German automaker Porsche is exiting Frankfurt's DAX index due to disruptions caused by US tariff disagreements
Porsche AG, the renowned sports car manufacturer and one of the largest listed companies in Germany, is set to leave the prestigious DAX index on September 22, 2025. This decision comes after a significant drop in Porsche's share value and other challenges that the company has faced in recent times.
The German automaker made its public debut at the end of September 2022, in one of the largest initial public offerings (IPOs) in the country's economic history. However, the journey since then has been a tumultuous one. The initial public offering price of Porsche shares was €82.50, but as of Thursday, they traded below €45, with the price having dropped 33% over the past 12 months.
Porsche's exit from the DAX index is due to a variety of factors. Over the past year, the company has been affected by US tariffs on car imports and has struggled with demand for electric vehicles, leading to the abandonment of its electric battery production plans. Furthermore, Porsche's share value has seen a significant decline, and the company's low free float has also contributed to this decision.
In response to these challenges, Porsche has implemented cost-cutting measures, including layoffs, as part of its transformation. The company's CEO, Oliver Blume, has pledged that Porsche will regain its spot in the DAX index as soon as possible. He is confident that the recent restructuring programs will cause Porsche shares to rise again in the future.
The DAX index, managed by Deutsche Börse subsidiary ISS Stoxx, tracks the performance of the 40 biggest companies listed on the Frankfurt Stock Exchange. Companies making up the index must fulfil certain minimum quality and profitability requirements. Deutsche Börse announced the replacement of Porsche AG with online marketplace Scout24 SE in the DAX index, effective on September 22, 2023.
Porsche's departure from the DAX index is not a permanent one, according to CEO Oliver Blume. He has expressed his determination to return the company to the index as soon as possible. The sports car manufacturer, which is part of the Volkswagen Group, will continue to strive for success in the competitive automotive industry.
As of the current time, Porsche continues to be one of the largest listed companies in Germany, with a market capitalization of almost €20.4 billion. Despite the challenges it has faced, Porsche remains a significant player in the global automotive market. The company's exit from the DAX index is a temporary setback, and it is expected to bounce back in the near future.
