Flying Finn

I knew that 996 was quite a bit cheaper to produce than 993 and that 997 is even cheaper than 996 but $26K per vechile, wow...

See the article.

jason1st

Damn those bastards!!! Profiting from innovation. How selfish!

texas911

How dare a company try to make a profit.

Paul523

If that's the average, then Boxster/cayenne s carry probably $20K margin, which means 997 @ $35K+ margin!

robbonds

how much does the dealer actually make?

1999Porsche911

It's more like a net of under $10,000 per car for 2005, but that is true numbers not typical massaged numbers that compnies love to report. If you were to use the $28,000 per car figure, Porsche's annual net would have exceeded $5 billion, not the less than $1 billion they had.

Read the financials and not the hype.


I guess articles like this make for fun conversations though.

OCBen

I presume you worked from the percentages that each model makes up in total vehicle sales, to arrive at that, right?

Total Profit from Vehicle Sales/Total Vehicles Sold = AVG PROFIT

cvazquez

Expense + Sell = Profit

The 20K per car fig IMO is ridiculous!

OCBen

They also have other lines of businesses besides vehicle sales that they derive profit from which must also be listed in their financials.

Total Net Profit for the company will always be lower than the profit margins per vehicle sold, as the whole operation must be taken into account.

OCBen

I think you mean to say:

Wholesale Price - Cost of Goods Sold = Profit Margin per unit of sales

And I believe that is what the article is discussing.

The net profit for the company is altogether a different matter, as operating expenses must be considered which obviously bring down total net profit for the company.

Edgy01

I have the numbers written down somewhere. I recall something like 14% on the base car, and another 20% on the options. Will confirm later.

Clearly, knowing those numbers is important BEFORE you start your price negotiations with them.

RallyJon

Nope. It's the net profit before tax. Gross margin (what you call Profit Margin) is much higher, of course.

Flying Finn

No probmlem with company making a profit. It's not companys fault (at all) if it's customers pay a lot "extra" for their products.
I just find Porsches profit, when compared i.e. to BMW, to be quite astonishing ($28,000 vs. $3,200).

OCBen

Of course it's before tax.

Taxes, which are sometimes arbitrary, are never factored when evaluating profit health of a business operation. That is why companies relocate to locales with lower taxes where they can make more profit because their operation is healthy and profitable, and will become more profitable somewhere else with lower taxes.

1999Porsche911

So, your net worth is not decreased each year by the amount of taxes you have to pay? You do not consider taxes part of your cost of living (doing business)? Let me know how you do it...sounds like found money to me.

Operating income does not automatically translate in net profit.