Friday 24th April

Porsche sells up to give Rimac control of Bugatti

End of an era as Porsche unloads minority stake to new investors, leaving Mate Rimac, 38, to lead Bugatti alone

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How different the world looked as recently as 2021. That was when Porsche and Rimac Group established Bugatti Rimac, with all parties hoping to benefit from each other in making the hypercars of the future. By 2023, there was the Mission X concept, a 1,500hp vision of what a new Porsche 918 Spyder could be. All seemed to be moving in the desired direction, right until it wasn’t: Mate Rimac suggested that his eponymous company wouldn’t make another EV, an all-new V16 was designed for Bugatti by Cosworth, and Porsche was reeling from diminished electric demand. So much so, it turns out, that it has now sold its entire stake in the Rimac venture, with the paperwork signed today. 

It’s been on the cards for a little while, with rumours beginning to circulate last year that Mate Rimac wanted to buy Porsche out of their shares to leverage more control over the company. Doubtless the deal became a lot more appealing to Porsche off the back of its financial results. Because let’s not forget just how invested Stuttgart was in Rimac: the 2021 deal saw Porsche acquire 45 per cent of the then-newly-formed Bugatti Rimac, alongside 20.6 per cent of the parent Rimac Group.

While the amount of money involved in the transaction hasn't been published, Porsche has fully divested its equity stakes to a consortium led by HOF Capital. Michael Leiters, Porsche's CEO, has suggested that the sale will allow the company to “focus on the core business”. Which at the moment is surely about making combustion-powered sports cars. He added: “As an early-stage investor of Rimac Group, Porsche made a significant contribution to developing Rimac Technology into an established Tier-1 automotive technology company… We would like to thank Mate Rimac and his team for the constructive and trusting cooperation over the past years.”

In broader historical terms, the deal is significant as it sees the end of VW's involvement in Bugatti, for the first time since it bought the company back in 1998. What a journey it’s been since then, from slightly strange motor show concepts at the end of the 20th century to Bugatti’s return as maker of some of the fastest, most valuable, and most desirable cars on the planet. None of that would've happened without VW's expertise and input, and certainly not without Ferdinand Karl Piëch either.

A Bugatti seperated from its parent company feels like a big step, though in truth the brand as operated as seperate entity for most of its existence, and is already fused at the hip with Rimac in terms of future product. On the strength of the Tourbillon - not to mention Mate Rimac's insistence that petrol engines will remain a core part of its identity - the futue of the venerable firm could hardly be in safer hands. 

The main man said of the deal: “Porsche has been a crucial partner, and we are deeply grateful for their role in establishing Bugatti Rimac. With the strong foundations their support has provided, we now have a structure that allows us to execute even faster on our long-term vision.” Completion of the deal is expected before the end of this year, leaving HOF Capital as the largest shareholder of Rimac Group alongside Mate Rimac. Given the extraordinary progress made by his company in recent years, don’t be surprised if there’s another seismic Rimac announcement in the near future.    

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• Bugatti F. K. P. Hommage is 1,600hp one-off Veyron
• Rimac unveils Nevera R R Founder’s Edition

[Geoffcapes]

I hope RIMAC has deep pockets, as I thought VW/Porsche had bankrolled all of the Bugatti's made.

And in doing so, at a loss.

[WilsonWilson]

Seems like bad news, at least in the medium term, for all parties:

Bugatti lose OEM vanity project status so need to be delivering like any other business
Rimac no longer have link with established legacy manufacturer
Porsche (VW) lose link to company pushing limits of electrification and a brand they've poured billions into

[PistonTim]

No more Audi A3 airbags in a Chiron successor then?

[FlukePlay]

Quite amazing how a 38 year old petrolhead has acquired Bugatti...hopefully a fantastic piece of business and may the brand continue producing excellent cars.

38!

[_Rodders_]

So if they sell around 100 cars a year at say an average for £5m a pop.

Is £500m enough for Bugatti to prosper? Doesn't feel like a lot of money. Or is that way too simplistic.

[Dave Hedgehog]

Geoffcapes said:

I hope RIMAC has deep pockets, as I thought VW/Porsche had bankrolled all of the Bugatti's made.

And in doing so, at a loss.

if they cant make money a 5 mill a pop they need to give up


We may find out now if it was Mate that blocked Mat or someone at Porsche

[Noe]

The whiff of tvr debacle but on a more luxurious scale

[Puddenchucker]

Hopefully Rimac/Bugatti can be successful & survive in the same way Pagani and Koenigsegg apparently do.

[redrabbit]

Is that EB badge on straight?

[Baddie]

Rimac has thrived despite selling hardly any Neveras. Their business can’t just be selling cars, they supply legacy makers with electrical components too. GMA have also been able to sell small volumes of expensive cars without that line of business so it may not be bad news. But £500 million can’t be near enough to develop Veyron / Chiron grade cars.

[timc55]

PistonTim said:

No more Audi A3 airbags in a Chiron successor then?

[Dombilano]

Mat Armstrong is 100% getting Bugatti help from now on with Porsche gone

[WPA]

Dombilano said:

Mat Armstrong is 100% getting Bugatti help from now on with Porsche gone

No chance even with Porsche gone, he has burnt all those bridges with his arrogance

[Wab1974uk]

Can't help but feel this will end badly in a few years.

[Clad-Hach]

If it gets into trouble Bugatti will head into Chinese hands as they have deeper pockets than VW / Porsche.

[Cristio Nasser]

This doesn’t feel like good news at all. Not having the parts bin support, engineering, and facilities might that a massive automotive conglomerate like VAG offers, and to go it alone is a devastating loss.

Things must be much worse at Porsche (and by extension VAG) than we’re being led to believe if they’re having to sell off the Crown Jewels. Lambo, Bentley next?

[RacerMike]

_Rodders_ said:

So if they sell around 100 cars a year at say an average for £5m a pop.

Is £500m enough for Bugatti to prosper? Doesn't feel like a lot of money. Or is that way too simplistic.

Given that it's at least a billion Euro's to get a new platform to production, no!

[Robertb]

Cristio Nasser said:

This doesn t feel like good news at all. Not having the parts bin support, engineering, and facilities might that a massive automotive conglomerate like VAG offers, and to go it alone is a devastating loss.

Things must be much worse at Porsche (and by extension VAG) than we re being led to believe if they re having to sell off the Crown Jewels. Lambo, Bentley next?

I'm speculating, but I presume there are some platform and parts sharing agreements in place, not least because Rimac Technology EV kit will be used elsewhere in the VAG/Porsche range.

We need SSO's take on this, hopefully he will comment via his blog.

Edited by Robertb on Friday 24th April 14:55

[nismo48]

Good luck Mate

[Digger]

Sorry, but please run a spellcheck on the 5th paragraph.

As you were.