What Does The Scrapping Of Porsche’s Cellforce Mean For EVs?

The EV battery market at present is in a state of significant flux, which has led to some wildly different conclusions surrounding the future of battery-powered cars and the raw material supply chain surrounding them.

Exactly what the news is depends on what part of the supply chain you belong to and where you supply to, as the news in Europe and the UK is significantly more positive than it is in the United States and for companies aiming to enter the Chinese market.

A study by the University of Exeter published in Motor Trader noted that the EV market is reaching a tipping point, something that was corroborated by a survey of used car dealers who almost universally agreed (93 per cent) that motorists are considering buying an electric car.

After a long time of cautious optimism, the question has become a matter of when rather than if EVs hit a critical mass with the complete and comprehensive infrastructure they need.

However, this optimism has been tempered somewhat by the rather cautiously worded statement by German luxury carmaker Porsche stating that they are no longer planning to produce their own batteries through their Cellforce project.

The statement itself is a fascinating reflection on the EV market’s chaotic complexities in an age where there are attempts to make the tide go back.

What Was Cellforce?

Cellforce was an independent high-performance battery project that was an attempt by Porsche to vertically integrate all aspects of the production of its luxury electric sports cars.

This was seen as an investment in the future of the company as it moves away from petrol and diesel cars in the wake of increasing bans on internal combustion engine cars.

The transition is taking place at varying rates. In Europe, the plan to aggressively electrify makes sense when over half (56 per cent) of the company’s cars sold in Europe are EVs.

The goal was to build a supply of high-performance EV batteries from their factory in Kirchentellinsfurt before scaling further and creating a Northvolt-style European battery superpower to rival China and the USA.

They were not the only European manufacturer looking to reduce dependence on imported batteries; Northvolt and Britishvolt were two other major gigafactory plans that ultimately fell through for very different reasons.

What Went Wrong?

In Europe, Porsche’s focus on what it calls “electromobility” has been an undeniable success; they have seen a much higher proportion of sales of EV cars (both BEVs and hybrids) in Europe compared to their worldwide sales (56 per cent vs 36 per cent).

However, whilst the general trend worldwide is moving towards an EV tipping point, one of the most notable exceptions to this is in the United States, which is also one of Porsche’s largest markets.

Porsche is disproportionately affected by tariffs compared to some of its competitors, due to having no manufacturing facilities in the USA, which has significantly increased the costs of their new cars, which inherently will disproportionately hit their EV models hardest.

Given the rather surprising and haphazard way in which these tariffs were announced, the US market for electric Porsches was ended before it had a chance to begin.

As well as this, cuts to EV incentives in the country have hurt the entire market.

In China, by contrast, the EV market is thriving, but the main focus of the market is low-end domestic vehicles rather than luxury imports, particularly those sold by marques such as MG, SIAC and BYD.

What Happens Next?

Porsche intends to keep Cellforce around as a research and development laboratory, but 200 people are expected to be made redundant or transferred to PowerCo, the battery division owned by Volkswagen.

In some respects, it highlights that the development of the European battery market will be somewhat slower than the aggressive ambitions displayed in the early 2020s, although there are clear signs of interest and growth.

Porsche is hedging their bets, selling both an electric and an ICE version of the Cayenne in its relevant markets.

This is in stark contrast to the smaller Macan, which in many markets outside the UK is only sold as an EV.

There is the question of whether the Cellforce project was already too late, with the aggressive approach taken by Tesla, MG, and BYD having already captured a major part of the EV market before the plan could come to fruition.

Alternatively, the sudden policy shifts in the US in 2025 caught the market by surprise and artificially caused its downturn.

It is a time of both chaos and cautious optimism.