Date
16 December 2017
China has about 80 Porsche dealers. Intensifying competition often forces them to sacrifice already thin margins. Photo: Internet
China has about 80 Porsche dealers. Intensifying competition often forces them to sacrifice already thin margins. Photo: Internet

Why mainland Porsche dealers are unhappy

Ultra luxury marques can easily cost several million yuan, but if you think selling these big-ticket autos is a great business, recent complaints from Porsche dealers in China will change your mind.

The sector is facing strong headwind. Beijing’s anti-graft campaign is hurting demand while dealers have to fight harder for business following excessive expansion of retail outlets.

In 2011, Porsche’s mainland sales surged 65 percent but in the first half of 2014, growth slowed to 8 percent, Yicai reported.

At the same time, Porsche dealers increased from 48 in 2012 to about 80 at present.

Often, dealers have to throw in free accessories or upgrade to win customers, thinning already tight margins of 4-8 percent.

According to reports, dealers may stop taking in new cars from Porsche in January due to disagreements over fees, subsidies, sales targets and promotion policies.

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RA

EJ Insight writer

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