MOTOR SHOW: Porsche Eyes Further Growth Next Year Despite Headwinds

By Christoph Rauwald

PARIS--Volkswagen AG's (VOW.XE) sportscar brand Porsche said it remains on track for a record year in 2012 despite growing economic headwinds and targets further growth next year.

"It is our goal to follow up on the 2012 results next year and continue our success, depending on the market situation," Porsche sales chief Bernhard Maier said in an interview during the Paris auto show.

He acknowledged that Porsche "reacted to the current market development and adjusted its plans for 2013 accordingly".

The Stuttgart-based firm is presenting all-wheel drive versions of the new-generation 911 model at the Paris show and a high-performance diesel version of the Cayenne sports-utility-vehicle.

Mr. Maier dismissed concerns that Porsche is experiencing weaker sales. Luxury-car sales had been largely unaffected from the woes embroiling the mass-market segment in Europe amid a softening economy, but it became evident last week that anemic demand for cars has started to spill over into the less price-sensitive premium segment. German rival Daimler AG (DAI.XE) was even forced to cut its full-year earnings target for the Mercedes-Benz Cars division.

"Despite growing economic clouds we're on track for a record year 2012," Mr. Maier said.

Analysts, however, have become increasingly cautious about the prospects in the lucrative luxury-car sector.

"Our main concern remains Europe, where each month reveals new evidence of more aggressive pricing promotions," Morgan Stanley analyst Stuart Pearson said Tuesday in a note. "However, Europe, the U.S., China and other global markets are inextricably linked," Mr. Pearson said. Premium cars are largely homogeneous products across the globe, so weaker demand in one region can drive higher supply to another.

Porsche's global deliveries rose 21% on the year to 10,912 cars in August and were up 15% at 92,474 vehicles in the January-to-August period, keeping the brand well on track to reach a new annual sales record this year. Porsche sales rose in all major markets across the globe last month, fueled by the new-generation of the 911, the revamped Boxster roadster and the Cayennne SUV.

Porsche, which was fully integrated into Volkswagen's stable of brands in August, is one of the world's most profitable car makers with operating return on sales of more than 15%. It is set to reap large additional cost savings in coming years as part of Volkswagen, Europe's largest auto maker by sales. Some sportscar aficionados have voiced concerns, however, that the integration could hurt Porsche's exclusive brand image.

Porsche is preparing the launch of a new compact SUV named Macan in 2013 and will also add the high-performance 918 Spyder sportscar to its line-up.

The Macan will be Porsche's fifth model line, in addition to the larger Cayenne SUV, the 911, the four-door coupe Panamera and the Boxster/Cayman sports cars. It is expected to be a cornerstone of the Stuttgart-based sports-car maker's goal to boost annual sales volume to 200,000 by 2018. Porsche sold 118,867 vehicles worldwide last year, up 22% from 2010.

-Write to Christoph Rauwald at [e-mail]

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