Originally Posted by
Pando
Not really, but if you want to simplify it even more:
A company not making profit is not going to be in business for long, the Product Y (Cayenne from now on) carries profit to Company X (Porsche form now on), hence it is a good idea to produce the Cayenne.
But Porsche WERE making profit
What I was never able to find when it launched whas what "written off costs" were being used i teh Ceyenne startup.
A failry common approach when moving into a new business is to do as much of teh developmetn and investment in a factory and then mvoe the productino to a NEW factory. So then legitimately writing off the investment and guaranteeing to make the new subsidiary VERY profitable (on paper). ( HP did this all the time with new division startups in new business areas )
But it's not that simple. You raise some very intersting speculations about what Porsche could've produced instead. But does one idea really cancel the other out? If Porsche presents a profitable soccermom-car that ties down a certain of the engineers for a certain amount of time, does that mean they cannot "focus" on another project now or in the near future? I get the impression you feel a SUV removes more "focus" from other projects than another more enthusiast-accepted project.
We are accepting we are WELL into the world of what-ifs and any one of a million other possibilities exit ?
OK ... my conjecture is that the handling and complexity in an SUV are different from a sports car for the reasons that OFF-ROAD performacne was never a trait in Porsche AWD design ( except the unique 959 Dakars of course ) Body requirements are different. Accomodation needs are different. All things Porsche didn't have.
Now the odd player out I've forgotten about up till now is the VW Toureg team input. It's possible Porsche used them to do all THAT stuff and Porsche engineers worked on teh bits htey are good at and thus less "dead time" while they "learned".
) If Porsche would start a completely new large scale project building light track cars for the private market, to compete with Radical's and Ariel's it would also slow down the development of other models.
But by significantly less as the processes they would use woudl be the same as they have done in making the Lightweight GT3 versiosn and the competition Cup cars. I dont' think that woudl make much sense for them either tho. Bringing a car below the Boxter woudl be a difficult market positioning for the Boxter.
About the brand image, I agree with you. But as you said, the real worth of the image, aswell as a loss or gain is hard to measure. Has the mainstream image really suffered? Is it worth to jeopardize the way enthusiasts view the company for profit? At what price and conditions is selling out acceptable? If the SUV/Mainstream-profits are used to build an AMAZING Roadster/SportsCoupe/SuperCar in the future is it all forgiven?
Well the Cayenne's sales were dropping at the end of 2005 along with other SUV/crossovers.
The difficulty in getting IN to a market is being able to get OUT with yrou pants on !!!
So how long will they keep investing in the SUV market as it down-sizes. Will Porsche lose face if/when they exit ?
Will the Cayenne team move closer to cars as teh SUV/crossover moves smaller ?
At which point will the Cayenne team then be making a competitor to the Cayman ?
Dangerous stuff dillution of the market/
( We were also there with HP as we had two divisions in overlapping markets as technology evolved. Each addressing it in their own way. We came along and did it a thrid way and took over that niche. We were a vERY profotable division. BUT HP ended up spending 2/5 times what it needed to to win that market. If only those other two divisiosn realised and co-operated it would hve produced better solutions. )
Porsce are going to be there as the SUV gets smaller
Using the Prada/Gucci comparison, it isn't really like they started making a cheap plastic high street shoe, but rather started making a brand new clothing line for extra large people = still the same quality and price, but now for wider audiences who according to some don't really fit the Prada/Gucci image. (pardon the pun's)
Yeah good point, bad analogy
But I like yours ..... so what do all the fashion conscious "IT" people do when they see a bunch of fat 'ugly' people wearing the same as them ? An even better example than my original, Prada would lose nearly every one fo those big spenders who think thin is beautiful and spending $110Ks on plsatic surgery to be it
Another what-if could be, what if the Porsche executive's really had that crystal ball, looked into the future and saw them at the bringe of bankrupcy 20 years later unless they come up with something different to offer. No more Porsche vs a sellout-Porsche.
OR did Porsche management see BMW getting in to it and for national pride decide they had to too ?
The management press at the time talked long and hard about Porsche management NOT being in total agreement on the move and deliberating long and hard before moving.
The thing we can't tell is how much the VW relationship played -- it possibly DID allow Porsche to minimise it's risk on teh sportscar line ( but if it did WHY was the Boxter so piss poor at it's "update" )
But it's all speculation anyway, wouldn't it be interesting to know exactly how many sales Porsche have lost on other models because of the Cayenne?
Lots have tried
Some decided that a 911 owner would buy a Cayenne for his wife instead of a Range Rover or Toureg.
Some decided that some had bought the Cayenne as their Porsche instead of a 911 for him and somethign cheaper for her. So "he" got a more focussed performance car like an Elise or Radical or 7 instead of a 911.
I've seen more "analyses" in various places than Porsche's sold
It's one of those impossible things to find out in the market place without being able to exist in multiple universes
Good fun to speculate tho.
But as you look at the success of alternatives to 911s then it may suggest that that market has gone soft on 911s and is at risk. Did Porsche KNOW this was going to happen and decided to get into SUVs or did it happen BECAUSE porsche didnt' keep investing in sporstcars to compete. Are Porsche better off making X cars per year at 20% return on assets or Y cars in Z market making 10% ? NOW wer are in to company ethos. The companies I've worked for were always driven by return on assets, so if a market coulnd't get us above our threshold then we got out -- and sometimes farily quickly !!
"A woman without curves is like a road without bends, you might get to your destination quicker but the ride is boring as hell'