The endless list of options on Porsche’s online configurator is not just fun to play with. It’s also highly profitable for Porsche and, along with special editions and luxury equipment, is a major source of profits on which Porsche depends for future success, according to the company’s initial public offering prospectus released on Monday.
A prospectus is a document issued along with the IPO that describes the company’s operations in depth along with the terms of the IPO and anything else they want to tell investors who are interested in buying the company’s shares. For an automobile company, a prospectus often includes some ideas about recent and future products and the company’s overall strategy. Porsche’s flyer makes it clear loud and clear that they’ve taken the hot markets for GT car customization and paint-focused Instagrams on samples, and proudly states that they look to cater to discerning consumers.
Demand for Porsches Special Edition has grown in recent years, the newsletter notes, and Porsche wants to ride that wave all the way to the bank. “The share of cars with a selling price of more than €200,000 increased significantly between 2019 and 2021, in part due to increased deliveries of GT and Special Edition models and increased Porsche Exclusive Manufaktur penetration,” reads the prospectus.
The Porsche Exclusive Manufaktur allows customers to greatly customize their Porsche cars, sometimes working on limited-range models like the recent Porsche 911 Sally Special as well. The flyer calls the 911 Sport Classic – another special edition designed by Exclusive Manufaktur – as an example of a car that sold quickly with its limited run of 1,250 and a base price of $273,750, so it’s safe to say we can expect Porsche to play around with more with limited editions like it In the future.
However, the rollout also notes the success of its top trim and standard options list but remains long, noting not only the vast price difference between the base Porsche model and this model’s top lineup but also the overwhelming popularity of the additional options on top of that.
“On average, across the six model lines, there is a premium of more than 100% between the price of the entry model and the top model with price points in excess of €200,000 on select models,” states the prospectus. In 2021, only a minority of customers purchased entry-level models without more options and customization.
The flyer includes a pricing table for pricing each model in Germany that compares the price of the base model to the top model trim — for example, the standard Taycan price versus the Taycan Turbo S Sport Turismo, both of which do not include VAT and other options — and frankly, it’s wild.
This also holds true in the United States. The Macan is the cheapest model sold here and the least extreme example, starting at $57,500 before taxes, fees and options, but the top version of the Macan GTS starts at $82,900. However, the 718 model range is where it turns utter absurdity, with the base 718 Cayman starting at $63,400 before taxes, fees and options, and its top model, the 718 Cayman GT4 RS, starting at $149,100 — nearly three Double the price of the base car.
The wide range of models available along with this popular choice list have contributed significantly to Porsche’s profitability in recent years. According to the prospectus, sales of cars with more than $200,000 after options in the United States jumped 18% from 2019 to 2021. And in Germany, sales of more than 200,000 euros jumped 33% in the same time frame. In Germany, customers in 2021 paid an average of 20% more than the base MSRP of Porsche Options and Customization. This is the company that figured out how to get customers to pay to leave things out of the car, after all, but it’s crazy to see exactly how much Porsche buyers would pay to choose a new car exactly the way they want it.
So, while I personally would love to see a cheaper Porsche – the 944th Revival, anyone? – This preliminary prospectus shows that Porsche’s product strategy is focused on the other end of the market. If you’re annoyed that you missed the last limited-production 911 special, don’t worry—there will almost certainly be more of those, and they’ll probably encourage you to match their color to your cat’s.
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