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NEWS
Porsche customers appeased
Sales up in May despite ‘serious grievances' from some buyers in the lead up to big Porsche price cuts from JunePorsche Cars Australia says it has successfully resolved the vast majority of complaints from customers who purchased a new vehicle in the lead-up to hefty price cuts announced on April 23.
Speaking at the launch of the redesigned Cayman coupe (pictured) in Sydney yesterday, managing director Michael Winkler said Australia’s 12 Porsche dealers had received about 50 compensation claims following last month’s announcement that prices would be cut by as much as $36,000 from June 1.
Of those, he described only 20 per cent as “serious grievances” but said all affected customers had now been compensated.
“Since we announced we’d have a process in place for customers to address their concerns we’ve had about 50 such concerns, 40 of which were of a very minor nature in terms of financial impact,” he said.
“About 10 customers had what I would say was a serious grievance – in one case a particular gentleman paid full price for a Carrera 4S two days before the announcement.
“Naturally we took care of those people and resolved those cases without question. In each case we worked with the dealers and we were able to make the customers happy in all cases. I’d like to think that all 50 complaints were dealt with satisfactorily for all parties.
“I don’t anticipate too many more now coming out of the woodwork. We’ve dealt with it – it’s done and finished”
Winkler said recent Porsche buyers were offered a range of financial incentives including better trade-in deals to compensate them for missing out on price cuts of between $5500 for the most basic Boxster (now $101,500 plus on-road costs) and $36,300 on the top-shelf 911 Carrera 4 Cabriolet (now $244,600 plus ORCs).
“What we did do was take a look at the individual transactions and all aspects of the account, to make sure the actual transaction prices – including an over-allowance on the trade-in – exceeded the price reduction in the first place.”
Porsche said it also compensated its dealer network by adjusting the prices paid for unsold vehicles in their inventories, except demonstrators already registered.
“What we did with the dealers, we went through their inventories that they had unregistered at that point in time and we asked the dealers to make a contribution in as much as the loan cars they had registered they had to worry about adjusting themselves,” said Winkler.
“I had all 12 guys around the table when we discussed that – no one was disappointed by that given it was a fair arrangement with the potential to obviously have a positive effect on sales going forward. All 12 dealers think it will be good in the long run.”
Winkler said that although it did not become official until June 1, Porsche’s new Australian pricing structure was implemented immediately. In combination with recent new models releases, the result was a sales spike of about 30 per cent over the same month last year to more than 150 registrations.
“What we did covertly was we adjusted the pricing the minute we made the announcement -- it was already in effect in May and from June dealers will be advertising those new prices.
“We’ve had a very good May order intake. Statistically one month doesn’t make a year and I don’t necessarily see any causality between the repricing and this uptick because we’ve had a better first quarter in any case, simply on the back of new products in the marketplace -- so be careful not to link one with the other. Overall this year has been considerably better than last year and May has been particularly good.”
Winkler, who has long criticised the federal government’s punitive luxury car tax, said Porsche decided to cut prices to remain competitive following price cuts by its most direct competitors – not as a result of the strong Australian currency, which makes imports cheaper.
“We believed there was room for optimisation,” he said. “The fact is the value proposition in Australia is changing and you have to meet that. We’re now in line with where the opposition is.
“Our treasury is managed internationally. It’s managing a basket of currencies against each other so there’s a fair degree of stability there. And don’t forget when the dollar was very weak we didn’t raise prices. We took the pain when we had to and we took the benefit surely in the last couple of years, but over time I think we’re fairly positioned.”
He said the hefty price cuts were preferable to a number of smaller reductions over time or adding equipment that many customers did not want.
“It wasn’t slash and burn. We could have done it in dribs and drabs and added equipment but that approach was rejected for the simple reason the cars are already well equipped and anything you would choose to add would only meet the desires of 50 per cent of customers.
“So it’s better than packing more stuff in the cars that people don’t want in the first place. We decided a price readjustment was the best way to deal with the movement in the market overall and I guess it’s a more honest approach than trying to hide the fact that you’re doing something there.”
Winkler said that a “measured approach” to price cuts would minimise the impact on residual values of used vehicles.
“Obviously the market overall had become more competitive and we felt that a measured approach minimised the (impact on) resale values going forward.
“Remember these things are not whitegoods like refrigerators – you move them up, down or sideways by 30 per cent and because these cars are financed you’re really wreaking havoc with your customers’ finance arrangements.”
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Written byMarton Pettendy
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