Porsche gives more transparency on supply

Following a request by the Porsche Board of Regents, Porsche last year shared more vehicle supply records to dealerships, providing retailers with more certainty they were being treated fairly during a product shortage.

"It was a real good move for Porsche," dealer council Chairman Mike Sullivan told Automotive News in December.

When an automaker sells only 70,000 vehicles during a year, the disposition of even a small number is relevant to a dealer, said Sullivan, managing partner of LAcarGUY group and dealer principal of Porsche South Bay in Hawthorne, Calif. The council told Porsche that too much ambiguity existed about the critical issue of allocation, according to Sullivan.

"And if somebody does't understand it completely, then they have to wonder," he said.

The council suggested Porsche offer more perspective to retailers.

"They've been incredibly transparent with us," Sullivan said. Dealerships now have an idea of how many vehicles are set aside for other purposes, such as auto show cars or press demos, before the remainder are allocated to retailers, he said. Individual allocations are based on dealership sales, Sullivan said.

Porsche also has been improving transparency regarding which vehicles it is building. Dealerships can modify orders to better match what's coming off the line.

While retailers typically don't like the message that "inventory is limited," Porsche dealers have been able to understand it, manage it and provide similar transparency to customers, according to Sullivan. He said it helps dealers negotiate "that natural angst that a guest has" — the fear that another buyer might be able to pay for an advantage.

Porsche and its dealers do prefer supply to be what they call being "one short," Sullivan said. But right now, it's more like "10 short," and retailers need more inventory, he said.

Last year saw light inventory and good margins, Sullivan said. But dealers saw a decent flow of "bread-and-butter" Porsches. And buyers of special vehicles, such as the GT3, tended to be anxious rather than angry about waiting for a vehicle they wanted rather than needed.

"It was a great year for the dealer," Sullivan said. But supply is unlikely to return to the "one short" level in 2023, he added.

"We'll still be light next year."