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    Porsche pockets $17,250 on every car

     

    Bloomberg article :-

    Source: Porsche

    Porsche Pockets $17,250 Profit on Every Car

    That’s operating profit per car, compared to about $5,000 for Daimler and BMW. How do they do it?

    by 

    Kyle Stock

    March 20, 2017, 6:00 AM GMT

    Porsche’s profit machine, already humming, just shifted up.

    The Volkswagen AG brand delivered 238,000 of its sinuous vehicles last year and posted an operating profit of 3.9 billion euros ($4.1 billion), up 14 percent from 2015. Put those numbers together and it’s on pace to net about $17,250 a car 1 , up 9 percent.

    In short, every time Porsche sells a 911 sports car or one of its Cayenne SUVs, it could take the profit alone and go buy a brand new Chevy Cruze.

    Its Teutonic peers don’t have nearly as much profit punch. Daimler AG pocketed about $5,000 a vehicle last year, roughly the same margin Bayerische Motoren Werke AG (BMW) has been managing. Part of the money magic is simply price. Porsche doesn’t make cheap cars. Even luxury players like Mercedes occasionally offer more pedestrian versions at narrower margins to get aspiring buyers into the family. And make no mistake, Porsche customers are paying a premium for the brand’s reputation.

    Ferrari knows this game well. Its operating profit equates to almost $90,000 a vehicle. But about 30 percent of Ferrari’s business comes from engines, key chains, amusement parks, and other things that don’t have wheels. What’s more, the company makes only about 8,000 cars a year, scrimping on supply to keep prices high.

    Porsche's 911 GT3 RS has 500hp and 338 pound-feet of torque and fetches $144,000 and up.

    Photographer: Gianluca Colla/Bloomberg

    Porsche isn’t that precious anymore. In terms of product, by now it’s about one-tenth the size of BMW, and in the past three years has boosted its annual output by 47 percent. That ramp-up comprises the company's new 911 GT3sports car, which commands $144,000 and up. Plus, the company's profit spike has coincided with the launch of its most affordable model. Hitting dealerships in 2014, the Macan SUV now accounts for roughly 40 percent of Porsche sales.

    Employees check a Porsche Macan sport-utility vehicle (SUV) inside the Porsche AG factory in Leipzig.

    Employees check a Macan sport-utility vehicle (SUV) inside the Porsche factory in Leipzig.

    Photographer: Krisztian Bocsi/Bloomberg

    These days “the little tiger,” as they call the Macan around the shop, starts at a prosaic $47,500. But few people who spring for a Porsche settle for basic—it’d be like going to a steakhouse and skipping the sides. The add-on Macan goodies step up as quickly as paddle-shifts on the car’s PDK transmission: big 21-inch wheels ($5,400), natural leather seats in “espresso” ($4,920), butt-warmers front and rear ($1,060), running boards ($1,250), sport tailpipes ($950), whitewashed oak trim ($1,790) and, naturally, a custom paint color to match your lover’s eyes ($6,520).

    “We’re concentrating on delighted customers,” Oliver Blume, chairman of the Porsche executive board, said in a statement.

    The whole process is customized and emotional, the goal of any luxury brand these days. People don’t just want a fancy scarf or an opulent handbag anymore; they want theirfancy scarf, their ostrich-skin purse—because, well, these days they can get it. TAG Heuer pitches its new smart watch as available in 4,000 configurations. The price range is $1,650 to $17,000. It's do-it-yourself market segmentation.

    Porsche’s revenue breaks down to almost $99,000 per vehicle. One of the few options that’s still free: factory pickup. If you’re just joining the club, you might want to skip the espresso seats and buy a plane ticket instead. 


    --

     

    Porsche Boxster GTS Carrara white / Volvo V40 D4 R Design daily drive

     


    Re: Porsche pockets $17,250 on every car

    Wasn't it over 20k for the 911 a few years ago? angry indecision


    --

    RC (Germany) - Rennteam Editor Porsche 991 Carrera 4 GTS Cabriolet (2015), Porsche Cayenne S Diesel (2017), Audi R8 V10 Plus (2016), Mini JCW (2015)


    Re: Porsche pockets $17,250 on every car

    That's the average, they can't have 17k of profit on every Macan, and they sell a lot of Macans and bringing down the average.


    --

     

     


    Re: Porsche pockets $17,250 on every car

    I don't mind Porsche making avg of $17K per car on me if they provide me cars that satisfy and exceed my driving needs.

    Besides, some of my Porsches depreciate much less than the norm indecision


    --

    Tim

    2010 997.2 GT3RS;  2008 Cayenne Turbo;  2006 911 Club Coupe;  2016 911 GTS Club Coupe;  2015 Macan S
     


    Re: Porsche pockets $17,250 on every car

    The $90K profit per car for Ferrari is the interesting bit!

     


    Re: Porsche pockets $17,250 on every car

    All marketing academics try to estimate brand power or brand value; this here is the ultimate metric.

     


    Re: Porsche pockets $17,250 on every car

    KMM:

    All marketing academics try to estimate brand power or brand value; this here is the ultimate metric.

     

    Concur about profitability being the ultimate metric.  To put Porsche's per unit profitability into perspective, Ford is said to earn roughly $13,000 per unit on the F-150 pickup truck, based on an average sales price ("ASP") of $44,000.  Percentage wise, Ford's truck is extremely profitable, even for the higher material cost of using aluminium instead of steel for the body of the current version.  Even more impressive, were Ford's profitability in the late 1990s when it earned $7500 per Ford Explorer, ASP of $25,000 and over $15,000 to $20,000 per Ford Expedition and Lincoln Navigator.  During that windfall period, the assembly plant in Wixom, Michigan was responsible for more than 1/3 of Ford's global profits.  


    Re: Porsche pockets $17,250 on every car

     In the US, Porsche and Audi carry VW. The rather small amount of pure VW products sold in the US can never recoup the $23 billion penalty VW paid for it's emissions debacle. The luxury tails are wagging the corporate dog.


    Re: Porsche pockets $17,250 on every car

    KMM:

    The $90K profit per car for Ferrari is the interesting bit!

    Ferrari sells only around 8000 cars per year and many of them are in the higher price range.

    Also, more than 30% of the Ferrari profits are from amusement parks, accessories and engines, so I'm not so sure if Ferrari really makes that much profit per car. Other sources speak of around 60k per car, which would still be pretty impressive.

     


    --

    RC (Germany) - Rennteam Editor Porsche 991 Carrera 4 GTS Cabriolet (2015), Porsche Cayenne S Diesel (2017), Audi R8 V10 Plus (2016), Mini JCW (2015)


    Re: Porsche pockets $17,250 on every car

    We will be in Abu Dhabi in a few weeks and planning to go to the Ferrari amusement park smiley


    Re: Porsche pockets $17,250 on every car

    SciFrog:

    We will be in Abu Dhabi in a few weeks and planning to go to the Ferrari amusement park smiley

    Smiley


    --

    RC (Germany) - Rennteam Editor Porsche 991 Carrera 4 GTS Cabriolet (2015), Porsche Cayenne S Diesel (2017), Audi R8 V10 Plus (2016), Mini JCW (2015)


     
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