Porsche is leaving Frankfurt’s DAX index amid US tariff turmoil
In a blow to the German carmaker, Stuttgart-based sports car manufacturer Porsche AG has been selected to leave Germany’s leading stock index, the DAX.
It will be replaced by online marketplace Scout24 SE, said Deutsche Börse subsidiary ISS Stoxx on Wednesday.
The change will come into effect on 22 September.
The DAX index tracks the performance of the 40 biggest companies listed on the Frankfurt Stock Exchange, and is usually seen as the barometer to check the health of the German economy.
Companies making up the index have to fulfil certain minimum quality and profitability requirements to make the cut.
Porsche AG, part of the Volkswagen Group, went public at the end of September 2022, in what appeared to be one of the largest initial public offerings (IPOs) in German economic history. Just a few months later, the then highly profitable company was promoted to the DAX.
The stock launched at an IPO price of €82.50 and rose to almost €120 in the months following. On Thursday, Porsche shares traded below €45, with the price having dropped 33% over the past 12 months.
Porsche CEO Oliver Blume told the Frankfurter Allgemeine Zeitung that the “DAX is losing one of the most valuable German companies", and he pledged that the firm would soon regain its spot.
Looking at the company’s market capitalisation, which amounts to almost €20.4 billion, Porsche continues to be one of the largest listed companies in Germany.
Even so, the carmaker has been hit hard by the US tariffs on car imports and has contended with lacklustre demand for electric vehicles, prompting it to abandon its electric battery production plans.
Porsche has also started cost-cutting measures, including layoffs.
According to Blume, the firm is undergoing a transformation, but with the recent restructuring programs, he expects the shares to rise again in the future.
“With Porsche's new direction, we have a clear ambition to return to the DAX as soon as possible,” the CEO said.
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