Porsche Announces Significant Price Increase for 2024 Models
Porsche has said the price increase is required to maintain high profit margins in the face of increased costs to build EVs.
If you have been kicking around the idea of buying a new Porsche, you might want to pull the trigger soon. Autocar was the first to report that Porsche will impose “significant price increases” on its cars starting around the middle of this year. The price increase is likely to touch every vehicle in the Porsche portfolio.
Finance head Lutz Meschke made the pricing announcements on a call with analysts. “We will see significant price increases in the middle of the year for the new model year. That will help a lot to make sure we make strong group operating margins,” Meschke said. Porsche is targeting a 20 percent return on sales. The increased costs incurred by transitioning to electrified vehicles is one of the main drivers behind the price increase. Porsche won’t be able to realize that 20 percent return without it.
And while on the topic of electrification Porsche went on to say that the electric versions of the Macan, 718 Boxster, and Cayenne will be priced 10 to 15 percent higher than the ICE versions. ICE versions will likely be sold next to the EV versions of these vehicles for a period of time. But you will pay extra for the EV version. Porsche plans to hit 50 percent electric and plug-in hybrid sales by 2025. By 2030 they are targeting 80 percent electric sales.
Customer Reaction
Porsche believes that customers will not flinch at the higher prices. “We have a very good foundation with a very strong brand and a very strong customer base that gives us the power to increase prices in very challenging times and in an intelligent manner,” Meschke said. That is a lot of “very,” but is Meschke right? Porsche has been enjoying tremendous sales lately.
But if they hike the starting price of a base 911 Carrera to over $120K will consumers begin to balk? Will the myriad Porsche options available also see a significant increase in price? That was not made clear. However, if each option sees a corresponding price increase, anything with the Porsche badge is going to cost a lot more money soon.
Ferrari Hunting?
The cost of R&D for electric vehicles as well as the cost for materials to build them is substantial. So, it is understandable that Porsche would want to cover these costs with a price increase. However, is there something more going on? Is Porsche trying to move further upmarket?
They are expanding their Sonderwunsch (special request) program. Paint to sample is expanding. The number of special edition cars is expanding. Porsche seems to be pushing hard the idea of more exclusive and custom cars. And they seem to want the pricing to match. A larger (and more expensive) SUV that slots above the Cayenne is reportedly in the works as well. Is Porsche trying to tap into the Ferrari customer base?
Trickle-Down
So, if new Porsche cars and SUVs are going to get significantly more expensive, what does that mean for the used Porsche market? Prices have been cooling lately on used Porsches. But in the face of this announcement could we see that trend begin to reverse itself a bit? The macro-economic situation remains the same. There are still high interest rates and inflation to contend with. That has been suppressing prices.
But if a base 2024 718 Boxster jumps from $65,500 to $75,000 it stands to reason that the prices of the older 982 generation cars could also see upward price pressure. This all remains to be seen. But one thing is clear. Buying a new Porsche is about to get more expensive than ever.
Photos: Porsche
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