RE: Prior Convictions: Pondering the Porsche Passport
Friday 13th October 2017
It's not for everyone, is the thing, I suppose. The Porsche Passport has been launched in the US, and it's curious. For some it will be an entirely compelling way to have a car. But does it represent the beginning of a step change in the way we own, or use, cars? This, as yet, I'm not so sure about.
One set of weekend wheels...In case you missed it, the premise is simple enough. You're leasing a car. In this case it's a Porsche, but you don't have to have it all the time if you don't want to; and you can swap willy nilly between certain Porsches.
... can be swapped very easily. Simple, right?But also I can see you wouldn't because, well, it depends how you like enjoying your cars. Routinely swapping cars - as I have discovered - is a brilliant way to lose phone chargers and Haribos. And if you enjoy the ownership experience, if you love it and cherish and nurture your car it's a like a pet. Then, well, it'd be like timesharing your cat. How could you? Look at his little face. But people do buy, sell, borrow, and share horses, I suppose. They find an outcome that meets their income.
But what if you get attached?Would, though, the scheme soften residual values? That, I suppose, is a risk. Or a benefit, depending on who you are. But car more sales, more dealer stock, more profit: you can see what's in it for Porsche.
Prior Convictions: Pondering the Porsche Passport
Are manufacturer subscriptions how we'll access cars in the future? Matt P isn't so sure...
One set of weekend wheels...
There are two tiers - the more you pay, the more expensive the cars you have access to. So it's somewhere between a conventional lease deal and a car club.
What's in it for you, then? Well, it depends who you are. If it's for you, I guess you'll know it. You can have a car that suits your needs, when it suits your needs. If you live in town, are short of parking space and they charge you a fortune for a parking permit, it's ideal. You can still have a practical car and a sports car, which could be beyond you otherwise. Only one at a time, but it's not like you can drive two cars at once anyway. I can see why you would.
Then, I can see why you wouldn't. Not just because, presumably, there won't be a 718 Cayman for everyone and a driver to swap them all at the same time; so if you all want one at once, on a Friday afternoon before a bank holiday, you might be out of luck. I suppose we'll find out how that goes, though.
... can be swapped very easily. Simple, right?
So what's in it for Porsche? For one it's broadening its appeal: there will be those who won't buy a Porsche who'll sign up for this. But even where Porsche is talking to people it already knows, there are advantages.
Demand for used cars is, generally, higher than it is for new cars, and even though Porsche doesn't suffer from oversupply like mainstream car makers, I suspect it'll quite like to have a decent supply of used stock. Mainstream car makers find myriad and devious ways of getting new cars quickly onto the used market - massive fleet discounts, pre-registration, giving dealers big bonuses to find cars homes - which isn't an option easily open to a premium brand.
But what if you get attached?
So why might this not be the start of something revolutionary within the industry? I don't doubt car sharing will increase, but it won't be like this. Why not? Because they can't do it. Some car makers don't have a big enough range, some others aren't appealing enough, and profit margins are too small to lay on what is a personnel-heavy scheme. Do you fancy swapping the Jazz for a CR-V this weekend, darling? Frankly, dear, I don't give a monkey's.
So it's not for everyone. That much is true for potential buyers. But, I suspect, it's even truer for manufacturers.
Discussion
I see it as the natural extension of their driving experience days. I also understand Volvo are going to do something similar with the XC40, which allows temporary access to a bigger Volvo (with certain rules).
It seems like a great idea as you can have the right car for the right occasion - 718 for normal use & a Macan for the once in blue moon when you need a 5 seater or the other way round.
Do you get a car 365 days a year with this scheme? And do other customers get to drive "your car" (the one you usually have in your care) whilst you're off in a 718?
If this expands to the UK just be careful of an one owner ex-Porsche UK car.
It seems like a great idea as you can have the right car for the right occasion - 718 for normal use & a Macan for the once in blue moon when you need a 5 seater or the other way round.
Do you get a car 365 days a year with this scheme? And do other customers get to drive "your car" (the one you usually have in your care) whilst you're off in a 718?
If this expands to the UK just be careful of an one owner ex-Porsche UK car.
If I was looking for a user Porsche I'd be doing everything I could to avoid one that has come from this scheme, so am not sure it is the answer to used stock.
Even at a year old the car could have had a hundred drivers ragging it from cold etc. and the model of car "buying" makes me think drivers will treat the cars much less well than a one owner private owned car.
Even at a year old the car could have had a hundred drivers ragging it from cold etc. and the model of car "buying" makes me think drivers will treat the cars much less well than a one owner private owned car.
At $2000 per month you are just buying/leasing two or three cars anyway, I can see the appeal though if you have money to burn, a Porsche fetish and only own a home with one parking space.
Could be a bit irritating working out what options have been fitted to the Cayman that has been delivered for this weekend.
Could be a bit irritating working out what options have been fitted to the Cayman that has been delivered for this weekend.
Edited by Toltec on Friday 13th October 16:25
Scottie - NW said:
If I was looking for a user Porsche I'd be doing everything I could to avoid one that has come from this scheme, so am not sure it is the answer to used stock.
Even at a year old the car could have had a hundred drivers ragging it from cold etc. and the model of car "buying" makes me think drivers will treat the cars much less well than a one owner private owned car.
<nods> Who'd buy an ex-rental Porsche...?Even at a year old the car could have had a hundred drivers ragging it from cold etc. and the model of car "buying" makes me think drivers will treat the cars much less well than a one owner private owned car.
It's worth to remind ourselves that the subscription is not merely about access to a variety of vehicles; it's also about paying for nothing extra, apart from petrol. The OEM subscription covers everything else: registration, insurance, cleaning, maintenance, repairs, and so on.
Cadillac offers this program for a monthly fee of $1500 (£1125), in the New York City metropolitan area, and will add more US cities next year.
It's called Book and you can change your vehicle up to 18 times per year. No long-term commitment. Pay month-to-month and can cancel at any time. Cadillac claim that 8,000 customers are on a waiting list nationwide.
In the short term, such a concept is a useful accent to the traditional ways of selling and leasing vehicles. It's immersive and conducive to things like word-of-mouth and social media.
Longer term, this concept probably helps Cadillac and General Motors to get a better understanding of operational and capital requirements of the various subscription / autonomous / ride-sharing business models which are being considered for the decades ahead.
Cadillac offers this program for a monthly fee of $1500 (£1125), in the New York City metropolitan area, and will add more US cities next year.
It's called Book and you can change your vehicle up to 18 times per year. No long-term commitment. Pay month-to-month and can cancel at any time. Cadillac claim that 8,000 customers are on a waiting list nationwide.
In the short term, such a concept is a useful accent to the traditional ways of selling and leasing vehicles. It's immersive and conducive to things like word-of-mouth and social media.
Longer term, this concept probably helps Cadillac and General Motors to get a better understanding of operational and capital requirements of the various subscription / autonomous / ride-sharing business models which are being considered for the decades ahead.
It’s the way of the future so makes sense for Porsche to get in on the act. In fact Porsche are in the perfect position to offer this scheme as they can supply suv,exec barge and sports cars worth similar amounts of money to the customer who may regularly find benefits in each category.
However I suspect the uk is the worst country on earth to offer the scheme in. All the 911’s would be booked out on the four sunny weekends and bank holidays days we get each year.
However I suspect the uk is the worst country on earth to offer the scheme in. All the 911’s would be booked out on the four sunny weekends and bank holidays days we get each year.
I personally love the concept as I get bored easily with cars, so many finance options are not viable for me as they go on too long.
But, the price is steep for sure.
I wonder if this would work lower down the market? Vauxhall program at $500 a month? Kia at $300... could be very attractive if the price meets the value at some point in the mass market.
But, the price is steep for sure.
I wonder if this would work lower down the market? Vauxhall program at $500 a month? Kia at $300... could be very attractive if the price meets the value at some point in the mass market.
TooMany2cvs said:
Scottie - NW said:
If I was looking for a user Porsche I'd be doing everything I could to avoid one that has come from this scheme, so am not sure it is the answer to used stock.
Even at a year old the car could have had a hundred drivers ragging it from cold etc. and the model of car "buying" makes me think drivers will treat the cars much less well than a one owner private owned car.
<nods> Who'd buy an ex-rental Porsche...?Even at a year old the car could have had a hundred drivers ragging it from cold etc. and the model of car "buying" makes me think drivers will treat the cars much less well than a one owner private owned car.
Most of Porsches Silverstone Experience centre track cars are sold at UK OPCs at full retail money.
Hundreds of drivers ragging them round the track.
991 GT3 RS I drove the other month had 6k miles and over 2000 launch starts. I did 2 hours road driving then two and a half hours on track getting through a new set of tyres.
Car drove perfectly.
Not that I'd buy an ex track car, of course.
To me the idea is a natural extension of car leasing, ultimately the majority of new buyers don’t own their cars so the ability to hop in and out of the right car for the moment is very appealing.
I think only high end manufacturers can do this as they can charge a premium for the service (let’s face it the current offering is not affordable for most people).
Since porsche now have a car to serve every need in the range you get absolutely brand loyalty, why does a consumer need to go to another brand - “need an estate sir, we have one for you” or “need a convertible for the wedding, here you go sir”.
It’s a seriously clever way of locking in the customers with more disposable income IMO.
I think only high end manufacturers can do this as they can charge a premium for the service (let’s face it the current offering is not affordable for most people).
Since porsche now have a car to serve every need in the range you get absolutely brand loyalty, why does a consumer need to go to another brand - “need an estate sir, we have one for you” or “need a convertible for the wedding, here you go sir”.
It’s a seriously clever way of locking in the customers with more disposable income IMO.
h0b0 said:
You could lease both of these for $2350 leaving $650 for insurance when compared to the $3k plan. The Cayenne is ex-demo though but the cars in the passport deal would not be new after the first switch.
What about tax, maintenance, cleaning?Maybe not the full $650 a month but, convenience factor? Ability to just finish the program if you need to? (Maybe lose your job or something)?
ReaperCushions said:
h0b0 said:
You could lease both of these for $2350 leaving $650 for insurance when compared to the $3k plan. The Cayenne is ex-demo though but the cars in the passport deal would not be new after the first switch.
What about tax, maintenance, cleaning?Maybe not the full $650 a month but, convenience factor? Ability to just finish the program if you need to? (Maybe lose your job or something)?
Anyway, my dealer cleans my car whenever a I go there so we have already identified a saving. I do understand the concept but it does seem a little high. I would also be concerned that the 911's would be all out in the Summer and the Cayennes out in the Winter leaving me with the wrong car,
edited for reference, my Cayenne GTS is $1200/yr for insurance, $1500 for a set of tyres and approx $2200 for a 40k service. Not sure what the 20k costs
Edited by h0b0 on Friday 13th October 21:20
It's tempting to compare this portfolio subscription with the bog-standard lease... but that would be inaccurate, I reckon. A Dick Van Dyke with a bit of elocution does not an Englishman make.
Unlike a lease...
It's early days and the focus on high earners is understandable. Looking ahead, however, there may be many middle class folks who choose to participate for, say, three to six months. There's a lot on offer here, even for those of us from more modest means.
Six to eight Porsche cars in six months? I'd do this. When in history could you ever indulge in such uncommon experiences? It would be like a hybrid of everyday life and an extended holiday.
Unlike a lease...
- There is no long-term commitment. Opt out of the portfolio subscription at any time.
- You are able to choose another car every three to four weeks, on average, if you wish.
- When new models are launched, you have ready access to them via your portfolio subscription.
It's early days and the focus on high earners is understandable. Looking ahead, however, there may be many middle class folks who choose to participate for, say, three to six months. There's a lot on offer here, even for those of us from more modest means.
Six to eight Porsche cars in six months? I'd do this. When in history could you ever indulge in such uncommon experiences? It would be like a hybrid of everyday life and an extended holiday.
It's not for me and I think I'm target audience.. If you view it as short term rental then it is cheaper than Avis. But, the 911 cab I posted before would be under $1500/month all in. (Lease is $1150). Paying double that to get a pool 911 doesn't make sense to me. In fact, you don't get the cab in Passport so my half priced car is a bargain..
I'm trying to think of the logistics. Let's use my situation as example. I'm about 15 miles away from the dealer. I'm going to bet 99% of Americans are over an hour away from their dealer. But, NYC metro area has a captive audience. I'm in the Macan GTS, ($1000/month lease) and I want to go to Atlantic City for the weekend in a 911. My dealer is open late, so I can pick it up 7PM after work. That means driving 30 minutes North before heading South. Pain in the arse.
In Winter, we get feet of snow over night. Will the dealer have put Winter tyres on? My Cayenne was fantastic in the dry but my neighbors still mock me because they saw me drive mine down the road and get stuck. I turned around and jumped into my wife's car. It was fine because it had all season tyres on.
I'm trying to think of the logistics. Let's use my situation as example. I'm about 15 miles away from the dealer. I'm going to bet 99% of Americans are over an hour away from their dealer. But, NYC metro area has a captive audience. I'm in the Macan GTS, ($1000/month lease) and I want to go to Atlantic City for the weekend in a 911. My dealer is open late, so I can pick it up 7PM after work. That means driving 30 minutes North before heading South. Pain in the arse.
In Winter, we get feet of snow over night. Will the dealer have put Winter tyres on? My Cayenne was fantastic in the dry but my neighbors still mock me because they saw me drive mine down the road and get stuck. I turned around and jumped into my wife's car. It was fine because it had all season tyres on.
I thinks it's a great idea. It will enable more people to get into a Porsche and that's got to be a good thing. If it works competition will hot up and prices will get keener. I think Porsche may also be responding to rising interest rates and falling sales, and uncertainty, that will dent the typically good residuals. Their cars are very strong and maintenance / warranty excellent, so buying a used one shouldn't be a worry. But if the cars start to get a bad rep as rental jobs then look what else Porsche is doing - Porsche Exclusive. Don't want the commitment / bother of dealing with bills then rent, want to own then, madam, why not get something really special from our Exclusive branch. Want a GT3, forget it.
Does this mean they'll sell less Porsche cars overall, but make more profit off of each individual unit? It's a nifty way of cutting their production margins, I will give them that.
It could be the new way car manufacturers try to dodge emissions legislation, just like they are with hybrids.
It could be the new way car manufacturers try to dodge emissions legislation, just like they are with hybrids.
things I would like to add.
a) Porsche is looking at the amount of money being made by Porsche US, VW and Merc in the lease market and has realised it does not have a workable leasing model in many other countries. UK included. The lease market in the UK has exploded in recent years, Porsche are nowhere to be seen
b) Such a Passport programme provides an additional business case for maintaining and possibly expanding its OPC Network which no doubt have large over-heads
c) Youth is not interested in driving but like what they see on Youtube and Instagram, lowering the entry bar and widening the brands appeal for driving the cars is central to keeping Porsche alive in the long-term. In the UK you can obviously go and buy one but you really need £20k up-front for a finance package on a new 911 and today's younger have the attention span of a knat, I would not expect that to change as they reach late-20's early 30's.
Last but not least.
d) It is highly probably that in 10 years time or less, Porsche cars will be self driving and will more than likely be deployable from central depots and then be able to drive themselves back to the depot once you have finished using them.
If Porsches are unable to do this, other car manufacturers will be, the logistics behind this system is going to be more challenging for the OPC Network, in some respects, than the 'off-the-shelf' self-driving tech. itself.
You can talk about the cost to Porsche and how much money they will make out of this scheme, I would propose that largely, the future of Porsche, the OPC Network and the luxury car industry will be more about survival than out-right profit.
I like my Porsche.
I don't get to drive it much, but when I get home the first thing I do (after seeing the family) is open all the parcels of car parts I've bought for it and check to make sure it's as I left it.
I've spent a lot of time getting it how I want. I spend hours on the net learning about it, looking at how to's and other owner experiences.
I don't care if it depreciates and that I don't use it as much as I'd like. For me, ownership is more than just driving. Cars are a passion, I want to own it, call it mine and spend time on it even when I'm not driving.
So for me and any for car guy with his salt, this program is not for me..
I don't get to drive it much, but when I get home the first thing I do (after seeing the family) is open all the parcels of car parts I've bought for it and check to make sure it's as I left it.
I've spent a lot of time getting it how I want. I spend hours on the net learning about it, looking at how to's and other owner experiences.
I don't care if it depreciates and that I don't use it as much as I'd like. For me, ownership is more than just driving. Cars are a passion, I want to own it, call it mine and spend time on it even when I'm not driving.
So for me and any for car guy with his salt, this program is not for me..
Does this mean they'll sell less Porsche cars overall, but make more profit off of each individual unit? It's a nifty way of cutting their production margins, I will give them that.
It could be the new way car manufacturers try to dodge emissions legislation, just like they are with hybrids.
It could be the new way car manufacturers try to dodge emissions legislation, just like they are with hybrids.
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