Porsche's racing future (or lack of)..interesting article
05-31-2001, 10:35 AM
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Porsche's racing future (or lack of)..interesting article
Speedvision Editorial
Take a look at this editorial on speedvision. Looks like Porsche's best racing days are in the history books.
Greg
Take a look at this editorial on speedvision. Looks like Porsche's best racing days are in the history books.
Greg
05-31-2001, 08:36 PM
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Greg,
Between the racing difficulties with MB / BMW / Viper, the upcoming Cayenne introduction, and the monthly focus of Porsche on their corporate profits in Christophorus, you've got to wonder what the future direction is for Porsche.
I've no doubt that they've still got the engineering talent, but the agenda may have changed at the top levels of management. As a small fish in a large pond (with a lot of corporate sharks!), Porsche may feel that focusing on profits is the only way to stay independent.
However, you've got to worry that they will lose their very essence, and eventually appeal / prOfitability, if racing becomes a second-tier priority and every Porsche model has to share the same front end!
At 34 years old, aren't I too young to be already longing for the good ole days?!
Anir
Between the racing difficulties with MB / BMW / Viper, the upcoming Cayenne introduction, and the monthly focus of Porsche on their corporate profits in Christophorus, you've got to wonder what the future direction is for Porsche.
I've no doubt that they've still got the engineering talent, but the agenda may have changed at the top levels of management. As a small fish in a large pond (with a lot of corporate sharks!), Porsche may feel that focusing on profits is the only way to stay independent.
However, you've got to worry that they will lose their very essence, and eventually appeal / prOfitability, if racing becomes a second-tier priority and every Porsche model has to share the same front end!
At 34 years old, aren't I too young to be already longing for the good ole days?!
Anir
06-01-2001, 10:33 AM
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Anir,
Since this issue is often talked about I guess I will throw in my 2 cents...
The focus of a company may be profits but its the kind of profit that is usually cause for worry - long term versus short term.
With increased labour costs, greater mobility of labour (yes, even in Germany
) and, more importantly, increased mobility of capital and gradual easing of the cross shareholding patterns due to tax and other laws, there is going to be the same focus on performance for the next two/three quarters, etc. This will be driven by analysts who themselves are rated too. The result is term-appointed CEOs who have to behave in a certain way. To be a top gun at a company that is just about to use up its brand cache is a great position for a new CEO to launch himself. I envy the Porsche top brass. The company may or may not be already widely held but it will increasingly be managed like it is as the ease of shareholder change increases thereby changing the writing on the wall for the CEO. Cashing in on brand without filling up the reservoir is a losing proposition which is why you will NEVER see a truly great restaurant managed by a large company - which does not mean that it will NOT be tried again and again but investment bankers gotta eat too ) (merge and divest). You may see a truly great chef retiring to make big profits by becoming head chef of Burger King after twenty years of running his Michelin 3 starred restaurant!!! I would not begrudge him his right.
No, I dont really long for days gone by. I think the challenge for us is to figure out how to make things work well given the newer realities. For the right risk premium/reward equation, I think, over time, there may be a certain kind of investor capital ready to invest in building brands too (we saw a somewhat strange deviation of that kind of capital in the dotcom no profit market - not a great comparison at all but ... ). But yes, in the absence of such a model emerging, high end brands will need to be family owned for now and even that may not be enough due to the mobility factor. Just one pt of view.
[ 01-06-2001: Message edited by: Ran ]
Since this issue is often talked about I guess I will throw in my 2 cents...
The focus of a company may be profits but its the kind of profit that is usually cause for worry - long term versus short term.
With increased labour costs, greater mobility of labour (yes, even in Germany
) and, more importantly, increased mobility of capital and gradual easing of the cross shareholding patterns due to tax and other laws, there is going to be the same focus on performance for the next two/three quarters, etc. This will be driven by analysts who themselves are rated too. The result is term-appointed CEOs who have to behave in a certain way. To be a top gun at a company that is just about to use up its brand cache is a great position for a new CEO to launch himself. I envy the Porsche top brass. The company may or may not be already widely held but it will increasingly be managed like it is as the ease of shareholder change increases thereby changing the writing on the wall for the CEO. Cashing in on brand without filling up the reservoir is a losing proposition which is why you will NEVER see a truly great restaurant managed by a large company - which does not mean that it will NOT be tried again and again but investment bankers gotta eat too ) (merge and divest). You may see a truly great chef retiring to make big profits by becoming head chef of Burger King after twenty years of running his Michelin 3 starred restaurant!!! I would not begrudge him his right.No, I dont really long for days gone by. I think the challenge for us is to figure out how to make things work well given the newer realities. For the right risk premium/reward equation, I think, over time, there may be a certain kind of investor capital ready to invest in building brands too (we saw a somewhat strange deviation of that kind of capital in the dotcom no profit market - not a great comparison at all but ... ). But yes, in the absence of such a model emerging, high end brands will need to be family owned for now and even that may not be enough due to the mobility factor. Just one pt of view.
[ 01-06-2001: Message edited by: Ran ]