By on December 12, 2010

Having been cut off the lucrative (and in the end deadly) derivatives business, Porsche looks for other sidelines. And it seems very much like they have found one: Consulting.

“Just as car enthusiasts envy Porsche drivers,” reports Automotive News [sub] “company executives salivate over the carmaker’s profit margins, the highest in the industry.” Said salivation generates juicy business at Porsche.

That prompted Porsche into teaching other companies how to generate hefty profits. Let’s hope they don’t tell their clients the truth: Just charge a lot of expensive extras.

Porsche already signed up clients such as Lufthansa, Volkswagen and shipbuilder Meyer Werft. Instead of learning how to sell inflated sat-nav systems, Porsche’s consulting clients aim to gain know-how in efficient production methods to boost profitability.

Porsche’s consulting division will expand its 220-strong workforce to serve an increased customer base of 150 companies.

Porsche is proud of an operating margin of 19 percent in their automotive unit. BMW must make do with 8.1 percent, while Mercedes-Benz has 9.5 percent and Audi a respectable 11 percent.

Actually, Porsche is recycling foreign know-how. When Porsche was doing atrociously in 1993, and Wiedeking took over, he hired Toyota’s consulting arm. Says Automotive News: “Under Toyota’s guidance, Porsche took steps to fine-tune cooperation with suppliers to ensure factories received parts just when they were needed on the assembly line, a method that’s been widely copied in the automotive industry and that Porsche is now helping companies in other industries implement.”

Gee. Valuable intellectual property. Taken from the Japanese by Germans, and sold at a gefty profit. What is the world coming to?

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6 Comments on “Want More Profits? Hire a Porsche (Consultant)...”

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    Unless they’re telling their clients to simply target buyers with first access to credit during booms, and first access to bailouts during busts, they are either not getting it, or are deliberately lying.
    P makes nice cars, but in civilized societies; that is, ones spared deliberate policy to asset strip the productive classes for the benefit of one small, well connected gang of leeches for whom price tags are academic; and another, much more numerous gang regulated out of work and income, and left to be paid in bread crumbs to cheer the former on; purchasing power distributions would be a lot less supportive of P’s pricing strategy.
    But then again, as long as the bread crumbers can be reliably kept believing the only way they can feed themselves at all, is due to all those nice, altruistic  Soros types in NY and other financial centers protecting them from the scary, bad productive people, hey……. And P does make nice cars.

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    Let’s see…    I take 220 of my best & brightest to help other companies compete against me.  Hummm…

    But the consulting business unit will show amazing growth!   

    Perhaps a better model is an acquisition team for turn-around situations.

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    It’ll probably prove to be very lucrative, although there isn’t exactly a consultant shortage.  At any rate, I worked at a fairly large consulting firm for a bit.  This about sums up the experience:

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    Porsche could offer a master class on milking heritage. The Sport Classic was, what? A Carrera with a body kit? And they’ve sold the entire run at over double the price. Well bloody done!

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    Well, anytime a Japanese automaker builds a car with a Wankel (rotary), Diesel, or Otto Cycle (4-stroke) motor, they are copying a German product. Seems like a fair trade.

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