Porsche: VW’s most profitable brand

Porsche is the VW Group’s most profitable brand with €15,000 operating profit per vehicle sold.

Some parts of the media have been suggesting, following his ‘resignation’, that former Volkswagen chairman Ferdinand Piech had been lobbying family members behind the scenes in a bid to install Matthias Mueller, chief executive of Porsche, at the helm of VW, thus reneging on a deal Piech made to support Martin Winterkorn.

Whatever the validity of the rumours, figures compiled by this blog from data supplied today by Volkswagen Group, could point to at least one reason why the rumours may have some substance.

Volkswagen Passenger Cars earned only €347 on ever car sold in the first quarter of 2015.

This is using financial data produced today by VW Group and unit vehicle sales figures released by Volkswagen on 22 April last.

By contrast, Porsche had an operating profit per vehicle of €15,000 – 43 times larger than that of VW Passenger Cars.

Bentley says it does not release 2015's first quarterly unt car sales. So, making an assumption based on last year's operating profit of €45 million and one-quarter of 11,020 cars sold in full-year 2014, the figure for operating costs per vehicle could be more than €16,333, namely better than Porsche's performance.

However, Audi was the most profitable of the Group’s ‘volume’ producers, with an operating profit per car of €3,194.

As to the commercial vehicle side of the business, prestige Swedish heavy truck maker Scania ranked second to Porsche and headed the ‘volume’ car section with an operating profit of €13,542 per vehicle sold.

In this context, it is easy to understand why Carl-Henric Svanberg, the chairman of Volvo, should head-hunt Martin Lundstedt from Scania as his man to replace Olof Persson who, as chief executive officer of Volvo, seemingly failed to deliver the profit margins required. Lundstedt’s task is to turn Volvo around.

German heavy truck maker MAN could return only an operating profit of €1,538 per vehicle sold while Volkswagen Commercial Vehicles – selling five times more vehicles – was not far behind with an operating profit of €1,524 per vehicle sold, but still over four times that of the VW Passenger Cars.

As to Skoda, once the joke car of Europe, its managers managed to achieve a commendable operating profit of €912 per car sold – two and a half times better than Volkswagen Passenger Cars.

Last but not least, SEAT, which VW rescued from Spain, turned in the lowest performance with €321 operating profit per car.

Now it is quite feasible that the figures produced here do not represent the whole picture; much depends on the definition of the words operating profit.

But, taken at face value, the figures do show just how far Volkswagen Passenger Cars has to travel to even match the performance of Skoda. On the face of it, the brand is wasting money; or, put another way, it is not using its resources efficiently.

No wonder Ferdinand Piech’s concern by the direction in which one part of the Group was travelling.