Is porsche pushing it ?
08-12-2003, 06:57 PM
#31
Rennlist Member
Read Forbes Magazine article: " Porsche Goes Soccer Mom" by
Robyn Meredith, in the 02.04.02 issue.
I lost my copy, but the highest margin was on the Turbo and the lowest was on the Boxster. It didn't say in the article, but I remember thinking at the time that the margin on the GT2 must be ~100%.
Robyn Meredith, in the 02.04.02 issue.
I lost my copy, but the highest margin was on the Turbo and the lowest was on the Boxster. It didn't say in the article, but I remember thinking at the time that the margin on the GT2 must be ~100%.
08-12-2003, 07:52 PM
#32
Race Director
First off, I don't think anybody buying $100k+ new Porsches has depreciation and gouging as some of their major buying decision factors. Then there are plenty of cases where the profit margins are obsene. Every major down town hotel in SF charges $5 for a glass of soda that is 95% ice by volume, so what's the margin there. I'm an architect working out of my home, so my production costs is virtually zero. My clients still pay my asking price.
The fact is consumers have different priorities, and Porsche targets the 200 or so patrons who do not care much about 'value'. And history is on their side on this one.
CP
The fact is consumers have different priorities, and Porsche targets the 200 or so patrons who do not care much about 'value'. And history is on their side on this one.
CP
08-12-2003, 09:40 PM
#33
Addict
Rennlist Member
Rennlist Member
Join Date: Jun 2003
Location: Frederick, MD
Posts: 642
Likes: 0
Received 0 Likes
on
0 Posts
Business week has reported that Porsche earns 15.8% making it the most profitable car maker with regards to operating margin. - followed by Nissan, Toyota, and BMW group.
08-12-2003, 11:36 PM
#34
Pro
Join Date: Jun 2002
Location: Bethesda, Md
Posts: 533
Likes: 0
Received 0 Likes
on
0 Posts
This figure sounds quite convincing, the Economist reported figures in this ball park a while back. This is the profit margin after all costs. However, the catch is that most companies don't do much analysis on allocating their overheads and it is not that important anyway.
Take a few examples, Wiedeking's salary should it be split proportionally to each products line, or more to the Cayenne it being more recent and probably requiring more of his time? Another example, if Porsche developed the engine for the boxster first, then uses the experience to shorten the developement of the 996 engine?
How does one allocate those costs to the individual model lines? Irrelevant to the shareholders I am afraid...they only care about overall performance, as they should. So some extra profit on specialty models can get some reporter at the NYT (IMHO less then quality reporting anyway) all worked up but in the end the only thing that counts is for Porsche to be able to fund its capital requirement from cash generation and financing without needing cash from shareholders which would put it at the mercy of take over artists....
Sorry about the technicalities here, I am not Grubman in disguise :-) but my work does include understanding the economics of companies.
Rgds
LV
Take a few examples, Wiedeking's salary should it be split proportionally to each products line, or more to the Cayenne it being more recent and probably requiring more of his time? Another example, if Porsche developed the engine for the boxster first, then uses the experience to shorten the developement of the 996 engine?
How does one allocate those costs to the individual model lines? Irrelevant to the shareholders I am afraid...they only care about overall performance, as they should. So some extra profit on specialty models can get some reporter at the NYT (IMHO less then quality reporting anyway) all worked up but in the end the only thing that counts is for Porsche to be able to fund its capital requirement from cash generation and financing without needing cash from shareholders which would put it at the mercy of take over artists....
Sorry about the technicalities here, I am not Grubman in disguise :-) but my work does include understanding the economics of companies.
Rgds
LV
