Porsche, which can't be sold: old money doesn't love, and the new upstart doesn't hurt

Jiang Jie observed that when she entered the industry, the people who bought Porsches were all pioneers, "after all, at that time, those who spent millions of yuan to buy a car were still considered rich." Now, more people who buy Porsche are people who look up to the rich, such as "Internet celebrities, micro-businesses, and medical beauty", and some corporate executives, and more than half of the car owners are women.

The title of "the most cost-effective luxury car" once made it invincible in the market. But now, those who really have spending power may choose more upward brands, such as Bentley and Rolls-Royce. And those who were able to come to Porsche before are getting farther and farther away from the brand.

Text | Wang Xiaojuan

Edit | Shinno

Operations | potato

Even the Porsche didn't work

“22款卡宴GT优惠28点起”，“保时捷Taycan GTS、Taycan Turbo S，优惠25点，可谈”。

In mid-December last year, a luxury car salesman shared the latest discount plan for some Porsche models on Moments. Although the specific situation of different models and stores is different, in his impression, this is the largest discount margin for Porsche in China for more than 20 years.

In the past, "you can't buy it at a higher price" was once one of the proudest labels on this luxury brand. In the era when sales are on the rise, if you want to buy a Porsche, in addition to the model, the optional budget is indispensable - SC (Sport Chrono) package, sports exhaust, Bordeaux red interior, BOSE audio, 21-inch large wheels, panoramic sunroof...... The price of each option ranges from thousands to tens of thousands of yuan, and a set of them can add a car just by increasing the price.

In the eyes of Porsche fans, a car without an option is no different from a rough house, and few 4S stores will sell a naked car without any options. But in 2023, the situation has changed dramatically.

The margin of preference is pulled up little by little. Jiang Jie, a salesperson at a Porsche 4S store in Guangzhou, remembers that before 2022, price reductions were not common, and in the first half of 2022, consumers could talk about discounts of about five points, and at the end of 2022, some dealers began to shout out ten points. By 2023, a dozen or twenty points are already quite common. With the exception of the 911 series, which remained firm, all other models were discounted.

▲ Porsche 4S shop. Photo / Visual China

The requirements for price increase options are also getting lower and lower. When the market is good and there is no worry about selling, the Porsche Cayenne handled by Jiang Jie has a minimum of 200,000 yuan for one option, and the Paramela is even higher, 240,000 yuan. From the end of 2022, this standard has been cut in half, and there is no mandatory requirement, which can be considered in conjunction with customer needs.

In the used car market, Porsche was once a luxury model that held its value. Nowadays, you may only need to spend two or three hundred thousand yuan to get an entry-level Porsche - for example, a Porsche Macan with a landing price of 698,000 yuan in 2019, with a mileage of about 40,000 kilometers, and a second-hand car dealer quote of 378,000 yuan, "the price is negotiable".

Push the time of buying a car further back, and the number can be lower. A Porsche 718 that landed around 2014 "has recently (fallen) to the level of 200,000 yuan". Car dealers who are familiar with the second-hand luxury car market told everyone that the lower the price of the model, the more people come to inquire, and the faster it always sells, and for car dealers, "one price a day, the longer you stay in the handcar, the greater the possibility of losing money".

Even Paramela, who was out of the circle with her appearance and couldn't buy it at a price increase, couldn't bear the decline. Another second-hand luxury car sales revealed that the new car is about 1.3 million yuan, and the Paramela has been on the ground for a year, and now the price of the second-hand car is about 1 million yuan, which will fall by 300,000 yuan in a year, and will be adjusted with the price fluctuations of the new car.

▲ Porsche Paramela. Photo / Porsche's official Weibo

In the midst of the turmoil, Porsche handed over a sales report shrouded in gloom. According to the data, in the third quarter of 2023, Porsche's total deliveries in China were 16,900 vehicles, a year-on-year decrease of 40%, and in the first three quarters combined, Porsche delivered a total of 60,700 vehicles in China, a year-on-year decrease of 12%.

As a comparison, Porsche's global sales in the first three quarters of 2023 were 242,700 units, a year-on-year increase of 10%, of which the North American market increased by 14% year-on-year, the European market (excluding Germany) increased by 23%, and the German market increased by 19%.

At the micro level, this downward trend in sales has become concrete. Song Yan, who once worked in a Porsche 4S store in Shandong, said that around 2017, the monthly sales of a single store were 50 to 60 units, but recently, Song Yan learned from a former colleague that he could only sell about 20 units a month, and the sales volume was not as good as before.

The pressure is transmitted layer by layer, and finally reaches the first-line sales. Fortunately, Jiang Jie has accumulated a large number of customers in the past, and more than 60% of the daily orders come from the recommendation of old customers, and she has not obviously felt the pressure on the business for the time being. However, the scope of her work has changed, and since November she has been working in the company's "Pre-Owned" department, selling official used Porsche cars.

For newcomer salespeople who haven't accumulated many customers, they are currently experiencing unprecedented pressure, and most of the time at work, they are making countless rejected phone calls. "If you don't have an invitation tomorrow, you won't be able to leave work. Jiang Jie introduced, "Many leaders (management) are from BBA, and they will directly move the original set used to open people." ”

Song Yan worked at Porsche for five years before resigning from Porsche at the end of 2022 due to income, prospects and other considerations. It was also in that year that Porsche's sales in the Chinese market fell for the first time in many years – by 2.5 percent year-on-year. At that time, Song Yan thought about going directly to new energy, but there was no suitable opportunity, so he worked as a sales manager in another joint venture car company for more than half a year. Until the second half of 2023, Ideal opened a central store in his city, and the timing and salary were right, so he decisively switched to Ideal.

"The most cost-effective luxury car", why isn't it fragrant?

In the hearts of Chinese luxury car consumers, Porsche has always had a unique temperament.

On February 15, 2001, Porsche's first official sales store was located on Chang'an Avenue in Beijing. The decoration of the store is very Chinese-style, with red pillars and glazed yellow tiles, and the red English letters "PORSCHE" are very conspicuous. This marks Porsche's official entry into the Chinese market.

▲ Porsche's first official sales store. Photo / Porsche's official website

This year marks Jiang Jie's 17th year with Porsche. In her memory, in the first few years of entering the Chinese market, Porsche's main sales model in China was the Cayenne, and "most of the people who walked into the [Porsche] showroom bought the Cayenne". In 2007, Porsche sold 4,179 units in Chinese mainland, of which 84% was contributed by the Cayenne.

At that time, Porsche's production capacity was limited, and sales in the Chinese market were in short supply. Jiang Jie recalled that around 2012, ordering a Porsche Cayenne would not only have a number of personalized customizations, but also a waiting time of up to two years.

The turning point came shortly after. Based on the global success of models such as the Cayenne, Porsche has built a new plant near its Leipzig plant in Germany at a cost of 500 million euros. The new plant has an annual production capacity of 50,000 units and started full-scale operations in February 2014. Since then, the waiting time for models such as the Cayenne has gradually decreased, and most models now only have to wait about 5 months.

The increase in production capacity kicked off Porsche's growth in the past decade. Until 2021, Porsche's sales in the Chinese market continued to grow. As of 2022, the Chinese market has been the world's largest single market for the Porsche brand for eight consecutive years, once accounting for 30% of its global sales.

▲ Porsche production base in Germany. Photo / Visual China

Porsche's popularity has nothing to do with its positioning. A number of salespeople and car owners said in interviews that Porsche's price band is higher than BBA, but lower than Bentley, Rolls-Royce and other ultra-luxury brands, which is the first choice for BBA owners to upgrade their consumption. "(Porsche is) a very cost-effective luxury car", Jiang Jie sighed, this positioning once had no rival in the market.

But after so many years, the main consumers have also changed. Jiang Jie observed that when she entered the industry, the people who bought Porsches were all pioneers, "after all, at that time, those who spent millions of yuan to buy a car were still considered rich." Now, more people who buy Porsche are people who look up to the rich, such as "being an Internet celebrity, doing micro-business, and engaging in medical beauty", and there are also some corporate executives, and more than half of the car owners are women, Jiang Jie summarized this change as from "old money" to "new upstart". However, the current external environment has changed, and the income of this group is also more susceptible.

In the view of many practitioners, those who really have spending power may choose more upward brands, such as Bentley and Rolls-Royce. Those who were just able to go to Porsche before made a more prudent choice, thinking downward, and choosing BBA or NIO, Ideal, and Wenjie among the new forces.

The lag behind luxury car brands in the middle ground is also like the failure of light luxury - the real ultra-luxury luxury brands are still standing, and the middle class who can just afford light luxury may slip at any time and easily stop paying for them.

In the face of the decline in sales, Michael Kirsch, CEO of Porsche China, analyzed three reasons in an interview with the media: first, the Cayenne, the most popular model in the Chinese market, was affected by the switch between the old and new models, and the sales rhythm did not keep up; second, the price war in the macro market was extremely fierce; and third, the third was the allocation of a part of the Chinese market to other markets around the world.

▲ Porsche 911. Photo / Visual China

In the past year, the price war in the automotive industry has indeed burned from the beginning of the year to the end of the year, one after another. Porsche was also passively involved, and it affected its own sales.

Da Zhuang, a second-hand car practitioner, feels that Porsche's sales fell sharply in the third quarter last year, which was affected by the price war in the industry. "Models such as the Audi A7, which is the benchmark for Porsche, have been reduced in price this year, and Porsche naturally has to adjust the price accordingly. After the adjustment, it may not necessarily bring new sales, "many people who buy these cars are not just needed, just like stocks, the more they fall, the more they don't buy."

But the third reason in Ke Shimai's mouth is more like a remedy after the decline in sales, after all, the terminal is still reducing prices, indicating that dealers still have inventory pressure.

In the new competitive situation, many Porsche sales have made new choices.

In the view of Song Yan, who jumped to the ideal, Porsche's car sales cycle is longer, which means that it takes longer for sales to get commissions, and the income treatment has declined compared with when he entered the industry. At present, the new forces have a higher base salary, and they can get commissions by locking orders, which also makes sales more motivated.

Many of Jiang Jie's peers who used to be in luxury car brands have also switched to high-end new energy brands, and she herself has several colleagues who "go to sell and look up". She can also feel that Porsche's appeal is indeed weakening. In the past, Porsche's sales were "the best of the best", but now, while the sales staff as a whole are younger, the elite salespeople also have more choices.

Some sales, which have accumulated customer contacts at Porsche for many years, are more likely to be poached by domestic new energy vehicle companies. "Many colleagues have been recruited to work as management positions in tram brands, and some have even become regional general managers," Jiang Jie said, adding that some luxury brands have invited her to come at a large price, but she felt that she would face new pressure, so she did not go in the end.

But she understands the choice of her colleagues, after all, from the sales staff to the management post, and then to become the store manager to manage a store, the sense of honor obtained is completely different from continuing to do front-line sales in an ultra-luxury brand.

Will the electrification transition save Porsche?

In the era of fuel vehicles, few domestic brands can directly compete with Porsche. But in the new energy era, this situation is being broken.

According to the data of the Passenger Car Association, from January to September 2023, the sales volume of fuel luxury vehicles with a starting price of more than 300,000 yuan was 1.66 million, a year-on-year increase of 13%, and the sales of new energy luxury vehicles were 580,000 units, a year-on-year increase of 89%. Judging from this data, although the overall luxury car market is growing, new energy has become the absolute main force of growth.

From the perspective of market segments, also from January to September 2023, the sales champion of high-end SUV models is Tesla Model Y, and the second and third places are Audi Q5L and Mercedes-Benz GLC. In addition, there are also ideal L7, L8, L9, as well as BMW X3 and X5 in the top ten. Porsche's Macan, which was once very attractive to middle-class Chinese families, has fallen behind.

▲ Porsche Macan. Photo / Porsche's official Weibo

In terms of product strength, domestic new energy high-end models also have the strength to wrestle with foreign brands, at least from the trend point of view.

When the Porsche Taycan was first launched, it was once one of the most expensive all-electric models, with a price tag of over one million. But entering 2023, looking up to the release of the brand, the U8 and U9 models are both at the million level. A number of Porsche salespeople said that many potential customers they had negotiated with had turned to look up. In the middle of 2023, Haobo, a brand of GAC Aion, also released the pure electric supercar Haobo SSR, with a price of 1.286 million to 1.686 million yuan, and the price jumped further.

These brands want to carve up Porsche's market share. And the strong opponent is Tesla, which can't be bypassed. In the past, Tesla Model S and Model X users had a lot of overlap with Porsche, and according to Musk, Tesla's new generation Roadster sports car is expected to be mass-produced by the end of 2024.

Dazhuang feels that it is not the specific new energy models of a certain brand that have seized the original market of Porsche, but that in the new energy era, the logic of buying a car has changed.

In the fuel vehicle market, Porsche is a predecessor, both in terms of engine and design. But in the new energy market, everyone has been pulled to a new starting line. In the purchase logic of new energy vehicles, users pay more attention to the vehicle itself than the brand, so the premium from the brand may weaken. When buying a car, more specific data such as battery life and intelligence level are compared, and perhaps a brand premium may be formed in the future, but it is not obvious at the moment.

According to Da Zhuang's observation, there are some people around him who have bought NIO ES8, Ideal L9 and other models, which turned out to be the owners of Range Rover and Porsche Cayenne, when they are faced with changing cars or buying the next car, they may have chosen Cayenne GTS, but after they came into contact with the models of these new forces, they found that the experience of these cars is also good, and it is very likely to turn to these cars, "It's not that the more expensive ones can't afford it, but these cars can already be satisfied."

A consumer who switched from Porsche Paramela to the ideal L9 admitted: "When I was young, I had a dream of a sports car and chose Palmer. Now that they are married, they are no longer part of Porsche's user group. And the Porsche car machine is not easy to use, and there is no exclusive after-sales customer service. The owner also blindly ordered the M9, the reason is that he Xi is used to the domestic new energy vehicle machine system, and "can't stand to drive and use the mobile phone holder to navigate."

The electric trend is rolling forward, and Porsche is not without a positive transformation.

Back in 2010, Porsche unveiled the 911 GT3 R Hybrid at the Geneva Motor Show, the first racing car in Porsche's history to feature a hybrid engine. At the 2015 Frankfurt Motor Show, Porsche presented its first all-electric four-seater concept coupe, the Mission E.

But apparently, for a long time, Porsche maintained its own pace. It wasn't until 2019 that the first all-electric Taycan was officially launched. At that time, the new power car companies in the Chinese market had already begun to deliver early models, and Tesla was officially produced in China, and the melee of new energy had just begun.

▲ Porsche Taycan. Photo / Porsche's official Weibo

The changes in the Chinese market have undoubtedly accelerated the process of Porsche in terms of electrification, and in terms of intelligence and electrification, Porsche is on par with China's new forces.

In an interview with the media, Ke Shimai said that compared with other markets of Porsche, the average age of Chinese car owners is the youngest, and the proportion of female car owners has reached the highest of about 50%, so Porsche is very concerned about the preferences of the new generation of young customers. "For example, they have a stronger need for connected and digital vehicles. Personally, I think that China's electric vehicle products have done quite well in terms of appearance, quality, and driving performance, and are far ahead of the global market in terms of in-vehicle interconnection, digitalization and intelligence. ”

In 2024, Porsche's electrification transformation will focus on the Macan. Recently, the mystery of this car is being lifted little by little, and it is obvious that this car has made some efforts in intelligence - adding a co-driver entertainment screen and a large-size AR-HUD head-up display.

In the coming years, many of Porsche's models will also be available in electrified versions, such as the all-electric version of the 718 and the all-electric version of the Cayenne. In the longer term, Porsche aims to convert 80 percent of its new car sales to all-electric models by 2030.

But at the moment, the transition doesn't necessarily work quickly, after all, the people who buy a Porsche don't seem to be aiming for electric energy as an energy source.

A number of Porsche owners said that they still want to choose their fuel vehicles when they buy Porsche, which is also more in line with the sport and handling advocated by the brand, and I don't know if these dimensions can be replicated in electric cars. An owner who bought the Taycan said that if it weren't for the license plate restrictions, he would definitely choose a Porsche fuel car.

After the transition to electrification, Porsche is pinning its hopes on more young consumers to shoulder their purchasing power. Jiang Jie introduced that most of the buyers of Porsche electric vehicles are young people, "parents who have been exposed to fuel vehicles for decades still find it difficult to understand spending millions to buy an electric car", but young people are more likely to accept and try, "there are many international students who persuade their parents to buy".

However, whether this strategy can be effective in the long term depends on whether Porsche can withstand the pressure and continue the legend of the era of fuel vehicles.

(At the request of the interviewee, the names in the article have been changed.) ）

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