biko

That could be true or it could be false. It all depends on what costs were booked against what revenue. What capital was booked when, depreciation, etc.

It's hard enough when one has the financials in hand. Fool's errand without.

Whoopsy

Since they are a private entity, black and white financial statements will be out of the question. But one can make educated guesses based on general rules according to GAAP. It's actually not that hard if one doesn't need precise numbers.

Like the amortization of their factory cost, they are not going to write off the whole building on the 1st year. Same for equipments inside. Plus one can deduce roughly what amount they bring in selling ~1700 cars a year.

Year to year, there isn't drastic changes on their bottom-line, they didn't purchase/construct or sell anything major, so no 1-time items. While the tooling for new models, i.e. P1 and 650S is one 'major' expense, it is quite small in $ terms as those are based off the same 12C platform. The wind tunnel cost for developing the P1 can be billed as nil, as the wind tunnel is a existing structure which has already been paid for, same for the wind tunnel personal cost, those are fixed cost whether McLaren used them to tune the P1 or not, the F1 team cannot use the tunnel full time thus there are a lot of free time.

McLaren Automotive is a separate entity outside of McLaren Racing and McLaren Applied Technologies the consulting business, the financial are reported separately, so income from one entity doesn't carry over to the others. I believe the wind tunnel is under McLaren Racing, so in theory Racing can bill Automotive for the time used, but that does not make sense as Automotive needs to show it's making money quickly to the investors and that's one part that definitely can use accounting tricks to minimize Automotive cost.

Whoopsy

Simple. Performance and flexibility.

Unless one likes to drive on a sheet of ice, there is no way 2 tires can handle the HP putting down by modern performance cars. AWD means traction on any surface, it's why the 918 can leave the P1 and LaFerrari in the dust from a stop.

With 2 motors front and back, one motor can do traction duty while the other do recharge. The 918 can using the front motor for traction duty while the engine drives the rear motor as a generator and putting down power at the rear wheel at the same time. Something the P1 and the LaFerrari cannot do. Those 2 can only use their motor either as a traction motor or a generator, not both.

Also, the 918 will capture more of the kinetic energy on regen braking as both axles contribute to charging, the P1 doesn't have this capability and the LaFerrari can only capture energy from the rear wheels.

biko

All rational assumptions for sure.

But let's start with: how did they define profit? Are they using the same definition of profit before and now? Was it truly a net profit or an operating profit? How about write downs taken in one year versus another?

Not poking at McLaren or you. I think it is near impossible to state with any kind of authority a company's financial state without... seeing their financials. The fanboys are joyful over McLaren turning a "profit" and the haters predict McLaren is going bankrupt. No different than criticizing the 918 as "unprofitable". Baseless unless you have numbers in hand. (Besides if the 918 is unprofitable then buyers are getting a great deal!)

Speculate all you want, it is the Internet!

Sorry

biko

Hey Whoopsy, just to close the loop: McLaren declares an operating and pre-tax profit in 2013. This is well before the bulk of P1 deliveries and before the 650s for that matter, so largely on 12c sales.

http://media.mclarenautomotive.com/release/254/

Excerpt:

Whoopsy

And McLaren sold less 12C in 2013 than 2012.

They sold 400 in 2011, 1587 in 2012, and 1359 in 2013. Total: 3346.

They delivered 36 P1 also. These 36 more than accounted for the 200 less 12C and more in profit just by the numbers.

Some other tidbits, McLaren initially had 2 dealerships in China, then added 2 more, and now they are up to 9, and there should be another 3 coming. They had given 10 franchises in one go last year, basically whoever can pay the franchise fee will get one. But the new franchises were only given 12C to sell, they didn't get any 650S, so in other words those 10 new ones were the clearing house for last of the 12Cs.

All of US only gets 14 dealerships, plus the 2 in Canada. Is China as big a market as the North American market? Eventually it will be, but not now. Some of the 12 dealerships in China may not survive.

My source of info is largely from the financial circle, not from the automotive circle, those guys see things from a different perspective.

biko

Regardless sounds like they are doing the right thing for a young company. Hard to judge from afar. Having sat on boards of both small and big companies it's never easy. Although Ferrari seems to have the least amount of headwinds.