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The question is, why would you? The demand ebbs and flows like everything else. Luxury items need scarcity.
Important excerpt to note from the Bentley CEO:
“It's all about these higher price cars with more personalization, order bank driven, not stock build driven; and we've got the right formula, and we're going to be ruthless about maintaining that [profit] pool.”
Scarcity is one thing, but this is a supply chain issue, and the supply of these cars is far below the demand. At the moment, my Porsche dealer has essentially no allocations for new Porsches, almost their entire business is in used cars. They've been paying well over MSRP for some used cars, but are starting to moving away from that as they see prices starting to drop.
Scarcity is one thing, but this is a supply chain issue, and the supply of these cars is far below the demand. At the moment, my Porsche dealer has essentially no allocations for new Porsches, almost their entire business is in used cars. They've been paying well over MSRP for some used cars, but are starting to moving away from that as they see prices starting to drop.
new Porsches including base Macan/Cayenne/Panamera? I thought allocations for them are still fairly easy to get.
new Porsches including base Macan/Cayenne/Panamera?
yes. My dealer has 2 macans and 2 panameras on the floor unsold, and a gt2rs. That’s it. That’s all the inventory. Everything else is already sold, or is sold before it hits the floor. He had a lot of walk ins this weekend. I hope they don’t want a 911
new Porsches including base Macan/Cayenne/Panamera? I thought allocations for them are still fairly easy to get.
Their website shows two Cayennes and three Macans for new inventory; not sure which of these are in stock vs in transit. I didn’t ask about allocations for these. But allocations for ‘sports cars’ are nil at the moment.
The data here doesn't seem to fit the narrative that it's hard to get an allocation because Porsche is unable to make a normal amount of cars due to supply chain problems. Rather, it seems like demand is just far outstripping supply. If Porsche is making plenty of cars and demand is up for a few years, won't there be a surplus of cars and a fall in used car prices (and no ADM) when demand drops to a normal level and people start selling their pandemic cars (or keep them and don't need to buy a new one)?
... and yet, ADM is still $50k+... if the GT3 ADM was going to tank, I reckon we would already be there
This quoted ADM is less than some have quoted before, and is already clearly trending down. It's going down and will go down more. Just like other luxury items are moving in that direction following the home arena evolving as many others will suggest time and time again. It's not stuck at 50+ now. Nothing changes instantly, just like how they went up.
The other thing is that the Fed raised interest rates again, and signaled resolve to keep raising them to get inflation under control. That will impact home equity values, car purchases, and much else. Stock market reacted with a sharp downward turn after that news, which indicates that the Fed's position was a bit of a surprise. I think this will put some added downward pressure on Porsche prices.
Another data point: my dealer recently sold a 2021 Turbo S for $30k over MSRP (500 miles on the car). The car had been sitting for months, and once the price dropped to $248k it was sold. The dealer currently has no allocations for a Turbo or Turbo S, and doesn't know when they may get some. I told them to put me on the list for a Turbo (don't really 'need' Turbo S), and I guess we'll create an order demand.
Here's a good analysis of price trends for 911 Turbo and Turbo S cars. Collectible cars are stable or increasing in price, the other cars are trending down in price (especially the 992).
The question is, why would you? The demand ebbs and flows like everything else. Luxury items need scarcity.
Important excerpt to note from the Bentley CEO:
“It's all about these higher price cars with more personalization, order bank driven, not stock build driven; and we've got the right formula, and we're going to be ruthless about maintaining that [profit] pool.”
Bingo!
Luxury items are not produced in volume. They need "scarcity" and the opportunity to "personalize".
The Bentley CEO (and other CEO's) in this high-end automotive market know exactly what the ingredients are for maintaining their (profit) pool.
The finely tuned cash machine that is Ferrari vs Aston Martin which has suffered from weak profitability and persistent operational problems.
Ferrari is the finely tuned cash machine AML needs to become. AML isn’t shy about the link: It hired former Ferrari CEO Amedeo Felisa to be its new boss in June, as well as a former Ferrari engineer as chief technical officer. Ferrari will probably make about twice the number of cars AML does this year, yet it has almost 17 times the enterprise value.
That comparison highlights the opportunity for long-term investors if AML can finally be turned around. Very few car brands can command prices as high as Aston Martin, and most of them are doing well. Volkswagen last week reported Ferrari-like profitability at its most expensive brands, Lamborghini and Bentley.
The mental gymnastics here to figure out the price fluctuations of GT cars can make for a dissertation.
At the of the day, Porsche GT cars are not Veblen goods, they're not even Giffen goods, they're just essentially tarted up 911's. Really fast and capable tarted up 911's, but at the end of the day they're just basically a 911.
Go out and drive your GT cars that you already own, however you want -- at the track, to Cars & Coffee, to Costco, or just to get gas.
If you decide want a new 992 GT3/RS, figure out if you have the money to pay the market price, or if not, the time to wait it out.
At the of the day, Porsche GT cars are not Veblen goods, they're not even Giffen goods, they're just essentially tarted up 911's. Really fast and capable tarted up 911's, but at the end of the day they're just basically a 911.
Not sure I'd describe it that way. Just took my new-to-me 991.2 C4S cab for a long honeymoon drive. In some ways, it's quite similar to my 991.1 GT3, but in other ways quite different. There's much overlap in what they do, but if, for example, you want a screaming linear NA engine, you have to get a GT. If you want ability to drive in decent comfort, GT probably isn't the way to go. Each variant's strengths come with some compromises, none of them can really 'do it all'.
11-02-2022, 11:53 PM
