Will Porsche do themselves in?

Originally Posted by Brucelee

As Elmer Fudd would say, "be very quite, I'm hunting rabbits!

Not exactly...I think he said..."I'm hunting wabbits"!!!

[Brucelee]

Originally Posted by bmussatti

Not exactly...I think he said..."I'm hunting wabbits"!!!

Actually you are correct!

Good one!

[Rail26]

I too, agree that Porsche does care about exclusivity. That is why they have not introduced the "Wagon S"!

[MNBoxster]

Hi,

OK, maybe you're right, I may have misstated Porsche's concern for exclusivity, but to what degree?

The allure of Unit Sales, Expanded Markets and Profits is a strong one, and never more strong than to a Company which is tasting Strong Profits for the 1st time in a long time.

Porsche introduced the Boxster and 914 amidst cries of discontent from the Faithful, even the Cayman will have a dilutive effect on the Flagship 911's sales. With all the Cars they've been selling the past few years, they must be concerned about saturation. If so, what to do? Expanding into new Markets seems to be the most prudent thing to do, and there's much more of a Market moving to Center than away from it.

I'm not even sure that this is a Bad Thing, except for those who want to remain Exclusive. Frankly, I don't comprehend this, I don't feel the least bit exclusive owning a Porsche. It's a very nice Car, but after all, it is just a Car.

Unfortunately, Public Ownership of Companies brings with it an unfortunate necessity, namely posting positive numbers every quarter. Gone are the days when a small group of Owners or an Entrepreneur will take a longterm view and choose to forego Profit in the short term. Add to this that most Senior Managers and Directors Incentives are based more on the Stock Price of a Company. This can cloud their judgement, we've seen this time and again in recent years. They certainly are acting this way with respect to some of the Quality issues which have plagued the Company for the past 5+ years - Major Quality issues, No Recalls, Preserve Profit... to Hell with the Owners.

Porsche is now a very large company and so one should expect that they'll act the part. This means, that the Bygone days are just that - gone. Of course, this is all speculation, but, it will be interesting to see in which direction they actually head...

Happy Motoring!... Jim'99

[limoncello]

Porsche has done OK lately, I think their CEO was named Automobile mags man of the year for taking a Porsche, that was in the red, and turning it into one of the most profitable makers around. Somebody did something really right by bringing in the Boxster/Carrera co-design, the Cayenne, etc. It HAS worked.
The future? Four door sedans? I'm not so sure. They are seemingly adding a lot to the mix at one time. Hope it works -

[jamscal]

Don't forget also that the 'new' Sedan will feature Cayenne mechanicals.

Exclusivity?

I'm used to seeing 50 C5 vettes before I see another Boxster, and then yesterday I pass two Boxster S s and then a regular one on my way to work. Kinda neat.

-James
'01 S

[MNBoxster]

Originally Posted by limoncello

Porsche has done OK lately, I think their CEO was named Automobile mags man of the year for taking a Porsche, that was in the red, and turning it into one of the most profitable makers around. Somebody did something really right by bringing in the Boxster/Carrera co-design, the Cayenne, etc. It HAS worked.
The future? Four door sedans? I'm not so sure. They are seemingly adding a lot to the mix at one time. Hope it works -

Hi,

All good points! One thing which has not been mentioned is the impact the Cayenne has had. It has contributed much more to Porsche's Sales Numbers and Profitability than the Boxster has, which has shown some declining sales of late.

This means that Porsche has gained momentum from exactly what I am saying, New Markets. The Cayenne created a whole new segment of Porsche Customers who would most likely have become Owners of MB, Lexus and Accura had they not had a Porsche to choose from - they were not likely to buy a Boxster or 911 instead.

The Cayenne is almost solely responsible for Porsche's turnaround, this very fact is even cited in one of their recent Annual Reports.

In other words, Porsche became Profitable by designing and producing something other than a Sports Car. I suspect that this lit more than a few Lightbulbs in the Minds of Porsche's Directors.

I'm not saying that Porsche will ever turn it's back to the Sports Car Market, just that there is a strong incentive to move in other directions as well, and at the same time...

Happy Motoring!... Jim'99

[Perfectlap]

THe funny thing is that by building so many Cayennes they have killed two birds with one stone: they've majorly increased revenues(40% of sales that were non-existent pre-Cayenne) which makes the 911 more 'exclusive' or uncommmon relative to their overall production.
Where as in the past the 911 was the car they sold the most of, its now fewer in numbers than the 1-2 punch of the Cayenne and Boxsters.

Kind of brilliant when you think about it.


But I think that they may want to take a hard look at being so reliant on the Cayenne. Nearly half of all sales on SUV's is not a plan for the future. The $3 a gallon future is going to affect this segment of the auto industry, whether that will be a concern at all for someone spending such a large sum on an SUV of all things, is a seperate matter.
Building HIGH end/low volume Sedans like Merc is a better strategy than going after the low cost/high volume "sporster" route. A better way of bringing more revenue while preserving the prestiege of the "there is no substitute" brand image. Porsche can really capitalize on the 'perceived' advantage that a Porsche will always out-handle, out-corner, out-brake any car made by BMW or Merc. A Porsche sedan will make a Merc or BMW sedan seem old school by comparison.
KInda like lining up a Maserati Quatroporte next to an S class. I know which I would rather take for a day trip with 3 passengers.

[BoxsterSbob]

Hi, it seems like the bottom line is Porsche wants to sell more units. They all want to sell more units! I want to sell more units and I don't make cars! This isn't a bad thing as long as the quality and feel that Porsche markets stays within the tolerances of the folks that consume them. Some might argue that quality has been a bit iffy at times (RMS). But, they're moving more metal than ever.

History suggests that if they misfire a few times on products it won't be the end of the (Porsche) world.

There is a chance that VW involvement might give P-management the expansion and reach they appear to be "jonesing" for. Or, this could all be defensive and aimed at avoiding a take-over by a larger firm/competitor?

Whatever the case maybe, I'm sure that the P-management team has gotten very accustomed to that high valuation, and the bonus that it generates. They'll do what they need to do to preserve it.

I, and I'm sure all of us, wish them continued success.



04S
bob

[gRed04]

Originally Posted by MNBoxster

I'm not even sure that this is a Bad Thing, except for those who want to remain Exclusive. Frankly, I don't comprehend this, I don't feel the least bit exclusive owning a Porsche. It's a very nice Car, but after all, it is just a Car.

I think people purchase things out of necessity and out of desire. Desire plays a part even in necessity purchases but is maybe not as much a factor as function. Wanting to have something “special” is almost ingrained into American society. No one buys a Porsche out of necessity.

While you may not have chosen to own a Porsche for exclusivity you are part of a exclusive group of Porsche owners simply due to the fact of the number of this type of vehicle on the American highways and the price you must pay to be part of that group. Understanding that the expense of acquiring this type of vehicle is entirely relative.

I’m sure there are Pcar owners that buy the vehicle strictly because of the “cost” status symbol it represents, while others may be in the “performance” status camp. However, I would think we all categorically fall into one or the other ( or possibly both ).

[longislander1]

I think Porsche is diluting its cars to increase sales in the mass market as the (lower-priced) competition creeps closer and closer in performance. Cars in general are getting so good -- and so fast -- that the day will come soon where you won't have to pay Porsche prices to get Porsche performance.

[MNBoxster]

Originally Posted by longislander1

I think Porsche is diluting its cars to increase sales in the mass market as the (lower-priced) competition creeps closer and closer in performance. Cars in general are getting so good -- and so fast -- that the day will come soon where you won't have to pay Porsche prices to get Porsche performance.

Hi,

Excellent Point !! Increasingly, there is less Exclusivity with respect to Performance. This is Not something Porsche can choose to ignore...

Happy Motoring!... Jim'99

[BoxsterSbob]

That maybe true. But, it their job to make sure that Porsche sports cars meet customers expectations. To-date they have. I believe they'll continue to do so. You may have to work your way past sedans, stationwagons and minivans in the show room to get to them-but they'll be there. And, they'll be great, and expensive as always.

04S
bob

[Perfectlap]

Originally Posted by longislander1

I think Porsche is diluting its cars to increase sales in the mass market as the (lower-priced) competition creeps closer and closer in performance. Cars in general are getting so good -- and so fast -- that the day will come soon where you won't have to pay Porsche prices to get Porsche performance.

I think we are there already. The s2000 is much cheaper than the Boxster and the performance difference doesn't reflect the big difference in price.
Allot of guys I know who don't care what brand makes the car thought it was a no brainer and opted for the nimble S2000 without hesitation.

If you can already get Boxster performance at a much lower cost then obviously there are other facotrs driving demmand. And I agree, further 'diluting' the cars will backfire. The 2.7 is as small an engine as they should ever go, perhaps coupling that with a Lotus Elise type-bare bones ultra light weight targa top Porsche could be a good move. But a low cost version of the boxster with even less power would be a not good move in my opinion. Porsche has tremendous credibility from their LeMans achievements, they really need to be careful about that reputation for racing that they have established over 50 years.