Porsche borrows 10 billion euros to buy stake in VW

At the recent Porsche general staff meeting, Porsche CEO Wiedeking expressed his views on the latest media frenzy around the Porsche - Volkswagen relationship. Implying that Porsche will not be taking over Volkswagen, he said Porsche will operate independently of Volkswagen’s decisions. But that doesn’t seem like the case here.

According to a banker involved in the Porsche/Volkswagen transaction, Porsche has borrowed $13.7 billion from 37 lenders to finance the purchase of its remaining Volkswagen shares.

Porsche officially submitted an...
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rom64 - 7/12/2007 3:21:23 PM

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There goes the neighbourhood!

('The Empire Strikes Back' Theme song in the background)

nybimmer - 7/12/2007 3:36:04 PM

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Yikes...they'll have to sell about 1 million 911's (assuming they make a $10,000 profit on each one, which might not be a correct assumption) to pay back 13.7 billion Euros.

nybimmer - 7/12/2007 3:37:59 PM

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Sorry..math error...they will have to sell about 1.4 million 911's to pay back the loan. Yikes again!

Do they make a profit selling Cayennes?

Designer1 - 7/12/2007 5:18:54 PM

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You know I always wanted to know how much profit the car manufacturers make in each car. Does anyone have a real idea? Not just a thought.

Rupert - 7/12/2007 6:34:01 PM

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They make a huge profit selling Cayennes, they're what has kept Porsche up for the last 3 years.

Agent63 - 7/12/2007 9:54:02 PM

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I heard from Honda the Civic is really worth 6-7K but they sell for much more. but im not too familiar with that sort of thing.

ThierryHenry14 - 7/12/2007 3:45:08 PM

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Porsche is the most profitable automotive company. Of course they will make it back. And with VW/Audi on the rise in 07, its a good investment.

Agent009 - 7/12/2007 4:12:12 PM

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They adapted the Toyota "Lean and mean" principles in the 90's.

That is why they are so profitable.

moto - 7/12/2007 6:01:02 PM

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Almost every Porsche sold in the USA has over 20% profit margin, the highest in the automotive industry by far.

Porsche not only sells some of the world's best cars, they are also financially astute. I can't see any downside to Porsche increasing its influence in the industry.

nybimmer - 7/12/2007 6:07:27 PM

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Still...they will have to sell a heck of a lot of extra, profitable, cars to pay back that money.

Anybody know how many Volkswagens are profitable? On a back of the envelope basis, I don't see how this is additive for them as a whole. Heck Porsche was offering 5-digit (i.e. $10,000+) incentives to unload the leftover old gen Cayenne's.

I'd love to know what their warranty costs are.

richardp996 - 7/13/2007 2:56:05 AM

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Do not forget Porsche produces substantial amount of revenue from Weissach consulting and design activities.

richardp996 - 7/13/2007 3:04:53 AM

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Porsche only has one factory team, Penske Porsche but other than that the company makes money selling racecars: GT3 Cup ($140,000), GT3 RSR ($280,00+), RS Spyder (for who knows what amount). Considering that Porsche Design gets revenue from designing products for other copanies.