RE: Preuninger: Porsche is not a hedge fund

[Jamie Summers]

TooMany2cvs said:

Jamie Summers said:

Just a thought, and before I'm shot down in flames, I don't know enough about Porsche's production facilities.......

But..... Porsche are now approaching "volume" production status, thus the niche models need to be fitted into production schedules for the "cooking" models. Presumably the margins a better on the volume cars (?) - certainly some niche models have historically been loss-leaders. Thus Porsche could certainly produce the niche models in greater numbers but it might be at the expense of the higher volume models with an attendant negative impact on profitability.

Keeping production numbers low on the niche models has the perceived added bonus of protecting / enhancing brand value, but ultimately the decision on production number may come down to cold, hard, profitability considerations more than anything more Machiavelian.

I'm completely willing to be told otherwise, but it sounds plausible to me.........

Except for one minor detail. The volume Porsches are not built in Stuttgart. The Mac and Panawka are built in Leipzig, the Cayenne's built by VW in Bratislava then finished in Leipzig. Boxsters and Caymans are built by VW in Osnabruck as well as Stuttgart, now they're no longer built by Valmet in Finland.

If they built more 911Rs, or the like, it'd probably be roughly the same overall 911 production figures.

See, told you I didn't know much about Porsche's production facilities

However I clearly remember Porsche explaining that the GT4 was not a limited production model per se, but its numbers were constrained by the production slots available. Given it was a run-out model they could not continue production into a new model year, so I don't think my argument is entirely without merit.

The bottom line is that it suits Porsche to keep the numbers low, which means they probably don't try very hard to make the production slots available.

[corozin]

If Preuniger and Porsche both wanted Porsches to be driving cars and not investment vehicles then they'd stop sodding around limiting the numbers of all these special models they are churning out and build enough to meet demand.

So basically the whole piece is "we're trying to pretend we're sorry about it even though really we're not" isn't it?

[n17ves]

anonymous said:

[redacted]

True, neither of us can prove our positions on here.

To be honest I'm quite intrigued with the 991.2 GT3, not just that I have a vested interest, but to see if the flipping has calmed down somewhat. I'd like to think it will, but I think money talks and some will be succumbed when the overs carrot is dangled. Hopefully it will be lessened though with what OPC's have learnt and the pressures Porsche UK have placed on them.

[n17ves]

corozin said:

If Preuniger and Porsche both wanted Porsches to be driving cars and not investment vehicles then they'd stop sodding around limiting the numbers of all these special models they are churning out and build enough to meet demand.

Maybe Ferrari should lower their prices and increase production in a bid to become a volume manufacturer so the real drivers amongst us can enjoy the thrill of driving one - Id love to have a 458 speciale for 991 money for example

[tuffer]

PhantomPH said:

BigDave3243 said:

Roma101 said:

BigDave3243 said:

Wa wa wa, the big bad Porsche men won't let me buy their car. Wa wa wa. I'll just have to console myself by spending my £140k on something else and then b***h about it on the internet.

Dry your eyes ladies.

Because maybe people want to buy a 911R and can't and are a little frustrated. I agree some people take this a little to much to heart, but it's not rocket science.

We all want a lot of things but being a cry baby on the internet isn't really the answer. I have zero sympathy.

People are pissed off because they wanted an R so they could benefit from the double/triple value hike...and anyone who says otherwise is talking bks, IMHO. "Oh, I just wanted to buy that R and put thousands of miles on it and track it and to hell with the value....". Aye, whatever. You are just pissed off because you wanted to be quids in to the tune of £300k.

And who wouldn't be?? Pretty sure I would stomach the finance payments for a few months, if I then trousered £300k....

Edited by PhantomPH on Monday 13th February 17:14

Actually I was not that interested in a R, I would rather have a GT3 or even better an RS. Absolutely no intent to flip it, I just want one to drive. If at a later date they bought out a newer version and I could trade up to it that is what I would do, if I lost money in the process I would be fine with that.

[PhantomPH]

tuffer said:

Actually I was not that interested in a R, I would rather have a GT3 or even better an RS. Absolutely no intent to flip it, I just want one to drive. If at a later date they bought out a newer version and I could trade up to it that is what I would do, if I lost money in the process I would be fine with that.

I said 'most' - you're the exception. (gorgeous 991, btw)

I love cars as much as anyone, but really they are just plastic and metal. No matter what my financial position, if someone offered me a £300k bump on a car I'd paid £150k for a few months earlier - unless it was my dreamiest thing of all time ever - I'd hand them the V5 without hesitation.

[Roma101]

BigDave3243 said:

Roma101 said:

BigDave3243 said:

Wa wa wa, the big bad Porsche men won't let me buy their car. Wa wa wa. I'll just have to console myself by spending my £140k on something else and then b***h about it on the internet.

Dry your eyes ladies.

Because maybe people want to buy a 911R and can't and are a little frustrated. I agree some people take this a little to much to heart, but it's not rocket science.

We all want a lot of things but being a cry baby on the internet isn't really the answer. I have zero sympathy.

Being cry babies is a bit harsh. People venting their frustration is a more balanced view. Live and let live. If you are not one of those affected by Porsches' sales tactics, why post a deliberately antagonistic post?

[Roma101]

n17ves said:

Davey S2 said:

n17ves said:

marcosgt said:

Then why, Herr Preuninger, do you insist on building limited run specials?

To protect brand exclusivity, exactly the reason why Ferrari decided a few years ago to reduce production numbers! The difference with Porsche is that the he customer base is broad, they are selling 918's to compete with the P1 and La Ferrari, but then they are also selling 718's and Cayennes to compete with Z4's and X5's. This diverse range of cars seems to confuse the market and portray Porsche as a volume brand where supply should always meet demand, which it isn't.

Similar story with Aston Martin, the GT8 sold out pretty quick. Furthermore, they are now selling for grossly more than the overs commanded on the GT4, GT3 and GT3 RS! Despite this, you don't see threads complaining about the 2nd hand prices and the 'supposedly' underhand deals made by the dealers. Its seems to be accepted that this is okay for Aston to preserve Brand exclusivity and limit production, but not for Porsche!

I for one am gutted that I wont be able to buy a 991 R at list, but Im more than happy to accept that I wont be seeing a "OMG I've just bought a 991 R..." vlog anytime soon either.

The difference is anyone could order a GT8 whether they had history with AM or not.

No, its exactly the same! Anyone can ring up and put their name down for a GT2, GT3, GT4, RS etc, the difference is they are reluctant to sell to any random person off the street that, quite probably, has read PH and will just flip for a quick buck. Same goes for the those that buy several Porsches a year, that are unlikely to keep the car longer than 6 months, and will cause contention amongst the brand when sell a car over list whilst still in production.

Porsche cant control second have values, but they will try to preserve the brand and sell to the people that aren't just caught up in the overs. Same goes for Aston and any other marque that maybe selling a rare car that's in high demand. I just don't think its fair Porsche get so much stick for it.

Edited by n17ves on Monday 13th February 16:38

So it is ok for Porsche to pre-judge prospective new customers who genuinely might want to buy a GT car just to protect their brand? I can see why people get frustrated by that level of snobbishness.

[Niffty951]

I'm so pleased to hear Porsche's management thinking on this. Did no one learn from the 80's?

I used to love driving Porsche cars because, they were the best driving experience for any price point. They felt at home on a track, were built to take being driven hard day in, day out and fellow owners always seemed to be like minded.

We all know the bubble will crash again leaving only a select few models on the pedestal, it is the inevitable cycle of life but I'm worried that by the time used Porsche values come crashing back to reality the roads will no longer be friendly, or I'll be too old to enjoy the driving experience. I'm already getting grumbly about harsh suspension in german cars.

[GrizzlyBear]

SFO said:

Preuninger works for Porsche

All of his utterances will have been cleared in advance by Porsche Corporate Communications.

Exactly, basically this is free advertising, and here we are discussing it, so Preuninger is just doing his job.

[ukaskew]

n17ves said:

To protect brand exclusivity

That makes no sense, they're churning out hundreds of thousands of cars per year, many of which look broadly the same to the untrained eye. You don't protect brand exclusivity by building a limited run car that is essentially only different mechanically to various other models you might see in the high street every day.

The only thing they seem to be doing is making a very select few customers very wealthy, and pissing off everyone else.

[Crazy4557]

I've owned 19 911's over the years, some being new and I for one will never buy another from them, not because I'm feeling betrayed either. Who on earth wants to have to practically beg them to sell you one otherwise you have to pay some over blown premium?
I buy them to drive them not polish them or wonder how much I've made, I run a business to do make money and drive nice cars for enjoyment.

[Mario149]

tuffer said:

PhantomPH said:

BigDave3243 said:

Roma101 said:

BigDave3243 said:

Wa wa wa, the big bad Porsche men won't let me buy their car. Wa wa wa. I'll just have to console myself by spending my £140k on something else and then b***h about it on the internet.

Dry your eyes ladies.

Because maybe people want to buy a 911R and can't and are a little frustrated. I agree some people take this a little to much to heart, but it's not rocket science.

We all want a lot of things but being a cry baby on the internet isn't really the answer. I have zero sympathy.

People are pissed off because they wanted an R so they could benefit from the double/triple value hike...and anyone who says otherwise is talking bks, IMHO. "Oh, I just wanted to buy that R and put thousands of miles on it and track it and to hell with the value....". Aye, whatever. You are just pissed off because you wanted to be quids in to the tune of £300k.

And who wouldn't be?? Pretty sure I would stomach the finance payments for a few months, if I then trousered £300k....

Edited by PhantomPH on Monday 13th February 17:14

Actually I was not that interested in a R, I would rather have a GT3 or even better an RS. Absolutely no intent to flip it, I just want one to drive. If at a later date they bought out a newer version and I could trade up to it that is what I would do, if I lost money in the process I would be fine with that.

Ironically it's the other way for me. Had a 997 GT3 but sold it because it was a faff on the road. A 911R would be right up my street and would mean I wouldn't have to run a sportscar for the road and a track car at the same time, much as I love them both.

In hindsight of course what I should have done was keep my 7GT3 and just fit an RS or Cup final drive, de-spoiler it, put some standard rather than Carrera GT buckets in it, and possibly fit some softer springs or maybe PSS10s. Probably £10K all in for those tweaks creating a 997 R in all but name, and completely reversible. Oh well.

[gm77]

Really don't understand the hedge fund reference. As someone who works with hedge funds it makes no sense.

Basically, Porsche is a business, and a very good one. It has high brand value and uses that to maximise profits. Given the majority of dealerships are owned by Porsche rather than independent franchises (unlike any other car brand in the world) and that the majority of flipping is through dealerships, you've got to pay them on the back for what they're doing as a business. If you think about it, produce a an excellent car is smallish numbers, attach a largely unrealistically low list price to it, spend a fortune in marketing it, the reviews are amazing, everyone wants one, and owned dealerships used trusted owners to flip the cars to obtain the trust value on the second sale of the car through that owned dealer.

A friend had a 991 GT3. He wanted a 991GT3 RS. The dealership said he could have the RS on condition he part exchanged the GT3 which they would only offer at his original purchase price. Dealership then makes a massive profit on the second sale of his GT3, and also ties him in on the RS.

As someone who works in business I'm in total awe of the business model - it's truly genius. As a car fan, I can't be bothered with it. For the true price you have to pay for the GT cars there are better alternatives. A £90k second hand GT4, or a brand new Exige Sport 380? A second hand 991 GT3 RS, or a brand news McLaren 650S?

[Guybrush]

He's giving out some BS. He knows damn well how to create a large demand for a particular model and thus a premium price later - low numbers, lightweight, etc etc - the classic 911 formula. Oh what a surprise, there's a massive demand over supply. Just create such a car in larger numbers. Sorted.

[p1stonhead]

God is a 997.2 RS really £200k these days?

Am I dreaming or were they £75k at one point?

[TooMany2cvs]

anonymous said:

[redacted]

That was how I read it, too.

anonymous said:

[redacted]

Yes... right up until the point that you remember that the creation of this market is deliberate, cynical and ENTIRELY under Porsche's control.

[tuffer]

gm77 said:

A friend had a 991 GT3. He wanted a 991GT3 RS. The dealership said he could have the RS on condition he part exchanged the GT3 which they would only offer at his original purchase price. Dealership then makes a massive profit on the second sale of his GT3, and also ties him in on the RS.

I understand your point and totally agree but I would also be extremely happy if I was in the position that your friend had, I would take that deal all day long.

[smilo996]

Talk about contradicting himself.

So we cannot offer cars with a built-in promise to keep value for a small amount of chosen people, this wouldn't be fair."

"The R will stand on its pedestal for ever, as with the 997 GT3 RS 4.0," he says. "With that car it didn't hurt that there was a 991 GT3, it didn't hurt that there was a 991 RS, it didn't hurt that there was an R with a manual gearbox - RS 4.0 values are sky high. It is the same with the R."

Just the attitude for that certain type of Porsche owner.

[Yipper]

Porsche profits handsomely from the "Le Mans factor". Powerful PH-director types get excited about medallion-men driving round in the dark at high speed, and then rifle through Autotrader to bid up the resale price of a Beetle with a bit of scaffolding in the back. Other carmakers are cottoning on to this and starting to copy their racing-led marketing, like Audi and Jaguar.