BruceP

Yup, afraid you're right. Our friend is a bit vague on the business model of a company like Porsche. If we were talking about a high volume manufacturer, this kind of stuff would make some sense. A few dollars a car in exchange for some remote liability risk. But seriously, look at the unit margins on these things. No sane marketer would nickel and dime like that with his brand's reputation at stake when all he has to do is charge a bit more for the embroidered headrest logo.

cdodkin

Which is limited by market conditions - so if you can cut your base costs, say by shaving your CAFE and reducing a Federal fine off your bottom line by millions of $$$, then as a business, that's exactly what you'd do.

Sound reasonable?

You appear to be in denial that Porsche are in this to make maximum profit.

Maximizing profit works at all levels - including oil selection by the manufacturer.

It's business - pure and simple.

wrljet

I hope they still have enough pride and honesty, though, to not recommend oils known to be inferior by themselves, just to make a buck. Hell, they're already the most profitable car maker by unit on the planet.

BruceP

Sorry, but are you actually in business? Because I am, and the logic of this eludes me. This is a low volume, high margin enterprise. You don't survive in one of those by betting big on tiny marginal cost savings. A business that survives isn't trying to maximize profit, it's trying to maximize profit sustainably. I could see GM doing this. I could see Toyota doing this. But Porsche would have to have slept through four years of B school to make a dumb bet like that. It just doesn't make sense. Especially when, as you quite rightly point out, they could recover the cost from the oil company who put their sticker under the hood instead.

Now if I was Porsche, I might try to improve my CAFE by, say, buying Volkswagen... hmmmm....

1999Porsche911

Some people have apparently no business sense. Bottom line is that all succesful buinesses worry about the nickle and dimes and anyone that would suggest that they don't would not be with the company long.

cdodkin

Bruce,

I only run an IT company, so I bow to your experience as CEO of a major auto manufacturer

cdodkin

And as a matter of interest - I noticed that my Volkswagen TSB on oils (2004) now shows a change to Mobil1 0W40 in my Passat Wagon, where previously it was Mobil1 5W30....

And all since they introduced the Cayenne, I mean Touareg

Just co-incidence I'm sure

BruceP

Now, now girls. No need to get shirty. I have 27 years of marketing experience, advising tier one packaged goods, services and durables companies, including Toyota and Honda. Despite that, I'm not saying that I'm infallible. I'm just saying that my own understanding of how to run a big business doesn't seem to support the motives you speculate Porsche to have regarding the selection of oil grades.

And Mr. 1999Porsche911 is, in my own humble experience, grossly overgeneralizing. I've been in countless meetings where profit has been foregone because short term wins would harm long term sustainability and value. Sadly, not everybody gets this, of course. I recommend a book called The Reckoning, by the late David Halberstam. It tells the tale of how Detroit gave away market domination by thinking just the way you are, so I'm not saying that you won't find people who agree with the 'squeeze every nickel you can' approach to business. You just won't find them in high margin businesses.

wrljet

Many of the oils (including various grades of Mobil 1) have been reformulated recently, because of a lawsuit that allowed blends and oils using non-sythetic base stocks to be called true synthetics. Also a switch to a new API standard has removed some zinc and other additives (for EPA) that are important to various motors. The air-cooled guys are all in a twitter over this. And I suppose since we have flat tappet motors we should give it some consideration.

Luckily Porsche, VW, and BMW continue to test oils religiously and update those recommendation lists for us!

Bill

cdodkin

Bruce,

I'm sure you have something more than intuition or personal business acumen to back your position that the move to 0W40 by Porsche was made solely based on on-going technical and engineering reviews, and was not influenced in any way by any external or internal financial considerations or legislation?

I'm not telling you what to put in your car - I'm just asking you to be reasonable and look at the whole picture.

There's more to all of this than pure engineering - it's engineering at a price point.

cdodkin

Bill - well aware of that legal action - Castrol did none of us any favors by pushing to allow PAO base stocks to be used to make synthetic!

Doesn't explain the move to 0W40 in this case, as 5W30 Mobil1 was already fully synthetic (by the pre Castrol definition).

VW changed grades of synthetic in this case, so it's not a case of semi-syn to synthetic.

Their move to all synthetic is easy to understand, after they had significant sludge issues in engines running on dino oil - and paid dearly in court for it!

BruceP

I'm not really arguing with that. I'm grown up enough to know that it's also a business decision, not just an engineering decision. What I am arguing with is the premise that because it's a good business decision, it's per force a bad engineering decision. They have no motive to harm their own product. A good business decision would be one that returns something to the bottom line without creating new costs or liability. So, as a consumer, I'm then faced with my own choice: trust that Porsche isn't looking to **** me off and wreck my car, or assume that they're ruthlessly profit motivated and don't care, and cast my fate to some self-styled experts on the internet (who may be correct and brilliant, but also may not).

So, as I said earlier, I'm going to bet on the people who have the most to lose by being wrong.

And thank my lucky stars that I live such a good life that I can afford to spend an afternoon debating oil viscosity. I don't know where that is on Maslow's hierarchy exactly, but I bet it's right up there.

wrljet

The cost of replacing all the blown/damaged motors (and loss of confidence and goodwill) is factored in too.

1999Porsche911

Try sitting on the Board of a couple of Fortune 500 companies and you'll see quite clearly how important spending and cost cutting is as well as how even the smallest of items are considered. Even more important if you are publicly traded.

wrljet

There's more to it than the synthetic or not aspect.

This website explains a lot of it. I have no idea if it's fact resulting from thorough scientific research and understanding, or a load of bull:

http://www.lnengineering.com/oil.html