"Tariff Adjustments" are coming, says my SA

[henrus]

Trump apparently threatened auto ceos not to raise prices. Don’t know how they do that.

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[sor]

There is a scenario where this ends by auto makers committing to some monetary value investment to bring manufacturing to the US, in exchange for some time to do so. Not passing judgement on whether that’s good or bad, shifting manufacturing always has winners and losers.

I also think many brands are in the position to distribute the pain, BMW for example makes many of their SUVs in the US already. They can raise prices on everything a little rather than just jack up imports to the ceiling. They could distribute the pain globally as well, raising prices a bit across the world to account.

 

[kaiju]

According to Grok, the AI engine, tariffs typically are applied when goods arrive at port. So ostensibly the vehicles in the US now, and any that arrive before the tariff date, would not have it applied. YMMV.

Dealers and automakers we do things in anticipation

 

[Mike117]

My wife and I were going to order a vehicle on 3/22 that we built in the builder tool. However, it typically takes 12 weeks to build and ship, well after Tarrifs on cars and parts go into effect. Our SA told us the cost would probably be 15-20% more. So we ended buying one we liked that day.

 

[Frenchboy]

Turbo on order here. On Crystal Ray.

I too am quite confused with the current situation and lack of messaging from PNA to the dealers.

One point that PNA must be mulling over is the following:
Macan is Porsche's volume seller. NA is their biggest market. EV is the new powertrain for a car that needs to sell. They are just starting with meaningful sales for the model and need broad adoption. Pushing the high tariffs straight to consumers on a car that is already pricey compared to the outgoing model, would seriously affect adoption.

 

[someTimesJoe]

Dropped off my Taycan today for service and was provided a Macan 4S loaner. Talked to my SA and he said my Macan is ok. It’ll be in Benicia port tonight but was saying that any vehicles that haven’t left port yet in Germany, are like subject to the price hikes.

 

[pdealessandrini1930]

does this impact already existing leases and their buyout prices when the lease is up ? or is that locked in and not changeable?

Lease buyouts are locked in as the consumer and the lease co capitalized the price of the new vehicle at time of delivery hence buyout is pre agreed % of original purchase price.

 

[pdealessandrini1930]

Dropped off my Taycan today for service and was provided a Macan 4S loaner. Talked to my SA and he said my Macan is ok. It’ll be in Benicia port tonight but was saying that any vehicles that haven’t left port yet in Germany, are like subject to the price hikes.

Hi to all.

many interesting comments posted. Varying degrees of directionally correct views.

from speaking to dealer principals and covering the sector - while details are to follow from PCNA to US Dealer Network - here are some building blocks:
1. Porsche AG (HQs) invoices PCNA (US Sub).
2. Like all multinationals Porsche AG manages to optimize taxable income. If German corp tax rate is higher than US tax rate, German parent will manage the transfer pricing to reduce taxable income in Germany and increase income of the group be lowering the invoice price the HQs charges PCNA for each model based on actual invoiced build.
3. Import Tarrifs apply to $ invoice value of imported vehicle. If Invoice to PCNA is lowered to improve taxable income in US at lower rate applied to PCNA, then the Duty charged ia on the lowered Import Invoice.
4. Import duties aren’t on the window sticker Gros’s suggested retail price it’s in the import invoice.
5. Like some cars get gas guzzler tax as a separate line item, we should expect to see: a. Total price of car $x (already in window sticker), b. Dealer deliver charge $y (already in window sticker) And now c) $z for Tarrif.
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Assuming Porsche won’t want to be called out for cheating US loyal owners and alienate prospective buyers fleeing to BMW, Mercedes, they won’t leave it random nor allow dealers to play games.
Porsche US Corp (PCNA) in consultation with Porsche AG HQs will surely have a streamlined process for all dealerships.

in the end, car prices will go up by the tariff but more likely in the internal import invoice not the nominal window sticker which benefits from parent transfer pricing dynamics. And yes, our used car values should benefit. And no the buyout of an existing lease won’t be affected as that vehicle was sold to Porsche Financials services at time of lease and the buyout price is locked in.

I wish this wasn’t happening as all of us who like to trade in for newer models will be considering joy of new car smell vs our bank accounts. Ouch!

 

[Wivenhoe]

Very informative. I’m hoping sales do continue in the US because if they drop significantly then Porsche may be tempted to switch more production to the UK market at a discounted price so adding more pressure on Residuals.

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