Broadening the Appeal of Luxury VehiclesTue, 09/01/2015 - 15:04
Q: How do you communicate the prestige of Porsche to a Mexican audience?
A: The Porsche brand has deep roots in Mexico thanks to the performance of our cars during the Carrera Panamericana in the 1950s, which helped build the prestige of Porsche significantly. Back then, Porsche was a young car producer who was challenging the big, global and well-positioned brands, and the name embodied a radically different concept; these cars were built to be light, efficient, and agile. By the 1970s, Pedro Rodríguez, the greatest ever Mexican race driver, had huge success driving for Porsche at many European races, including the 24 hours of Le Mans. As a result, the Porsche brand has been closely associated with sports vehicles in the minds of car aficionados. To this day, many customers come to us with stories about their ancestors either witnessing or participating in these legendary racing events.
Q: How quickly has Porsche grown in Mexico and how are you capturing the attention of new customers?
A: Between January and November 2014, we grew by 24.3%, which was four times more than the overall automotive market in Mexico. Customers who acquire a Porsche are looking for a car that gives them a different feeling, and a car that can stir emotions. This is not a machine for getting from A to B, but a car that represents a way of life and a whole new experience. Whether they buy a 911, Cayman, Boxster, Panamera, Macan, or Cayenne, they know that Porsche will surpass their expectations. Even so, this does not mean that Porsche is totally immune to the market trends and economic developments that affect other OEMs. We regularly update our product portfolio in order to bring something fresh to the market. In 2014, for example, we had eight product introductions in the Mexican market, including completely new models like the Macan, new generations of the Cayenne, and fresh interpretations like the 911 Targa.
Q: What impact are these new vehicles having on the Mexican market?
A: With the introduction of the Porsche 911 Targa, we are offering our customers a new version of the iconic 911, with an even more stylish and versatile design. The 911 Targa can attract new customers who are looking for a car unlike anything else in the market, something really unique and exclusive. This car is both a coupe and a convertible, with the ability to be used on the racetrack, in the city, or on the highway, without compromising performance. The new Porsche Macan has also helped to attract new customers, particularly those who may not have considered driving a Porsche in the past. It is a very practical car with a beautiful design and is lighter, sportier, extremely agile, and slightly smaller than the Cayenne. It certainly represents a new SUV concept that is unlike anything else in the market. The Macan also attracts a younger customer base, appealing to recently married couples or young professionals who want to treat themselves.
Mexico is also reacting well to some of our limited edition models, for instance, the Porsche 918 e-Hybrid Spyder, of which only 918 units were built, has sold 9 units in Mexico. This accounted for more than half of the Latin American quota. Additionally, only 80 Porsche 911 Martini Racing Editions were built worldwide, seven of which are in Mexico. Many Mexican customers are true car connoisseurs with a taste for limited edition vehicles.
Q: What financial services does Porsche offer to its Mexican customers?
A: Porsche Financial Services is our financial instrument. It is totally supported by Volkswagen Financial Services and we enjoy all the assistance and knowledge that Volkswagen Group can offer. However, the financial products we offer are tailor-made for the cars we are selling and the customers we cater to. Around 29% of our car sales are achieved though financing, utilizing all the relevant financial products, such as traditional credit, premium credit, and leasing. These are available for all of our cars, making Porsche Financial Services a very good option for customers who never thought they could own a Porsche. Our leasing option has been particularly important in supporting our growth as it has increased by almost 200% in 2014 alone. Previously, leasing was not seriously considered in Mexico, but changes to tax obligations and regulations resulted in a substantial financial impact on our clients.
Q: Opening a dealership is a deeply strategic choice, given how few you have. What are the steps that Porsche takes before opening a new dealership?
A: First of all, we need proof that a specific location is mature enough to support a Porsche operation. We hire independent advisors to analyze the market and find locations where demand is big enough to support a dealership. After that, a committee decides on the locations that we should explore further. Potential partners need to be locally-rooted investors and successful business people, they need to have a measure of prestige, and they should be trusted in the community. Our committee analyzes the partner profiles and whittles the list down to five or six, which we then invite to bid for the dealership. Once we receive their confirmation of interest, we send them a package detailing our estimated volumes and prices, our brand policies, and all the topics they have to follow. After a couple of months, they have to submit a full business plan to Porsche and, when we determine which candidates have the most compelling business cases, we pay a visit to their current premises. We evaluate their management style, their personnel turnover, their finances, and their customer satisfaction, in order to provide a complete analysis. Each member of our team then independently scores each candidate before we vote. Once the decision is made, we then make our final recommendation to the Volkswagen Group, which is usually accepted. Unlike other 111 brands, managing a Porsche dealership is not about large sales volumes, but about generating satisfaction with our vehicles and our service.
Our customers should be treated with dedication and respect, and they ought to be able to get in touch with the owner of the dealership when they need to. Consider the new experience we are offering this year with our Porsche Center Santa Fe, which is smaller than most of our dealers and acts as a boutique. This establishment allows the customers to relax, enjoy the exclusive atmosphere, and receive special attention from Porsche.
The expansion of our dealer network is closely linked to the performance of the Mexican economy. Some markets that were not on our radar five years ago are now very appealing. We will soon open a new dealership in Veracruz and we are looking at various promising locations in other parts of the country.
In 2014, we opened new dealerships in Leon, Guanajuato and Santa Fe, to reach a total number of 11 dealers nationwide, and we also overhauled our dealership in Interlomas, Mexico City. In 2015, our growth in Mexico should exceed 24%, which is even higher than the dynamic growth of our brand on a worldwide scale. Therefore, we are delivering sound results despite the challenging environment.