Most Indications Point To Success In Market Following Debut At Shanghai Auto Show, But Will Consumers Shell Out?#
Earlier this year, the Porsche Panamera Turbo -- Porsche's first-ever four door sports sedan -- made its global debut at the Shanghai Auto Show, arguably the most important auto event of the year. At that time, everyone from Porsche execs to attendees was enthusiastic about this sedan's prospects in China, the world's largest auto market and the jewel in the crown of top luxury automakers like Audi, Mercedes-Benz, and even Bugatti and Rolls-Royce.
Prior to the unveiling of the Panamera Turbo on April 20th, several blogs, including the former iteration of Jing Daily, maintained this same level of optimism, noting that the popularity and prestige enjoyed by companies like Porsche in the Mainland market would mean that anything produced by Porsche and sold in China would be a hit. As we wrote at the time, the Panamera -- along with 12 other new models -- was, seemingly overtly, designed with the Mainland market in mind:
Recession be damned, Porsche is set to debut their new Panamera Turbo at the upcoming Shanghai Auto Show. Cash-rich Shanghainese and auto aficionados alike will get a glimpse of the new sedan -- which has so far received lukewarm reviews from auto publications -- on April 20th.
In addition to the Panamera, 12 other cars will make their debut in Shanghai, including two new BMWs and the Audi A3 (sure to be a hit in China, land of the government-owned black Audi sedan). This year's Auto Shanghai event is promoted by organizers as the biggest yet, apparently surpassing the scale of the Geneva and Detroit Auto Shows.
Since then, the Panamera has become available throughout China, launching recently in Xiamen, and as expected, it isn't cheap by any means. As China Car Times notes:
The Panamera starts at a whopping 1.84 million RMB (US $269,558) for the Panamera S model, whilst the Panamera 4S is 1.92 million (US $281,278) and the Panamera Turbo tops the range at 2.49 million RMB (US $364,782).
While the brand prestige of Porsche should, in itself, propel the Panamera to some success in the China market, it won't be without its challenges. For one thing, its high price point places it among tough competitors who have a proven track record in China, models like the Mercedes S class 500L (2.09 million RMB) and Audi A8L 6.0 W12 quattro (2.5 million). If the Panamera is going to have a fighting chance in China, Porsche is going to have to appeal to the crowd who would be considering a top-of-the-line Audi or Mercedes. The runaway popularity of Mercedes' S-class, and the launch of other 4-door sedans by BMW (750i) and Maserati means the market for sporty four-door sedans in China is getting more and more crowded.
Mercedes has made China a top priority this year, particularly as its traditional markets have faltered. By launching new initiatives in China, such as this month's new "StarElite" pre-owned sub-brand, Mercedes has worked hard to make it clear to potential buyers that its focus on the China market is not simply driven by the pursuit of easy profits; they're trying to show their true commitment to brand-building.
Audi, too, has a long pedigree in China, and is regarded as a mark of both luxury and success in all major urban markets. While Porsche, too, enjoys the enviable reputation of these two competitors, its first foray into the four door sedan market is difficult because it is, in many ways, a fish out of water. Porsche will have to convince potential buyers of other sedans that it will provide them both the horsepower and comfort they would expect from established models like the S-class or A8.
Another, more superficial, challenge faced by the Panamera in China is its awkward name. While this will certainly have little effect on sales, if the customers can't pronounce your name, they might be less willing to talk up your new model or buy it themselves. Admittedly, the name "Panamera" is a bit of a mouthful, as HuaShang (Chinese) jokingly noted:
This new car's name is a little awkward-sounding, and will be a bit of a challenge for people to pronounce, but let's forget about language constraints and enjoy [the Panamera]!