Porsche beauties display their brawn

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: Picture this. As misty clouds romance the Western Ghats at Amby Valley in Maharashtra and the sun shies away from the speed rockets of German sports carmaker, the motoring enthusiasts had the time of their life. Porsche AG has come wooing the Indian elite, with the biggest marketing spent in the country, at the recent Porsche World Road Show (Nov 14-23).

The road show saw a line up of beauties from the Porsche stable, from Boxster, Cayman, 911 (with Porsche’s latest technology in direct fuel injection engines and double-clutch gear box Porsche Dopplekuplung) to the top dog Cayenne series.

An investment of roughly $300,000 went into shipping 18 models that were part of the road show. Missing from the lot were the 911 GT2 and GT3, the real track honchos. “India does not have a huge motor racing history and felt it will not be appropriate to get them here,” explained Rod Wallace, managing director, Porsche India. Adding that if the motor racing culture picks up in the country it would open the market further. “We know that sports car is a growing sector,” he said, correcting that when in other parts of the world the ratio is 50:50 between its sports cars and SUV, it will not be the case in India.

Though Porsche has a long history globally, in India the brand is in the embryonic stage. It entered the Indian market very late, in March 2007. In the first year of operation, the company has sold 101 cars, a fair number to attain considering the kind of price tag these cars wear on them—between Rs 52,87,000 and Rs 1,34,79,000 (ex-showroom).

For this year, the company targets to sell double the number of cars it sold last year. “We are looking at not an explosive growth but a stable one. However, the ongoing brand revolution in India in the fields of fashion, electronics and automobile space is an impetus to the potential market,” said Wallace. There was a time when luxury brand meant Mercedes-Benz in India. But the market is picking up now, we have all the major brands—BMW, Volkswagen and Audi selling products here, said Manish Khurana, automotive analyst at Datamonitor India.

Like in the other markets, the company’s sports utility vehicle (SUV), Cayenne, is the most popular in India. Cayenne saw a global sales growth of 47% in the first ten months of 2007-08 (Aug-May) to 37,258 units. But the company’s classic 911 sports car series sales dipped by 15% in the first ten months of the fiscal year 2007-08 to 26,614 units over the previous fiscal year. This fall in sales is related to the life cycle of the product series. The standard variants of the 911 Carrera were launched in the market almost four years ago and are soon to be replaced by the new model generation, which is likely to increase the sales of the 911 sports car, analysts said. “New models like the Cayenne GTS, the 911 Turbo Cabriolet and the 911 GT2 are likely to contribute to the continuing success of the company along with the continuing economic growth in the markets of the future—India, China, Russia and the Middle East,” said Ramchandra Naik, company intelligence, Datamonitor India. Further, the launch of the four-door coupé Panamera, fourth model series of the company, is seen to change the image of the brand. Panamera will make a world debut in spring 2009 and the first models to be at dealers worldwide in late summer of next year. It will be priced similar to 911range.

Though Porsche believes that it is not in the business of selling hundreds and thousands of cars like any other mass market car manufacturer, hence not trapped in the current global economic downturn, Wallace hinted on the rising concerns at the headquarters in Stuttgart. The company that sold 98,652 units in 2007-08 feels that it may not see the same numbers this year (2008-09) as its major markets, including the US, Europe and China, are showing signs of a dip in demand. “The luxury car makers globally will see an impact of the current economic downturn,” said Wallace. A customer in Europe is concerned about what will happen in the future, and will defer buys for the time being, said an analyst.

Though Porsche’s sales improved to 28,267 units in the first ten months of the fiscal year 2007-08 in the US from 27, 682 units, sales dipped by 5% in Germany to 10,448 units. Outside Porsche’s main markets Germany and the US, unit sales in the geographical region referred to as rest of the world’ rose by 6.1% to 43,310 vehicles. The impetus was provided by the Middle and Far East as well as Eastern Europe. Sales in China have been growing by over 150% in the current fiscal and the company plans to sell 8,000 units this year.

Porsche is eyeing majority stake in VW by early next year with full control over strategic decisions and VW’s profits next year by raising its stake above the 50% threshold. Porsche chief executive Wendelin Wiedeking has reportedly reaffirmed the carmaker would take its VW voting stake to 75% at some point in 2009. That could see more action from Porsche in the emerging markets.

The Amby Valley road show signifies the company’s focus on the large emerging markets. “Our strategy will be to establish the brand in the market and expand the dealership network in the country. The road show is one such step in this direction as if you don’t put down the foundation properly then it will lead to a fall over,” said Wallace. Currently, the company has two dealerships in India, in New Delhi and Mumbai. It plans to open dealerships in Ludhiana, Hyderabad, Bangalore and Chennai in the next few months. Punjab is a very strong focus region for the company.

Porsche started organising the Porsche World Road Show in 2004, the first being in Norway. The road show goes around the world with the same vigour and enthusiasm. In India, the road show witnessed the presence of the members of the media and around 300 customers with local sales people at the site. Like in other countries, the road show saw four professional instructors from Germany, Austria, Belgium and Switzerland helping our the gathered enthusiasts learn the driving techniques of off-roading, braking, handling and slalom. The cars that joined the sport were the Boxster S and Cayman S (295 hp/ 0-100 kph in 5.4 seconds), Cayenne GTS (405 hp/ 0-100 kph in 6.1 seconds), 911 Carrera S (385 hp/ 0-100 kph in 4.7 seconds) and 911 turbo (480 hp/ 0-100 kph in 4 seconds).