Case1-Porschefinalpresentation
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Transcript of Case1-Porschefinalpresentation
PorschePorsche Changes TackCase StudyMay 8th, 2013
Risk Management and Derivatives 723G33
Index
1.History / Family background2. Statistics3.Strategies4.Marketing5.Creation of competitive
advantages6.Risks7.Shareholder Wealth vs.
Stakeholder Capitalism Risk Management and Derivatives 723G33
History and Family Background
Ferdinand Porsche,Founder of the Porsche Company (1931)
Louise Piech Ferry Porsche
History and Family Background
Wolfgang Porsche,Former boardmember of Porsches directorate
Ferdinand Piech,Chairman of VW´s supervisory board Risk Management and Derivatives 723G33
Wendelin Wiedeking, former CEO of Porsche GmbH
Statistics
Risk Management and Derivatives 723G33
Statistics
Risk Management and Derivatives 723G33
Strategy 2018“We‘ve always been ambitious.And we‘ll make sure it stays that way.“
Risk Management and Derivatives 723G33
Marketing (Portfolio)911- Presenting the brand- Growing old; replacement needed- Sales peak in 2001/02; 15%
decrease after- Prices high; highest margin- Not price elastic
Boxster- Introduced in 1996- Entering low price market- Less sensitive for business cycle- Sales peaked in 2000/01- had to compete with BMW
Exclusive Sports Car Manufacturer
Risk Management and Derivatives 723G33
Marketing (Portfolio)Cayenne- Entering sports utility vehicle
(SUV)- Very quick success- Criticism; Comparable to VW
Touareg
Panamera- Premium class, four door,
four-seats coup sportscar- Price between $125.000 –
$175.000- Premium product market
segment
Exclusive Sports Car Manufacturer
Risk Management and Derivatives 723G33
Marketing (Positioning)Exclusive Sports Car Manufacturer
High Price and High Quality
Risk Management and Derivatives 723G33
Marketing (Marketing Mix)
Product : high qualityhigh performanceexclusive
Price: high priceelite status
Promotion: comsumer focused advertising (TV, direct mail)
Place: Europe (911)North America (Cayenne)
Exclusive Sports Car Manufacturer
Risk Management and Derivatives 723G33
Marketing (Segmentation)Exclusive Sports Car Manufacturer
Top Guns: driven, ambitious
Elitists: blue blood, not price sensitive
Proud Patrons: ownership is goal, trophy for hard work
Bon Vivants: Jet-setters, thrill seekers, adventures
Fantasists: car is escape,
Everyday users: enjoy, younger driversRisk Management and Derivatives 723G33
Creation of competitive advantage
Risk Management and Derivatives 723G33
RisksCurrency: - Production base in Euro-area, therefore risk only at sales
- demand focuses on global markets FOREX trading (exchange rates variations)
against risk they apply hedging (derivatives, forwards, futures)
Political uncertainty: affects any MNE, political decisions can destroy corporate strategy. EU is relatively free of political uncertainty.
However: - Lex VW (law of VW), that no shareholder may have more than 20% of voting rights, despite the number of shares
- 2009, country of Lower Saxony publicly opposed the takeover of Porsche
- Friendly joint venture was soon considered as hostile takeover by Porsche management
Lack of social relations or good PR Risk Management and Derivatives 723G33
Risks
Outsourcing: decay of quality of manufactured products and control in general
lack of knowledge and industry country becomes less desirable for
investors
Porsche fights against this risk by investing in human capital (their biggest asset)
Credit: Porsche increases external liabilities for takeover of VW & inhouse construction of Panamera
this high liabilities in connection with the financial crisis brought down the company in the end
Risk Management and Derivatives 723G33
Shareholder wealth vs. stakeholder capitalism
How to get capital?
In general: Anglo-Saxon-Model vs. Continental-German-Bank- Model
Porsche: - preference shares and ordinary shares different voting rightsstakeholder orientated (stakeholders =
family)- dividend was not issued to shareholders cashflow of high profitable car sector was
used to takeover VW
Risk Management and Derivatives 723G33
Shareholder wealth vs. stakeholder Capitalism
Porsche refuses to make quarterly reports (rational strategy – less information for potential competitors)Not listed at a german stock exchangeThey gain capital from outside at London
Stock Exchange
Risk of scaring shareholders, because management ignores shareholder‘s will Scare off capital of investors
Risk Management and Derivatives 723G33
sources
http://www.porsche.com/middle-east/_ghana_/aboutporsche/overview/strategy2018/
http://www.iei.liu.se/fek/frist/723G33/yinghong-files/1.460514/Porsche_Changes_Tack.pdf
http://www.porsche.com/
https://www.youtube.com/watch?feature=player_embedded&v=WWRA1ABlFnw#!
Risk Management and Derivatives 723G33
Thank you for your attention!!
We hope you all have read the case and do not have any questions!