2017: Another record year for Porsche Holding Salzburg
- Steady growth in the passenger car markets
- Encouraging trend in all regions in which PHS has operations
- New and used car sales expected to top 1 million units
- Record turnover in wholesale
- New digitalization and e-mobility initiatives
Porsche Holding Salzburg (PHS) recorded an extraordinarily successful year in 2017.
Dr Hans Peter Schützinger, the new CEO of the PHS Management Board, presented the preliminary figures for the 2017 financial year at today's annual press conference in Vienna.
Current forecasts indicate that this year the company will increase its sales volumes in all regions in which it has automotive wholesale and retail operations (with the exception of France*)).
In spite of the disposal of the PGA Group mid-year*), PHS expects to sell 770,300 new vehicles (+2.6%) and 254,700 used cars (-9%) in 2017, sustaining the previous year's record level with an aggregate of over 1,025,000 forecast units.
PHS's loss of some 70,000 new vehicles in the second half of the year following its sale of PGA was nearly compensated for by the stronger performance in the markets but also by additional volumes from new markets (Sweden, Malaysia). The PGA sale reduced the number of dealerships and the headcount, however.
*) PGA Motors SAS, a retail subsidiary of PHS which deals in non-Volkswagen Group brands, was sold together with 261 dealerships in France, Belgium, the Netherlands and Poland. It employs 9,300 people.
Porsche Holding Salzburg has automotive wholesale and retail operations in 27 countries. Besides Europe, the company has a presence in South America, China and Malaysia and, since April 2017, has also been represented in Singapore and Brunei.
Around the world, PHS operates 426 dealerships (-202) and has 29,500 employees
Passenger car sales rising in all markets in which PHS has operations
In all countries in which PHS has operations, an encouraging trend can be observed in the market as a whole.
The Austrian market, for example, will present the second-highest value ever with an estimated approx. 350,000 new passenger car registrations (+6.2%). The only year the market was even higher was in 2011, when 356,145 new vehicles were registered.
The upswing is also continuing in the entire CEE region including Ukraine. Here, the markets as a whole have expanded by 12% overall, but are still not even close to reaching the level recorded in the pre-crisis years.
In Germany, Spain, Italy, France, Sweden and Poland, countries in which PHS has retail operations, the markets have also grown, in some cases considerably.
Record volumes in wholesale
PHS has wholesale operations in 20 countries for the Volkswagen Group brands. In all markets, PHS has managed to at least keep pace with the market. "In wholesale we expect to deliver around 371,000 new vehicles, 13.2% more than a year ago, which means we will achieve a new wholesale record", said H.P. Schützinger, the new CEO of the PHS Management Board, commenting on anticipated turnover with satisfaction. "I am particularly pleased that we have succeeded in capitalising on the positive market trend for our further growth - and this in all markets in which we have responsibility for imports", he added.
Further impetus in retail as well
This year, PHS's retail operations are benefiting from a plethora of new models but also from the sustained positive market sentiment as well as from new acquisitions in Sweden and Italy.
In the retail operations of the Volkswagen Group brands, PHS expects deliveries to customers to rise by 26% to around 329,000 new vehicles.
The used car business (excluding PGA) is also developing positively, with a 35% increase to 186,000 vehicles expected.
This does not include PGA's vehicle sales from last year and this year.
PHS has retail operations in 23 markets and operates a total of 426 dealerships.
Remarkable automotive year in Austria
Official market figures as at the end of November 2017
In Austria, 327,669 new passenger cars had been registered by the end of November, 7.8% more than in the same period of the previous year.
The Volkswagen Group brands have lifted their deliveries to 111,324 new vehicles (+6.2%), thus achieving a market share of 34%. This has enabled them to keep pace with the market growth and sustain the high level of the previous year.
Four Volkswagen Group brands in the top ten
The Volkswagen brand is the uncontested No. 1 and since 1957 has consistently been Austria's top-seller by a large margin. By the end of November, Volkswagen had succeeded in boosting sales by 4.7% to 54,465 new registrations, achieving a market share of 16.6%. ŠKODA came second on the strength of its impressive market performance and the best year in the company's history. Its 23,443 new vehicle registrations (+18.9%) give the company a 7.2% market share. The SEAT brand is also advancing significantly this year, lifting new vehicle registrations by 13.5% to 16,271 units, which puts it in eighth place in the brand rating. Audi has had to contend with situations such as delivery restrictions and bottlenecks in Austria this year caused by the growing SUV trend and stiffer competition. Nevertheless, the Audi A4 remains the most popular car in the traditional business segment. With a market share of 4.9% and 15,944 new vehicle registrations, Audi comes tenth in the brand rating.
Top five places for Volkswagen Group models
For 39 years, the VW Golf, which has consistently been the most popular car among Austrians, has effortlessly come out on top with a market share of 4.9%. Below it, ranked two to five, come the Škoda Octavia (2.7%), the VW Tiguan (2.6%), the VW Polo (2.3%) and the Škoda Fabia (2.1%). The VW Multivan (Passenger Cars), which takes seventh place with a market share of 1.9%, and the Seat Ibiza, which ranks ninth with a market share of 1.6%, round off the successful presence of Group models in the Top 10.
A record year also for Porsche and Exclusive Cars
As things stood at the end of November, this is the year with the highest sales ever for the sports car brand Porsche in Austria. In spite of strained delivery conditions at times, Porsche expects 1,280 new vehicles to be registered in Austria by the end of the year, thus setting a new record.
In Austria, Exclusive Cars with the brands Bentley and Lamborghini will finish the best year in their history, significantly increasing deliveries to customers.
In 2017, motorcycle brand Ducati has succeeded in keeping its sales volume on a level with the record-breaking previous year. In terms of new vehicle registrations, as at the end of November, Ducati had fallen slightly short of the prior-year figure with 697 units (-4.5%).
Status of the diesel issue in Austria
The recall of Volkswagen Group models fitted with EA189 diesel engines is going very well in Austria. By now, around 320,000 models have been retrofitted; that means 86% of customers have been reached. The Group will forge ahead with its servicing campaign at full capacity.
Performance of the diesel market share in Austria
In 2017, just under 50% of customers in Austria opted for a new vehicle with a diesel engine; this is 7.4% fewer than in the previous year.
At 62%, the Volkswagen brand's diesel market share is significantly higher than the average for Austria, though a decrease in line with the overall market can be observed here, too.
PHS believes this is attributable to the growing uncertainty among customers generated by the open discussion of penalties for diesel vehicles, which is leading to calls for restrictions or driving bans in cities.
What is notable here is that the biggest decrease at Volkswagen is in the small and compact car category, whereas in the upper midsize class and premium class, where most vehicles are purchased for fleet use and rack up considerable mileage, a decrease is hardly perceptible owing to a lack of cost-effective alternatives.
State-of-the-art Euro 6 diesel engines are among the most environmentally friendly drive systems. Here, Volkswagen Group models in particular have fared exceedingly well in several independent exhaust tests conducted in recent months and have been ranked far ahead of other vehicles.
Uptrend in electric vehicles continuing
By the end of November, a total of 4,955 all-electric vehicles had been registered in Austria, an increase of almost 38% over the previous year. However, the market significance of electric vehicles, which have a market share of just 1.5%, is still low.
In 2017, Volkswagen launched a sales drive with the e-Golf and offered this at a particularly attractive price together with the government incentive.
This will increase sales of the e-Golf by a factor of three this year to 1,350 units, but owing to delivery problems only 588 units of the e-Golf have been handed over to customers so far.
Reward scheme for scrapping of old vehicles taking effect
As part of the environmental programme, the Volkswagen Group brands in Austria kicked off a reward scheme for the scrapping of old vehicles in August that provides higher subsidies for alternative drive systems.
Under this scheme, the brands offer a scrapping bonus to customers who are looking to buy a new model and, at the same time, scrap an old diesel car of any brand that complies with emissions standard Euro 4 or older. For the VW e-Golf, for example, the total bonus (including the government incentive) constitutes a subsidy of 11,680 euros.
Overall, around 7,000 new vehicle sales across all Group brands have so far been registered that involved the trade-in and scrapping of an older diesel vehicle. In the case of Volkswagen brand cars, for instance, one in four new vehicle customers have taken up the reward scheme. This promotion only runs until the end of the year.
Volkswagen Group's e-campaign
On the periphery of the IAA in Frankfurt, Volkswagen AG announced that it was kicking off the most extensive electrification drive in automotive industry with its "Roadmap E" starting in 2020 and use of the Modular Electrification Toolkit (MEB).
The Group's objective is to become the world's leading provider of electro-mobility by 2025. To this end, 80 new electrified models will come onto the market worldwide by this date, 50 of which will be all-electric vehicles. Up to then, 20 billion euros will be invested in the industrialisation of electro-mobility.
And from 2030, there will be at least one electric car in each model series of all of the Group brands.
New markets, new tasks
After entering the Malaysian market in 2016 followed by Singapore and Brunei in April 2017, PHS took over sales for the Volkswagen Passenger Cars, Volkswagen Commercial Vehicles and Das WeltAuto brands, expanding their presence in the ASEAN region.
Singapore is one of the world's most expensive automotive markets; here, a total of around 90,000 new cars are sold each year.
In retail, as mentioned before, VGRF (Volkswagen Group Retail France), which comprises 63 dealerships selling Volkswagen Group brands, was founded in France. This group employs 1,600 people. In return, the PGA Group with non-Group brands was sold.
Effective 1 April, PHS took over the Swedish-based Din Bil group with its 37 dealerships and 1,900 employees which also represents Volkswagen Group brands.
In Italy, six dealerships were added in the Florence region, bringing the number of dealerships that PIA Italia currently operates to 11; these employ 340 people.
Digital transformation and disruption
Digitalization drive at Porsche Austria
At Porsche Austria, the focus is on the core business of buying and selling cars as well as servicing of Volkswagen Group brand vehicles. Through digital innovations and transformation, new offerings are being created to meet changed customer demand.
Digitalization is reality. Connectivity is the new customer proximity.
For this reason, Porsche Austria launched a digitalization drive several years ago, bringing large numbers of new digital products onto the market.
Today, virtually all customer enquiries start digitally and all end with delivery of the vehicle to the dealership.
Porsche Austria attaches considerable importance to the integration of dealerships so as not to create disruption between the digital online world and the analogue offline world. To this end, the dealerships' sales, servicing and finance systems have been restructured.
In the new vehicle segment, mobile brand websites have been developed on the basis of customer ratings and appraisals: mobile vehicle configurators with equipment recommendations as well as a platform for online booking of test drives, online reservation of vehicles and online financing checks.
The extensive range of used cars on offer can be found on the "DasWeltAuto" mobile site with a 360° view of the cars, a calculator of the car's value, matching equipment and virtual test drives.
Mobile Service Reception and Book a Service for tyre change and servicing are available to servicing customers.
With Mobile Service Reception customers receive a transparent offer of due repair and servicing requirements in an objective, interconnected process and can then easily order these services via their smartphone. This gives customers an overview of the current status of their vehicle and the expected costs at all times.
Finally, a new portal for rating services provided by the dealership called the Car Advisor has been rolled out, in which customers can submit their appraisal using a five-star rating system, quickly and unbureaucratically.
In 2017, the dealers and service centres received 50,000 appraisals, which provide a representative picture.
The customer rating was very positive with an overall score of 4.8 and a 98% recommendation rate. Critical customer feedback gives the dealership the opportunity to react and modify work processes as required.
Allmobil GmbH: PHS's cross-brand and cross-sector company
In setting up Allmobil GmbH, PHS founded a new company for cross-brand and cross-sectoral future issues that deals with new business areas related to auto-mobility and gets closer to these in a disruptive manner.
The first product is "Mobidrome", a cross-brand platform for people who know little or nothing about cars but are keen to have the right one.
Mobidrome gives its users ultimate transparency in finding a car. Five-star ratings and reviews help other visitors to the platform to find their car in a simple, uncomplicated process. A platform by users for users.
Just shortly after the market launch, more than 400 dealers of all brands put the details of over 28,000 used cars online.
In addition, visitors can consult the value of their used car on Mobidrome.
Market outlook for 2018
For 2018, PHS forecasts a continuation of the stable market conditions in Austria and an ongoing recovery of the markets in the CEE region. In 2017, the positive consumer climate in Austria was again dominated by the favourable overall economic situation, a relatively low unemployment rate, low interest rates and low fuel prices.
PHS does not anticipate any major changes in these factors of influence in the coming year and therefore estimates that the passenger car market will remain at a high level in 2018.
In 2018, the Volkswagen Group brands will once again stimulate the market with a large number of new models:
- Volkswagen with the T-Roc and the new Polo GTI or Golf Sportsvan
- Volkswagen Commercial Vehicles with the Crafter Kombi
- Audi with a veritable fireworks display of products - the A8, A7, A6 and the first all-electric model, the e-tron
- SEAT with the Arona models and another SUV model
- Škoda with the new Karoq and the Kodiaq Scout
- Porsche with the Cayenne and the Panamera ST
- Bentley with the new Continental GT
- Lamborghini with the Urus
to mention just a few of the upcoming highlights.
In addition, the Golf is celebrating 40 years of market leadership in Austria and the "Rabbit" its 40th anniversary.
PHS therefore expects that market performance in the coming year will be maintained at the 2017 level.