# Vision

“Times like this produce dreams”

Interview: Porsche CEO Oliver Blume on social responsibility, focusing on essentials, and optimism.

Oliver Blume, Chairman of the Executive Board of Porsche AG, is leading the sports-car maker and its 35,000 employees through the challenges posed by the coronavirus. He is optimistic about the future.Porsche

Mr. Blume, the coronavirus pandemic has taken governments, economies, and society at large by storm and is dictating new rules—for Porsche as well. What are you using for guidance during this time?

Oliv­er Blume: We’re being guid­ed by the cen­tral val­ues of our Porsche cul­ture. More than ever, what we want to do is work for the ben­e­fit of soci­ety and our fel­low human beings. We want to take care of each other and take respon­si­bil­i­ty –like in a fam­i­ly. These val­ues extend beyond our fac­to­ry gates. Right now we’re con­cen­trat­ing on where we as a com­pa­ny can be of help. For exam­ple, experts from our two con­sul­tan­cies, Porsche Con­sult­ing and MHP, have been sup­port­ing cri­sis man­age­ment teams for the states of Baden-Würt­tem­berg and Sax­ony over recent weeks and were instru­men­tal in procur­ing per­son­al pro­tec­tive equip­ment from China. We’ve also been encour­ag­ing our employ­ees to do vol­un­teer work, and we’re send­ing dona­tions to char­i­ties around the world. That’s all part of how we view our­selves as a com­pa­ny.

Should companies in general play a greater role in government affairs, like Porsche has done in procuring PPE for healthcare personnel?

Blume:Porsche has a long his­to­ry of pro­mot­ing non-prof­it ini­tia­tives. Sol­i­dar­i­ty and social respon­si­bil­i­ty are just part of what we do. This cri­sis affects every­one, and gov­ern­ment, busi­ness­es, and the pub­lic are all called upon to con­tribute. I am con­fi­dent that we will deal with the sit­u­a­tion suc­cess­ful­ly by work­ing togeth­er. And it’s expe­ri­ences like this that can have a last­ing effect on our society—to everyone’s ben­e­fit.

You mentioned taking a family-like approach—but the Porsche family has more than 35,000 members. That’s a lot of responsibility for an executive board when we’re talking about something as crucial as keeping people healthy.

Blume: Our goal is to get through this crit­i­cal peri­od in a sys­tem­at­ic and respon­si­ble way. That includes how we respond­ed very early on. As soon as we saw what the virus was doing in China, we con­vened a coun­cil of experts at Porsche. This coun­cil is mon­i­tor­ing the sit­u­a­tion around the clock, and has been mak­ing quite a few deci­sions. Our high­est pri­or­i­ty is always on pro­tect­ing the health of our employ­ees. This means that every­one who can work at home does so. Our con­fer­ences are held online, and busi­ness trips are can­celled. The few excep­tions are absolute­ly nec­es­sary. And for these, who­ev­er returns from an inter­na­tion­al flight has to self-quar­an­tine for two weeks. We make no com­pro­mis­es in this regard. The health of our com­mu­ni­ty is of para­mount impor­tance.

You don’t turn your back on long-time partners.

Oliver Blume
Chairman of the Executive Board
of Porsche AG

Porsche Consulting on the crisis management team

Porsche’s crisis management team enabled the company to respond rapidly as soon as the pandemic broke out. Together with the executive board, this interdisciplinary committee took on the complex job of defining the employee safety measures. In addition, difficult decisions had to be made about the stop of production for six weeks in March and April, and about how to start it up again in May. Representatives from health management, HR and social affairs, production and logistics, research and development, finances and IT, and sales and marketing came together—at least virtually—under the direction of plant security. Experts from Porsche Consulting were also there from the start, and facilitated the team’s rapid decision-making processes.

The pandemic appeared quickly, giving the crisis management team no time to practice.

Blume: Each indi­vid­ual team mem­ber imme­di­ate­ly had to set his or her inter­nal com­pass on han­dling this prob­lem. And I’m proud to say that it worked with­out a hitch. My col­leagues are doing out­stand­ing work. The cri­sis man­age­ment team met daily. The exec­u­tive board held spe­cial ses­sions every other day. Togeth­er we dis­cussed hun­dreds of ques­tions. Like where will we locate the dis­in­fec­tants for our employ­ees? How will we change the serv­ing pro­ce­dures at the cafe­te­rias? After stop­ping pro­duc­tion at our plants in Zuf­fen­hausen and Leipzig, what will we do to start it up again? What steps are need­ed before desk work­ers can return to their offices?

What decisions were especially hard?

Blume: At first we planned to stop pro­duc­tion for only two weeks. But it ended up being six weeks. One of the rea­sons had to do with bot­tle­necks in the glob­al sup­ply chains. That was very painful. But we won’t be deterred: we’re look­ing ahead and want to get back up to speed as soon as the cri­sis is over. I see major oppor­tu­ni­ties for Porsche in the future. Over the last few years we’ve launched a huge prod­uct cam­paign, includ­ing the Tay­can at the end of 2019. It gives us a superb foun­da­tion to build on.

The coronavirus has triggered a lot of discussion about the stability of global supply chains. Does the automotive industry have to change course and have its components produced locally instead of overseas?

Blume: Right now we’re con­cen­trat­ing on essen­tials. For the sup­ply chains, that means think­ing about which trans­port routes are real­ly nec­es­sary, and how we can reduce com­plex­i­ty in our logis­tics. Porsche will end up being even more robust in this regard. At the same time, we’re also look­ing at the big pic­ture and ask­ing our­selves how sus­tain­able our sup­ply chain is. To answer this ques­tion our cor­po­rate group has devel­oped a rat­ing sys­tem for sup­pli­ers, which includes both envi­ron­men­tal and social cri­te­ria. It is part of the eval­u­a­tion process for award­ing con­tracts.

Porsche has a tradition of maintaining close partnerships with its suppliers, starting in the development stage. How will these relationships change in the future?

Blume: When dif­fi­cul­ties arise, you don’t just turn your back on long-term part­ners. That too is part of our cul­ture at Porsche. Our sup­pli­ers know that they can count on Porsche to be a depend­able part­ner. The mes­sage we’re send­ing is that we’ll get through this togeth­er.

The pandemic landed smack in the middle of the automotive industry’s shift toward electromobility. Will the coronavirus pull the brakes on this transition?

Blume: Absolute­ly not. We’ve been pur­su­ing a clear and sus­tain­able prod­uct strat­e­gy at Porsche for years now. We’re going to keep fol­low­ing this path. Not only that—I think this cri­sis will sharp­en our aware­ness for a lot of things, and that we’ll be see­ing a marked increase in the pref­er­ence for elec­tro­mo­bil­i­ty. Many peo­ple are already putting more thought into what makes life worth liv­ing. I antic­i­pate an even greater con­cen­tra­tion on low-emis­sions tech­nol­o­gy. That’s one of the rea­sons we’re con­tin­u­ing to invest a lot of resources into future-ori­ent­ed tech­nolo­gies.   

So you aren’t putting the big topics of sustainability and digitalization on hold?

Blume: No, we’re stick­ing to our CO2 tar­gets and not budg­ing from our sus­tain­abil­i­ty strat­e­gy. We’re receiv­ing expert advice on this. Over the next five years we’ll be invest­ing 15 bil­lion euros in areas like elec­tro­mo­bil­i­ty, sus­tain­able pro­duc­tion, and dig­i­tal­iza­tion. The coro­n­avirus will not change this in the slight­est.

Porsche

Now is not the time for debates on principles.

Oliver Blume
Chairman of the Executive Board of
Porsche AG

Porsche has been posting record sales now for years. Over the past five years, results have risen by more than 60 percent. What are the chances of getting back on this track soon?

Blume: Gen­er­al eco­nom­ic and pol­i­cy con­sid­er­a­tions will con­tin­ue to pose chal­lenges over the next sev­er­al months. We’re gear­ing up for them at Porsche. That includes tak­ing steps to increase our effi­cien­cy. Over the longer term we’ll be mov­ing into new prof­itable busi­ness fields. And we’re con­tin­u­ing to pur­sue our strate­gic goal of a 15 per­cent oper­at­ing return on sales.

How long do you think it will take for the overall economy to recover?

Blume: We don’t yet know what the actu­al effects of the coro­n­avirus pan­dem­ic will be—either for Porsche or for busi­ness and soci­ety at large. The task at hand is to jump-start the econ­o­my. We’re fac­ing an eco­nom­ic cri­sis and have to pre­vent a down­ward spi­ral. Now is not the time for debates on prin­ci­ples. We need to focus on the econ­o­my and take action prompt­ly; oth­er­wise, time will work against us.

What makes you confident about the future?

Blume: The opti­mism I see in so many peo­ple as they go about their work. Every­one is focus­ing on the essen­tials, and sup­port­ing each other. And it’s times like this that pro­duce dreams and needs. There might even be a greater need for sports cars when the cri­sis is over—that at least would be my wish.

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