[CarreraS2]

Was totally predictable to me (and in fact was predicted by me), since it is a vehicle that makes absolutely no sense, but Cayenne sales are already in the tank.

The first quarter 2005 sales figures are out. Cayenne is down a whopping 25% from the first quarter 2004.

That is a scary number. Normally, sales a new car gradually increase each year for the first 4-5 years, then taper off as the market anticipates it's replacement coming out.

For the Cayenne to take this big of a hit, this early, spells certain disaster for Porsche. There simply is NOTHING they can do to increase sales. They have already reached into the well to do the one thing they could do- make a cheaper model to tap the "poseur" market. They did that with the VW Golf engined 6 cylinder version. The "newness" and novelty of it has gone (Don't underestimate the force of that. Some people will buy anything to be the "first on the block." But the won't follow up by buying it again). There is, IMO, NOTHING Porsche can do to significantly increase sales. And, they will NEVER come close to the sales figures they projected and need to have for it.

This is a good example of corporate greed resulting in a very bad outcome. Normally, I would say that "corporate greed" is a concept that doesn't really exist - corporations should try to increase their value. But in this case, it was greed IMO.

You hear the absolutely silly argument "Porsche needed to make the Cayenne to stay independent." As I said here when the Cayenne first came out, if anything, the Cayenne will cause Porsche to LOSE it's independent status. Here's the irony. Porsche didn't need the Cayenne to save it from financial ruin. IT WAS THE MOST PROFITABLE CAR COMPANY ON THE PLANET! In fact, it's extreme profitability lead to the bizarre decision to make the Cayenne, IMO. Porsche had huge cash reserves. The proverbial "money burning the hole in your pocket." It paid for a lot of the Cayenne start up costs with cold, hard cash.

I think Porsche say what GM, etc. was doing in ripping off the public selling low budget pickup trucks with shells welded on them and some leather thrown in (i.e., the "luxury SUV") at HUGE profits. Although Porsche was doing spectacularly well, it just had to try to get in that SUV profit feeding-frenzy.

Problem is, however, Porsche underestimated the fickleness of the American consumer, and how long the SUV fad had been going. They were 10 years too late to the SUV profit party.

Add to that the Cayenne is a weak, unimaginative, anonymous, boring looking vehicle. Add to that the fact that they helped make their own competition, which is better than their vehicle (a V8 Toureg is better than the V6 Golf-engined Cayenne, for the same price), and disaster is guaranteed.

When it came out, Porsche execs said at the Porsche Parade that "The future of the company depends on the success of the Cayenne." I sure hope he was just trying to twist some arms to buy the thing. Because if that is true, the company is toast.

(BTW, sales of the Boxster and 997 are doing very well, as will be the sales of the Caymen).