KARL MEYER
With major manufacturers rolling back their investment plans for EV production, and with some of the premium EV scene’s biggest names seeing their market value obliterated, should buyers who have placed an order for a second-gen Taycan or Macan EV be questioning their decision?
With the first ‘24-plate Porsches successfully delivered into traffic, March 1st presents a significant data point for those of us interested in the business of buying and selling Porsches. March and September provide us with a banquet of relevant numbers, including the volume of orders taken, part-exchange prices, new conquest business and the renewals of happily returning customers. Whilst working my way through this information, I couldn’t help think how different such a task would have been for observers of the once super-niche Porsche scene back in the 1970s and 1980s. With the best part of fifty Porsche Centres in the UK today, and with a seven-car product line-up incorporating a multitude of body and trim configurations, Porsche is now a behemoth of a business. It’s sobering to note the company is far bigger today than many high-volume manufacturers were forty-plus years ago. With increased operational size and production, however, comes much change for Porsche.
The need for Centres to look after first-time enquirers is greater than ever, but forces of risk and exposure for franchise dealerships is greatly multiplied, as seen in 2023. Naturally, a host of new pressures to maintain excellence in customer service standards when dealing with these new volumes is a challenge all dealers must strive to meet. As I read the numbers for new registrations and the corresponding daunting new sales targets for Porsche Centres, it’s worth remembering these changes are very recent. To me, growing pains in this new era for Porsche seems realistic. Hiring and training of new team members and building and investing in majestic dealer showrooms are just some of the challenges I hear about when speaking to dealer principals, not to mention the need for them to navigate the huge spend and learning curve associated with EV infrastructure. No prizes for guessing who ultimately pays the cost of all this new investment.
In the aftermath of last year’s nose-diving Taycan prices, EVS have become a hot topic of conversation in the Porsche world. In the last month, I’ve lost count of how many of you have contacted me to ask what you should do with your Macan EV order. My answer is simple: the Macan EV has the largest order book of any Porsche product in the company’s history. Demand is clear. I reckon this model is set to be a world beater, as indicated by the huge waiting time to ‘get on the list’. If you’re lucky enough to be on it, stay there until we have any evidence to suggest doing so is a negative. On this note, it’s worth stating the EV space is about to change.
Ford and General Motors have removed much of their investment in the space, openly admitting they can’t sell EVS in the numbers assumed. Honda and Toyota have remained agnostic. If this isn’t indicative enough, the court of public opinion has also spoken. In November 2021 (the height of EV fever), Fisker had a market cap of $6billion. Today, the brand is worth a comparatively paltry $200million. Faraday Future, another player in the premium EV game, was valued at $3.4billion. Today, the entire company can be bought for a mere $4million. Lastly, Lucid was valued at $72billion, but has since lost almost ninety percent of its worth, resulting in current valuation of $7billion. My interpretation of this data is more encouraging than those numbers might suggest, though.
Whilst it makes no sense to me that Faraday Future is worth only $4million, it’s important to be aware values were massively inflated in 2021. I also believe the EV space is an important one, I just never believed it was the ‘one size fits all’ solution to ‘green’ motoring we were told it had to be. EVS can certainly make up a decent percentage of the traffic on our roads, but with some of the biggest players now leaving the space with burned fingers, the premium EV market is left to Porsche, Tesla and, most likely, emerging Chinese brands. All gathered data suggests this is the case, which is great news for Taycan and Macan EV prices, hence me suggesting you keep your orders open.
A Porsche Centre technician made a fantastic observation worth sharing. Many parts for EVS are manufactured in countries experiencing political instability. With lengthy lead times and spiky price rises, EVS have left insurers exposed (think escalating hire car costs and lofty repair bills). I can attest to seeing EVS being classed ‘beyond economical repair’ where I am convinced their ICE counterparts would be saved. This is something worth keeping an eye on — insurance premiums crept up in 2023 and have a habit of influencing automotive retail prices. It’s tough reality for all of us in the world of Porsche sales, but despite affected margins, we are all very happy to see activity finally returning to something resembling normality. For now, at least, the Porsche motor trade it is finally back to ‘business as usual’. ●