I thought this bit was interesting, Porsche and the US dollar

markstudy · #1 (**permalink**) 05-16-2008, 01:13 PM

I thought this was interesting- From Porsche spokesman Albrecht Bamler

"Bamler said Porsche is protected against the financial effects of the weak dollar through currency hedging until 2013".

From article- Porsche won't build SUV's in USA
Porsche denies U.S. Cayenne production - AutoWeek Magazine

**chows4us** · #2 (**permalink**) 05-16-2008, 07:14 PM

Interesting. See Hedge (finance - Wikipedia, the free encyclopedia)

Then if true, I would not expect huge price increases through 2013.

**Chris S** · #3 (**permalink**) 05-16-2008, 11:57 PM

Quote:

Originally Posted by chows4us

Interesting. See Hedge (finance - Wikipedia, the free encyclopedia)

Then if true, I would not expect huge price increases through 2013.

Porsche prices according to what they think the market will bear, not on a cost + basis. If the comp. raises prices, I'm sure they'll do the same to take advantage of the opportunity.

SCOPPOLA · #4 (**permalink**) 05-17-2008, 02:06 PM

I'm not a finance expert, but it seems to me that unless their hedging is somehow directly linked to selling cars in the US, it will not change the fact that they can make a lot more money selling cars elsewhere.

**Chris S** · #5 (**permalink**) 05-18-2008, 12:09 AM

Quote:

Originally Posted by SCOPPOLA

I'm not a finance expert, but it seems to me that unless their hedging is somehow directly linked to selling cars in the US, it will not change the fact that they can make a lot more money selling cars elsewhere.

You're right - if they don't bring in the hedged amount of US$, they likely end up w/ a FX gain. Still, they shouldn't just re-allocate production based solely on current relative profitability, since that could bite them in the long run. The US is their largest market, and it would be short-sighted to consciously drive down market share just b/c of the $.