the aggressive attempted take over of Volkswagen a wise move?


 
  • Devil666

    Short answer: Yes, with a maybe.

    Long answer: No, with a but.

  • RoFlmaTiC

    I was under the impression that Porsche was one of the richest auto manufacturers. Guess I was wrong…

  • Marcoz

    2 days ago they said they will have 1 billion in profit now they want cash handout….
    YOu make that panamera, you will need alot more cash handout as it is FUGLLYYYYYYYY….

  • Mick

    So the Porsche parent company is struggling, what does it mean for the VW Group.
    If Porsche own 51% of VW AG and the money is drying up at the top will it then stream down to Audi, Lamborghini, Skoda, Bugatti, Bentley etc?

    Shall be interesting, we may see another GM style sell off.

  • nobody

    It was a very ambitious move on Porsche behalf to take over VW. They were gonna up their stake over 70% of VW but the whole financial crisis really hit hard. The whole buying VW shares might have been a good move if the whole economy situation didn’t happen. And even then it would’ve been a big risk.

  • Tom

    Mick, no that won’t happen. Porsche and VW are currently separate, their only link is those 51% of VW shares that Porsche owns. Which was bought with the loans that are now responsible for Porsches debt load. If Porsche wants to significantly reduce its debt, it would just sell its shares and VW would court new investors.

    End of the day Porsche is profitable, but debt laden. I do think it was a mistake for Porsche to try and take over VW, particularly the rapid fire way they went about it. The financial crisis didn’t help, but if you are going to take over a company many times your size, do it at a sustainable rate.

  • charles

    Another GM sell off, doubt it, considering Porshe is asking VW for a loan I`m pretty sure VAG are fine

  • http://carz.com/ Carz

    I thought too Porsche is a very rich company. There’s nothing wrong with borrowing money, as long as they pay.

    Porsche still makes great looking cars even if they are lacking money this days.

  • Realcars

    Simple just charge more dumbcoff

    Geez the 911 or whatever it’s called at the moment can’t owe them much.

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