Porsche Tidbits

[sirAQUAMAN64]

Porsche more upbeat after VW impact boosts first half earnings

Reuters / January 26, 2007 - 9:00 am
 
FRANKFURT (Reuters) -- Porsche AG forecast today that it would be able to keep profits steady this fiscal year after income from its Volkswagen stake helped first-half pretax profit surge.

Earnings before taxes swelled to $1.9 billion (1.45 billion euros) from 277.8 million euros a year before, while profit after tax rose sixfold to $1.36 billion (1.05 billion euros), according to preliminary figures released before the sports car maker's annual meeting.

Porsche cited enhancement of its model mix and a one-off gain from its 27.4 percent stake in Volkswagen, in which it became the largest shareholder last year via a surprise swoop that Porsche said headed off a hostile takeover of VW.

Hedging proceeds from the VW stake totaled hundreds of millions of euros, while revaluing the VW shares contributed $671.6 million (520 million euros) more, it said.

One analyst who asked not to be identified said he had heard from Porsche the hedges generated $775.0 million (600 million euros) in income.

"Assuming there are no surprises with VW or with the VW stock price, Porsche is confident to be able to achieve the previous year's result of 2.1 billion euros ($2.71 billion) in the current year of business," the company said in a statement.

percent.

Stripping out $671.4 million (520 million euros) in VW revaluation gains, $774.7 million (600 million euros) in hedging income and $9.0 million (7 million euros) in associate income from VW would show underlying operating profit of $417.0 million (323 million euros), one analyst calculated.

First-half revenues including divestment gains edged down 2.9 percent to $3.90 billion (3.02 billion euros), while vehicle sales slipped 5.9 percent to 39,750 vehicles given a model changeover for the Cayenne SUV.

Porsche said it intended to keep full-year unit sales steady near the 96,794 vehicles it sold the previous year.

At the Detroit auto show early this month, CEO Wendelin Wiedeking had struck a slightly more optimistic tone about pretax profits in the financial year ending July.

He cited good business so far this year and solid orders for the refreshed Cayenne.

At a news conference in December, Wiedeking had said Porsche would struggle to match the record $2.72 billion (2.11 billion euros) in pretax profit it made in 2005/06 fiscal year.

[sirAQUAMAN64]

Porsche picks family member to be new chairman

Reuters / January 26, 2007 - 9:00 am

STUTTGART, Germany (Reuters) -- German sports car maker Porsche named a member of its controlling family, Wolfgang Porsche, to become chairman, it said today.

Wolfgang Porsche has been a member of its supervisory board since 1978 and will replace Helmut Sihler as of the end of today's annual meeting. Sihler is retiring after 14 years as chairman.

[sirAQUAMAN64]

http://www.detnews.com/apps/pbcs.dll/article?AID=/20070305/UPDATE/703050383/1148/AUTO01
Porsche net profits up in first half of 2007

David Rising / Associated Press

BERLIN -- Luxury sports car maker Porsche AG confirmed Monday that net profit soared in the fiscal first half of 2007, boosted primarily by a gain from its stake in Volkswagen AG.

Net profit rose to euro1.14 billion (US$1.5 billion) in the half ending Jan. 31, higher than the euro1.05 billion (US$1.38 billion) preliminary figure reported in January at the company's annual general meeting, compared to euro170 million in the same period a year earlier.

Porsche's 27.3 percent Volkswagen stake contributed a more than a euro1 billion (US$1.32 billion) gain while the revaluation of Volkswagen shares held by Porsche yielded another euro520 million (US$684.48 million), the company said.

"Since the start of our investment in Europe's biggest automotive group around a year and a half ago, Porsche's share price has risen by 50 percent and Volkswagen's share price has doubled," the company said in a statement. "Any initial doubtful voices in relation to our shareholding in VW have long since faded."

Sales fell to euro3.07 billion (US$4.04 billion) from euro3.11 billion -- slightly better figures than initially reported -- as Porsche sold 39,265 cars, down from 42,230 in the same period a year earlier.

Porsche attributed the overall 7 percent drop in unit sales to the model change for the Cayenne SUV. Production of the first generation Cayenne was discontinued in November 2006 with sales of the new model not starting in Europe and Asia until late February. On the other hand, sales growth of the mainstay 911 and Boxster series were up 15.7 percent and 19.6 percent respectively.

Earnings before taxes rose to euro1.59 billion (US$2.09 billion) after a figure of euro278 million in the prior-year period and Porsche reiterated its expectation of surpassing 2006's pretax profit of euro2.1 billion (US$2.76 billion) in fiscal 2007.

"Porsche is more optimistic for the 2006-2007 fiscal year as a whole than it was at the beginning of the fiscal year." the company said. "Even the difficult market environment in the USA does not overshadow this optimism. Porsche aims to match the high prior-year level of unit sales and sales revenue with the growth markets in eastern Europe and Asia contributing substantially to sales."

It said, for example, that it was increasing the number of dealers in China from 12 to 20 and was "confident that it can double unit sales in China this year by comparison with the previous year, during which roughly 1,920 vehicles were sold."

No quarterly figures were released.

Porsche shares were down 3.3 percent in midday trading in Frankfurt at euro936 (US$1,232.06) amid a general drop in the market.

[sirAQUAMAN64]

Porsche will be a no-show at Detroit show

Diana T. Kurylko
Automotive News
June 11, 2007 - 1:00 am   
 
Porsche is pulling out of the Detroit auto show to focus on shows in regions where it has more customers.

"It was purely a business decision," says Tony Fouladpour, a spokesman for Porsche Cars North America Inc. "We want to target our marketing resources on more direct customer contact."

Porsche says it sold only 290 cars in Michigan last year, compared with 8,827 in California, 4,177 in Florida and 2,172 in New York.

Next year Porsche will be at the Los Angeles, Chicago, New York, Miami, Toronto, Dallas, San Francisco, Philadelphia and Washington shows.

"It is about allocating our marketing funds, which are somewhat more limited," says Fouladpour. "With this reorientation in marketing, we want more customer contact."

In a statement scheduled to be released today, June 11, Porsche says that over the past two years, it has cut by half the number of U.S. shows where it exhibits.

"We need to look beyond the traditional consumer auto shows - even ones that are highly renowned in the industry," David Pryor, Porsche's vice president of marketing, says in the statement. Like many automakers, Porsche has increased its emphasis on event marketing.

Rod Alberts, executive director of the Detroit show, says Porsche's decision came as a surprise. Other companies, such as Kia, have pulled out in the past and then returned, he says.

Because space is limited at the Detroit show, automakers that pull out give up the location they have had for years.

Alberts says that means that if Porsche decides to return, it may end up - as Kia did - in the basement for several years.

[mdxtasy]

I can't agree/disagree with that decision....based on the numbers in the article, putting on a display for such a small sales figure is not a great cost/benefit return.  The NAIAS is big, but it is very heavy on domestic unveilings.  Porsche will still be at LA, NY, Miami etc....so it's not like they're forgetting about the US.  They just target the market that will buy their cars. 

[wing]

But the Detroit show is not about the locals it is about the media and tradition.... odd Porsche apparently doesn't understand this.

[ovr50]

But the Detroit show is not about the locals it is about the media and tradition.... odd Porsche apparently doesn't understand this.

I thought the Detroit show was loosing it's clout? Not as important as before, and the location in Cobo (sic) Hall apparently is rotten. There are so many other shows now. 

[mdxtasy]

But the Detroit show is not about the locals it is about the media and tradition.... odd Porsche apparently doesn't understand this.

I thought the Detroit show was loosing it's clout? Not as important as before, and the location in Cobo (sic) Hall apparently is rotten. There are so many other shows now. 

Exactly.  I find the NY, LA, and others more in Porsche's tune.  Detroit has lots of domestic coverage....

[sirAQUAMAN64]

Porsche hybrid to cut Cayenne fuel usage by a third

Reuters |
July 23, 2007   

WEISSACH, Germany (Reuters) -- Porsche AG aims to cut the average fuel consumption of its Cayenne sport utility vehicle by nearly a third when it rolls out a hybrid version at the end of 2009, the company said today.

Porsche wants the Cayenne hybrid to require just 8.9 liters of petrol per 100 kilometers, or 26.8 miles per gallon, compared with the 12.9 liters its conventional Cayenne guzzles, or 18.5 mpg.

Europe's automotive industry is facing ever more stringent carbon dioxide (CO2) guidelines from regulators eager to curb greenhouse gas emissions.

The European Commission plans new rules by mid-2008 to reduce CO2 emissions from new passenger cars to an average 130 grams of C02 per km by 2012 through improved engine technology.

By comparison, Cayennes now exhale as much as 320 to 378 grams per km depending on the model, according to data from German automotive market researcher DAT.

Porsche is working with Volkswagen AG and Audi AG to develop hybrid powertrains that capture energy from braking. A battery then drives an electric motor alongside a petrol engine.

The so-called parallel-full hybrid lets the vehicle drive on electric power alone at speeds up to 120km per hour, or 74 miles per hour, with the combustion engine taking over at higher speeds.

Porsche said it would offer a hybrid version of its planned fourth model, the four-door Panamera coupe, but it does not plan to do so for either its Boxster/Cayman model line or its 911 sports cars.

[sirAQUAMAN64]

http://www.canadiandriver.com/news/070926-2.htm

Porsche lowers 2008 pricing over 2007 levels for Canada

Atlanta, Georgia - Porsche Cars North America Inc. has announced that it will lower prices in Canada by more than 10 per cent on its 2008 models, compared to prices and standard equipment on its 2007 line-up.

"We cannot ignore our customers and dealers in Canada who can look to the U.S. and recognize a substantial price difference," says Peter Schwarzenbauer, President and CEO. "We listened to the market and did what is best for our customers in Canada."

Porsche will lower the MSRP of its 2008 models by an average of more than 8 per cent; additionally, on an average equipment adjusted basis, 2008 models will offer another 2 per cent in savings from 2007.

[sirAQUAMAN64]

Porsche 2006/07 fiscal-year profit tops 4 billion euros


Automotive News Europe
November 12, 2007 -- 16:00 CET   

FRANKFURT (Reuters) -- German sports carmaker Porsche made a record profit of more than 4 billion euros ($5.88 billion) in its 2006/2007 fiscal year, the German newspaper Frankfurter Allgemeine Sonntagszeitung reported.

Porsche's sales were 7.4 billion euros, the newspaper said.

In the previous fiscal year to July 31, 2006, Porsche's pre-tax profit was 2.11 billion euros on sales of 7.27 billion euros.

[mdxtasy]

Here's some money for the VW brand....keep the change.  

Wow....Porsche seems to be on a roll. 

[G35X]

4 billion euros pre-tax profit on sales of 7.4 billion euro?   54% gross profit?  Very good business!  For comparison, Toyota is to make about 16 billion euros pre-tax on sales of 160 billion euros this year, which is considered excellent in this highly competitive industry.  There are cars which people are willing to buy knowing there is a fat markup on them, while there are cars which manufacturers cannot move even at give-away prices.

[mdxtasy]

4 billion euros pre-tax profit on sales of 7.4 billion euro?   54% gross profit?  Very good business!  For comparison, Toyota is to make about 16 billion euros pre-tax on sales of 160 billion euros this year, which is considered excellent in this highly competitive industry.  There are cars which people are willing to buy knowing there is a fat markup on them, while there are cars which manufacturers cannot move even at give-away prices.

I think the profit margin on a Porsche is extremely high, possibly highest in the mass produced auto industry.

Porsche sells dreams, not cars.  They do very well at that and their ads reflect that.

[JSCC]

4 billion euros pre-tax profit on sales of 7.4 billion euro?   54% gross profit?  Very good business!  For comparison, Toyota is to make about 16 billion euros pre-tax on sales of 160 billion euros this year, which is considered excellent in this highly competitive industry.  There are cars which people are willing to buy knowing there is a fat markup on them, while there are cars which manufacturers cannot move even at give-away prices.

"Because there's no substitute" 

[ghost]

I think the profit margin on a Porsche is extremely high, possibly highest in the mass produced auto industry.

Porsche sells dreams, not cars.  They do very well at that and their ads reflect that.

Yup. I read that Porsche is the most profitable car maker in the world. It's a whiz!
Not surprising considering the 911 is largely unchanged from generation to generations. the interior's still very 996! all the tooling has been paid for. Gotta love the business model.

[Allen]

Porsche revs up to expand Canadian business
GREG KEENAN

From Wednesday's Globe and Mail

February 13, 2008 at 1:08 AM EST

Porsche AG is set to announce a major expansion of its operations in Canada Wednesday, including the appointment of a president of Porsche Cars Canada Ltd. who will report directly to the company's head office in Germany instead of the U.S. office in Atlanta.

The luxury auto maker is boosting its staff in Canada to about a dozen people from the current four, sources said, and is likely to do more Canadian-focused marketing and sales.

“They feel they have to have a direct presence in the market,” said one industry source familiar with the announcement, which is scheduled to be made Wednesday at the Canadian International Auto Show in Toronto.

The Porsche move follows a similar action taken earlier this year by Volkswagen AG, which combined the Canadian operations of that auto maker and Audi into Volkswagen Group Canada and appointed John White to the top job after having been without a president in Canada for several years.

Spokesmen for Porsche at the head office in Stuttgart and in Atlanta would not confirm any details of Wednesday's announcement.

Sales of 1,987 vehicles in Canada last year – a jump of more than 50 per cent so far this decade from 1,288 in 2000 – rank this country among the top 10 Porsche markets worldwide.

The Canadian operations generated revenue of €120.2-million ($175.5-million) in the fiscal year ended July 31, 2007, according to Porsche's annual report.

Some dealers applauded the move, noting that it will allow them to talk directly to Stuttgart without having to go through the U.S. office.

Different approaches are needed in the Canadian market, some dealers said, even though the company is selling the same vehicles in Canada and the United States. Mass market auto makers are forced to tailor their selling tactics to Canadians who buy more subcompact and compact cars than Americans.

Porsche sells the Boxster, 911 and Cayman cars in Canada, but its sales got a big jolt earlier in the decade with the introduction of the Cayenne SUV, which has become its best-selling model.

The auto maker was the first to lower its prices last year to address the price gap that arose between Canada and the United States when the Canadian dollar was rising to parity against the U.S. currency.

With transaction prices that average around $100,000, “we were feeling it more than anybody,” one dealer said.

[JSCC]

Sounds like good news for the Canadian market. 

[Allen]

Porsche taking control of VW, Scania
MATT MOORE

Reuters

March 3, 2008 at 1:18 PM EST

GENEVA, STOCKHOLM — Ferdinand Piech made two giant strides on Monday towards forging a global automotive empire by gathering Swedish truck maker Scania AB into the arms of Volkswagen AG and preparing Dr. Ing. HCF Porsche AG in turn to take control of VW.

The bold strokes position Mr. Piech – the 70-year-old Volkswagen chairman whose Austrian family controls Porsche – as the architect of a group making everything from small cars to luxury autos and heavy trucks.

VW will take majority control of Scania in a $4.4-billion (U.S.) deal that brings it a major step closer to its goal of creating Europe's truck market leader along with German rival MAN AG.

The move to buy out Sweden's Wallenberg family ends a paralyzing stalemate over the future of Scania since early last year when it fended off a hostile bid from MAN, in which VW, Europe's biggest car maker, owns 30 per cent.

The two sides had made scant progress on a friendly deal being pushed by Mr. Piech.

“This is a major step forward for all parties involved,” Volkswagen chief executive officer Martin Winterkorn told a news conference in Stockholm, stressing that uncertainty over Scania's ownership had finally been laid to rest.

“One could say that the company has been in play since January, 1999. That is a very long period,” Scania CEO Leif Ostling added, referring to a bid from AB Volvo that fell foul of European antitrust regulators.

The market had barely digested the surprise news when Porsche said it was moving ahead with plans to increase its 31 per cent voting stake in VW to a majority, but did not intend to merge the two car makers.

At an extraordinary meeting, Porsche's supervisory body authorized the long-awaited move, which the maker of 911 sports cars and Cayenne offroaders said would represent an additional investment of almost €10-billion ($15.17-billion).

“Our aim is to create one of the strongest and most innovative automobile alliances in the world, which is able to measure up to increased international competition,” Porsche CEO Wendelin Wiedeking said.

Lifting its stake above 50 per cent would not require Porsche to make a full bid for VW because it made an offer at the legal minimum price last year which few investors took up.

“We still believe that in the long run we will see a Porsche holding with three pillars: sport cars (Porsche), cars (VW) and trucks (VW/MAN/Scania),” DZ Bank analyst Michael Punzet said in a note to clients.

He thought the timing of Porsche's move aimed to strengthen its hand while Berlin debates a new VW law that would preserve a strong say for employees and VW's home state of Lower Saxony.

Europe's highest court last year struck down the old German law that capped individual shareholders' voting rights in VW.

Scania's more-liquid class B shares surged at first but ended down 8.3 per cent after Volkswagen's finance chief said VW did not envision buying out Scania's remaining shareholders.

Porsche shares gained 2.4 per cent, while MAN stock advanced 4.3 per cent, making them the top gainers among German blue chips.

Volkswagen will pay 200 Swedish crowns ($32.44) per Scania A share – a 17 per cent premium to Friday's closing price – for a total of 26.94 billion crowns ($4.36-billion) to raise its voting stake in Scania to 69 per cent from 38 per cent. The deal is subject to regulatory approval.

MAN's hostile €10-billion-plus takeover bid for Scania, launched late in 2006, had sparked opposition from Mr. Ostling, who had to apologize after likening the approach to a German “blitzkrieg” even though a Swede runs MAN.

Both Volkswagen and the Wallenbergs rejected the deal.

MAN pulled its offer in January, 2007, and the three large shareholders resolved to work towards a friendly merger.

Unlike larger truck makers Volvo and Daimler AG which can extract economies of scale, Scania and MAN need to work together fast to save costs on the development of new lower-emission truck engines, analysts have said.

A MAN spokesman welcomed the Wallenberg family's decision to sell the Scania stake, which has been a key part of its Investor AB investment vehicle since its inception more than 90 years ago.

“We see the chances improving for collaboration,” the MAN spokesman said, adding it was too early to guess how the two truck makers might forge an alliance with Volkswagen's own commercial vehicles business.

[Allen]

Magna unit to build Porsche Boxster, Cayman
The Canadian Press

June 26, 2008 at 8:33 AM EDT

STUTTGART, Germany — — — — Porsche AG has chosen the Magna Steyr division of Canadian auto parts maker Magna International Inc. to assemble its Boxster and Cayman luxury sports cars.

The German carmaker said Thursday it will continue its arrangement with Finnish manufacturing partner Valmet Automotive until its contract expires in 2012.

After a call for tenders, Porsche chose Magna's Austrian assembly division as its future contract manufacturer “because it submitted the most financially attractive offer, and because it is in a position to take on development tasks for Porsche sports cars.”

The financial terms of the agreement were not made public.

Porsche deputy chairman Holger Harter said Valmet has built more than 200,000 Porsche cars “of outstanding quality” over the past 11 years, but “it was the high development capacity and competence of our future partner that tipped the balance in favour of our new partner.”

From 2012 onwards, production of mid-engine Boxster roadsters and Cayman coupes which exceeds the capacity of Porsche's own Zuffenhausen factory will be done at Magna Steyr's plant in Graz, Austria.

Porsche will supply the engines and various components, but “synergies arise from the numerous supply relations between Porsche and the Magna Group” which already provides significant parts to Porsche.