Detroit Auto Show: Porsche: We Expect Two-Digit Car Sales Growth In 2003

DETROIT January 7, 2003; Dow Jones reported that Porsche AG's executive vice president for sales and marketing said Tuesday that orders in the U.S., its most lucrative export market, are improving.

"We have a relatively good order bank," Hans Riedel told Dow Jones Newswires and German news agency VWD in an interview at the North American International Auto Show. "We see the beginning of a recovery in the U.S."

This may be comforting news to investors after the German luxury sports car maker said Friday its North American vehicle sales plunged 22% on the year in December.

As for global vehicle sales, Riedel said the new Cayenne sport utility vehicle makes Porsche confident of strong sales and earnings growth, even if potential negative economic or geopolitical factors weigh on auto demand.

"We will still have at least double-digit vehicle sales growth in 2003, even if there are small drops in our core business," Riedel said. Strong earnings growth should follow, he said.

The Cayenne will also help boost sales and earnings further beyond 2003, he said.

He declined to be more specific about demand for the Cayenne, but early last month, Porsche said it had already pre-sold at least a year's worth of production - 25,000 units - and had about 170,000 seriously interested potential customers.

Porsche expects to sell more than half of its Cayenne output in the U.S.

Fred Schwab, President of Porsche Cars North America, told reporters earlier Tuesday that the Cayenne should double Porsche's yearly vehicle sales in the future, stealing Porsche fans away from rival SUV makers.

He said North American Porsche dealers have already invested about $300 million in facilities to sell the SUV.

"(The Cayenne) will provide us with the sales to remain independent," Schwab said. Industry watchers have questioned whether Porsche could stand alone as such a tiny player.

Initially, some analysts had doubted the Cayenne's prospects as it's Porsche's first foray beyond sports cars - upsetting some Porsche loyalists - and will result in unprecedented fast growth that some worried could be hard to manage.

Separately, speaking about the Carrera GT - a high-powered sports car Porsche said it would start selling this year - Riedel said: "Demand has continued to develop well."

Porsche still hasn't finalized pricing, production plans or a launch date, he said. But the Carerra GT could cost up to EUR400,000 and Porsche expects to sell around 1,000 a year.

A year ago, Porsche Chief Executive Wendelin Wiedeking told Dow Jones Newswires anxious potential drivers were already making $40,000 downpayments on the car.