Whoopsy

No, your logic is the flawed one.

Whom you write the title to on your cheque when you pay for a Porsche? PCNA? Porsche AG? No, you write the cheque to the dealer. The dealers are the ones writing cheques titled to PCNA.

PCNA sell cars to dealers, it's the dealers job to move the product to THEIR customers. Say a dealer has a lot full of unsold cars, it's the dealer's problem, not PCNA, as those cars are paid for by the dealers already and PCNA already accounted those cars as sales. BUT, not delivered.

Porsche's marketing is to drive end users to their customer (dealers), so Porsche's customers (dealers) can buy more cars from them.

Tesla is the only manufacturer that can say their customers ARE the actual end users.

STG

Cars are not counted as SOLD until the warranty is PUNCHED. Dumping a car on a dealer lot does not count it as SOLD for PCNA accounting purposes. So unless someone buys it, it's not technically sold. PCNA does play the "punch the car" game and gives dealers trunk money to do so to inflate sales numbers.

You're having trouble seeing the forest for the trees.

WernerE

Dealers have franchise laws to protect certain rights, but these are are a patchwork quilt since they vary by state.

Porsche has many levers to pull on non-compliant dealers. Allocations, market penetration expectations, facility improvements -- the list is long and represent gray areas not easy to challenge without costly legal efforts. I don't think the isolated # of second stickers rises to the level that Porsche will push back, at least currently.

These factory bonus programs are another story. I would venture to say most, if not all, dealers are worse off for them. It's a form of economic leverage against the dealers, because the former alternative of litigating a "wayward" dealer is a lengthy, costly process. Even those dealers who claim to be "whole" don't know the full cost of complying with all the incentives. Imagine if you were running a business and your "partner" cut your gross in half, reserving the other to be paid later provided you perform up to an arbitrary "standard," which are moving targets and are increasingly hard to reach.

The manufacturers are controlling more and more aspects of how a dealership operates, and if the dealer doesn't comply, it won't make the kind of money it formerly made as an independent business. I do not see an end to it, nor do I see second stickers as "out of reach" in Porsche's interest in curtailing the practice. Does the customer who bent over for $50k above MSRP give the dealer a "10" in the survey, the results of which can determine whether the dealer qualifies for CSI money? That's a risk assumed by the dealer.

WernerE

Actually, Porsche does count a sale when inventory is shipped to the dealer. FCA got in big trouble when it leaned on its dealers to punch cars to report a "retail sale" number for Wall Street, a data point that means more than the # of units shipped to dealers.

The problem of punching a car sale prior to delivery is that the warranty clock starts. If the factory wants to report a big retail sales number to impress Wall Street, it has on occasion told its dealers to "punch the cars." For dealers, there is disclosure to its customer that a portion of the warranty has expired. Even Porsche dealers have done this, but not on the scale of FCA, cited recently in Automotive News.

STG

Who is FCA??

STG

PCNA July 2016

Stated as "sales". Actual cars SOLD. Not shipped to dealers.

Each time a car is "punched" it's marked as sold. Hence the "punch the car" game.

Am I missing something here?

http://www.prnewswire.com/news-relea...300308120.html

WernerE

Fiat Chrysler.

The significance of the punch is that its presumed a retail sales number. It occurs for both internal and external reasons, but the practice is discouraged. The SEC is looking at FCA.

WernerE

Two kinds of sales: Wholesale and Retail

Cars "sold" by the factory to the dealer are equal to "shipments"

Cars "sold" by the dealer to customer (delivered) are "retail sales."

STG

But what is the measure they are held to in their industry compared to other brands?

I assume retail sales? That's all I ever see referenced.

Otherwise they could just crank out cars to hit sales numbers.

Gef3rd

I've seen both Ferrari and Porsche dealers "punch" cars before they are sold. Their motivation being the factory will ship additional cars to replenish the dealership's inventory.

Modena 1

That is standard practice in the auto biz. Sometimes at the request of HQ, to make sales figures, sometimes at dealer discretion to make an incentive.

white6speed

Based on sales reports BMW punched 6-700 i8's in December 2015 as at one point they had almost 1000 unsold cars in the US. They reportedly sold 6-700 cars in December and 50 in January.

WernerE

Retail sales is the key metric. Production numbers are also important but a retail sale is a more accurate, relevant measuring stick across all brands.

STG

So back to my point, it's the customer (retail) sales that matter. Who cares how many cars dealers have sitting on their lots. PAG and PCNA care about how many cars make it into customers garages. Another post by Whoopsy seemed to infer that the dealers trumped the actual buyer. Without the buyers, dealers and PAG/PCNA are left scratching their nuts (which seem to be a bit ego inflated at the moment).

Whoopsy

And they do.

Regular retail customers basically has no say to Porsche. Invisible.

Even when the collective VIP group, which for all intends and purposes have a bigger sway than regular Joe, tells Porsche something, the dealer group tells Porsche another thing. Porsche still ended up doing what the dealer wants.

Just talking about the North American VIP group, those 300 or so owners, apart from the 918s, everyone basically bought a GT3, GT3RS, GT4, R, in addition to other regular production cars like Cayenne, Panamera, 911s, all within the last 2 years or so. Roughly speaking 5 extra cars on top of the 918, that's another 1500 cars sold by Porsche just in North America alone. In Europe and the rest of the world where there isn't a VIP program, most 918 owners still most of what they want and they have at least buy another 3 cars if not more. Globally, the 918 owners basically are responsible for around 3-4000 extra cars Porsche sold. But in Porsche's eyes, the dealers are still that much more important than the 918 VIPs.