LA Auto Show: 2015 Porsche Macan

Wow, this thing goes to $100,000 in no time after adding Porsche-esque options. Cayenne GTS lightly loaded becomes a better option.

Wow, this thing goes to $100,000 in no time after adding Porsche-esque options. Cayenne GTS lightly loaded becomes a better option.

But that's exactly the type of choice Porsche can now offer: smaller fully loaded model or larger with less content. More options should bring in more people (in theory at least).

Wow, this thing goes to $100,000 in no time after adding Porsche-esque options. Cayenne GTS lightly loaded becomes a better option.

But that's exactly the type of choice Porsche can now offer: smaller fully loaded model or larger with less content. More options should bring in more people (in theory at least).

More options or cannibalization?

People doubt GM's strategy for price overlaps through the breadth and depth of its product lineup, but this is okay because it gives theoretically more options?

This will cannibalize their only faithful sales to the Cayenne. Here I have to say that while the engineering chops are impressive, I think Marketing forgot to keep this small er CUV in it's proper place.

My gut tells me they will rush a refresh of the Cayenne to market next year after this kills off sales.

And raise the price

Wow, this thing goes to $100,000 in no time after adding Porsche-esque options. Cayenne GTS lightly loaded becomes a better option.

But that's exactly the type of choice Porsche can now offer: smaller fully loaded model or larger with less content. More options should bring in more people (in theory at least).

More options or cannibalization?

People doubt GM's strategy for price overlaps through the breadth and depth of its product lineup, but this is okay because it gives theoretically more options?

I'm willing to bet they'll make more money on the high priced Macans (Porsche and other German brand option/packages prices are shocking), so even if in terms of the number of units there is some cannibalization, the profit per unit sold will be bigger. It's clever overlap, not the kind of overlap that had various GM brands offering essentially the same content at roughly identical price points.

Wow, this thing goes to $100,000 in no time after adding Porsche-esque options. Cayenne GTS lightly loaded becomes a better option.

But that's exactly the type of choice Porsche can now offer: smaller fully loaded model or larger with less content. More options should bring in more people (in theory at least).

More options or cannibalization?

People doubt GM's strategy for price overlaps through the breadth and depth of its product lineup, but this is okay because it gives theoretically more options?

I'm willing to bet they'll make more money on the high priced Macans (Porsche and other German brand option/packages prices are shocking), so even if in terms of the number of units there is some cannibalization, the profit per unit sold will be bigger. It's clever overlap, not the kind of overlap that had various GM brands offering essentially the same content at roughly identical price points.

I am not doubting that it will not make profits on a tarted up Audi Q5 tagged as a Macan. How is that essentially different than the strategy of a Tahoe and Escalade? And vertical overlaps within the same brand is not indifferent than horizontal overlap among different brands of the same manufacturer, so as long they make profits, is it? Again cannibalization will take place in a horizontal overlap also, but it is profit that matters, right?

Sounds like a $60,000 Audi Q5. At least it has 400 HP, that makes it a Porsche in the performance area. I think they should make a rear engine crossover based on the 911.

Wow, this thing goes to $100,000 in no time after adding Porsche-esque options. Cayenne GTS lightly loaded becomes a better option.

But that's exactly the type of choice Porsche can now offer: smaller fully loaded model or larger with less content. More options should bring in more people (in theory at least).

More options or cannibalization?

People doubt GM's strategy for price overlaps through the breadth and depth of its product lineup, but this is okay because it gives theoretically more options?

I'm willing to bet they'll make more money on the high priced Macans (Porsche and other German brand option/packages prices are shocking), so even if in terms of the number of units there is some cannibalization, the profit per unit sold will be bigger. It's clever overlap, not the kind of overlap that had various GM brands offering essentially the same content at roughly identical price points.

I am not doubting that it will not make profits on a tarted up Audi Q5 tagged as a Macan. How is that essentially different than the strategy of a Tahoe and Escalade? And vertical overlaps within the same brand is not indifferent than horizontal overlap among different brands of the same manufacturer, so as long they make profits, is it? Again cannibalization will take place in a horizontal overlap also, but it is profit that matters, right?

Because the price overlap here is between a higher end smaller car and a lower end (relatively sepeaking since this a Porsche) bigger one. It's not selling the same car 5 times over in the same price points (which GM did for years - Tahoe and Escalade are not Old GM in that regard). This allows for an actual choice: smaller with more goodies or something bigger but with less goodies; with the added 'bonus' of having a higher profit per unit on the smaller one given the obscene option pricing by Porsche. IMHO this is the Alfred Sloan way done the right, this is how stair step pricing should be done.

Okay let us skin the cat a little differently. Porsche Cayenne S with 400hp engine starts at 66,800, while the Porsche Macan Turbo starts at 72,300 with the same hp engine (granted a different layout and has standard the PASM). This is still illogical. Imagine the conversation between a desperate housewife and salesman trying to keep straight face in telling why a smaller car with not too much more in standard equipment actually costs more than a larger car.

Porsche's intent with this vehicle is volume to keep it from losing money. And if it wants volume with this vehicle, then going at a lower price and yet keeping a health price delta between the two SUVs will work more economically. It may work in short term, but the strategy is going to hurt Porsche in long term.

If smaller with more goodies or something bigger with less goodies with added bonus of having higher profit per unit on the smaller one is the elixir of automotive industry, then the BMW should be charging 74,000 for a decently loaded 335i on par with the 740i and then by keeping slew of greedily charged options bring it to the levels of 750i.