What does a new 911 cost the OPC? (Impact of Brexit Tariffs)

[churchie2856]

A new Porsche 911 costs £83,000 on the road, this made up of:

The cost of Car
Import tariff (currently 0%)
Dealer’s Cut/Margin/Profit/Whatever
VAT (@20%)
Road Tax (say approx £1200)

If there is a no-deal Brexit, a 10% import tariff is applied to the Car only, but not also to the Dealer’s Cut or the Road Tax. Thus the on the road price post no-deal would not be 10% more. Depending upon the size of the Dealers Cut + Road Tax (which do not change even with the introduction of a 10% tariff) in relation to the cost of the Car, the increase to the on the road cost would be lower than e.g. 8%.

Example - No Tarif

Car £58,167 (guess)
Tariff 0% £0
Dealer £10000
VAT £13633.33
VED £1200
OnTheRoad £83,000

Example - 10% Import Tarif

Car 58,167 (no change)
Tariff 10% £5816.66
Dealer £10000 (no change - its the same effort to sell regardless of import duty)
VAT £14796.66
VED £1200 (no change)
OnTheRoad £89,980

Price Inc £6,980
% Inc 8.4%


So why are OPCs suggesting and making people commit to paying 10% more?
What does a new 911 cost the dealership to buy anyway?

[Twinfan]

It's probably to simplify the maths, make a direct link to the import charge, and make a little more profit. Simple and easy to understand for most people.

I doubt you'll find out what the OPC pays for each car from Porsche Cars GB.

[Nuttcase]

The assumption that the dealer margin will remain a fixed quantity in £ is hardly valid. Do you think the margin on a 918 was £10k? The dealers will expect the same % margin as before, unless sales are significantly adversely affected, then they may come to the table in the form of dealer discounts.

Edit : on reflection I think you have a point though. Hypothetically if sales remained the same, then the dealers would make more profit as the 10% hike is applied to their margin.

Edited by Nuttcase on Wednesday 2nd December 10:51

[Monch]

Essentially, dumbing it down, my understanding is.

Dealers have a 8% margin with a further 5% added for hitting further targets, no of sales, customer service etc (which is why they always insist your score them 10/10 on the surveys they send out)

so ignoring VAT and road fund, because that is added after.

a car that is £50,000 net of tax earns a dealer a possible 13%.
The dealer pays this to PGB at 90 days.
Which is why they sometimes discount new stock cars as 90 days approach.

Porsche GB import the car into the UK at a price which will obviously see them a profit. I have no idea how that works in terms of %s or £s

It is my understanding the possible 10% charge will calculated at the price PGB pays for the car.

% profits will be added to this in the normal way all the way through to us buying the cars.

Car prices are set by PGB.

Internal price changes may also happen too, that's normal.

I would love someone in the know to give a full detailed breakdown.....


edit. maybe 9% & 4%

Edited by Monch on Wednesday 2nd December 19:39

[DMZ]

I don't think Porsche passed on all of the mahoosive fall in sterling in the last few years so the pricing is presumably partially what the market will bear much like any other pricing. If the cars become 10% more expensive to import (on top of the 30-40% or so that they have had to deal with in the last couple of years), I guess they have another pricing decision to make in order to balance margin with market share/volume. I'm sure they have plenty of margin to play with seeing as they are one of the most profitable brands out there. It may also be that there will be a free trade deal and none of this will come to pass and sterling might even recover if so.

[Grantstown]

I have a freeze date for spec of the 12th Jan for a Taycan. Presumably the price will also be locked down then? There has been no mention of 10% from the OPC.

[av185]

OPC can vary the price at anytime they wish as per the conditions of sale which covers the now increasing likelihood of a no deal Brexit surcharge.

[anonymous-user]

I would doubt if Porsche GB make a profit on the car as inflating the price of the car, etc from Germany is a way of transferring money back to the parent company so the profit is declared in Germany not the UK.

I wouldn't be surprised if Porsche GB actually runs at a loss.

[EvoSid]

gottans said:

I would doubt if Porsche GB make a profit on the car as inflating the price of the car, etc from Germany is a way of transferring money back to the parent company so the profit is declared in Germany not the UK.

I wouldn't be surprised if Porsche GB actually runs at a loss.

Are you serious ?

This is from an article in Autocar . ok not directly linked to POrsche GB but they will be in similar situation

Porsche’s 2019 profit margin was 15.4%, the highest in the automotive world. Although other carmakers earned more money outright in 2019, nobody can beat the Stuttgart brand’s return rate on its products.


Porsche Cars Great Britain recorded a profit of £24 Million plus for year ended 2019 (after tax), up form £3 Million in 2018 . So no chance of a loss there I think

Edited by EvoSid on Wednesday 2nd December 19:22

Edited by EvoSid on Wednesday 2nd December 19:38

[anonymous-user]

Well I have seen multi-national companies do exactly this, if Porsche don't then they don't.

[anonymous-user]

gottans said:

Well I have seen multi-national companies do exactly this, if Porsche don't then they don't.

German corp tax %~30-33% ?

Uk 19%

Basic transfer pricing. Surely you’d want to take the profit in the UK as far as possible rather than Germany?