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Automakers paying Chinese dealers for lower-than-expected sales

The Chinese dealers vs. foreign manufacturers story won't quit. It began with a story on the struggles faced by FAW-Toyota joint venture dealers, with supposedly 95 percent of the showrooms losing money, and 10 percent of them doing so poorly that they'd have to exit the business. The problem is mandated sales targets, most set when the country's economy was racing. Now that things have slowed, China's dealers are swimming in unsold cars and the costs to keep them. In the case of FAW-Toyota, dealers asked Toyota to hand over 2.2 billion yuan ($355 million) to help address the situation. That was followed by a report noting the issues that Honda, BMW, and Nissan dealers are having with the same issue, revealing that the Chinese Automobile Dealers Association (CADA) had taken the highly unusual step of writing to the Chinese government to complain. Now Reuters reports that CADA is not only pressing its case even harder, it's being open about it: it announced that BMW agreed to pay dealers 5.1 billion yuan ($820 million) to alleviate poor profits last year. Unnamed sources said Audi has thrown 2 billion yuan into the kitty for subsidies, and Daimler has contributed "about 1 billion yuan" to its dealers. The battle isn't just about 2014, but how business will be run in 2015 as well: Chinese Porsche dealers have requested the automaker lower its 2015 target of 64,000 cars, which would be a 40-percent increase on its 2014 sales of 46,931 vehicles. One analyst called it "shocking" that the CADA has taken its fight public, while CADA comments continue to imply that dealers have been railroaded to the cliff's edge without recourse. "Due to the difference in status," it's deputy secretary said, "individual dealers are not willing to, or don't dare to, talk frankly with the carmakers...." Both parties need one another, so they'll figure out a way to make it work – but that could mean acknowledging the Chinese market is behaving more like a mature one, not an emerging one. News Source: ReutersImage Credit: Lintao Zhang/Getty Images Earnings/Financials Audi BMW Porsche Toyota Car Dealers Luxury

Porsche to decide soon on Bugatti future

WEISSACH, Germany — Volkswagen will soon decide on the future of its luxury brand Bugatti, Oliver Blume, Volkswagen management board member and CEO of Porsche AG, said on Monday. Last week, Reuters reported that Bugatti was working on a strategic partnership with Rimac, which will likely result in a joint venture between Porsche and Rimac, with Porsche as a minority partner, Volkswagen CEO Herbert Diess said in March. "The future of Bugatti is an issue that will be decided on a group level," Porsche said in a statement, declining to comment further. Porsche boss Oliver Blume earlier this year said intense discussions on Bugatti's future were ongoing and that Rimac could play a role as the brands were a good technological fit, adding that a decision was expected in the first half of 2021.  

A beastly 1979 Porsche 930 is unleashed by Petrolicious

The 911 Turbo held a special place in Porsche's lineup for decades. Much of the mystique came from its performance potential, but that huge capability also required a deft hand and foot to keep things in check. These days even the most basic 911 packs turbos, but Grant Karnes and his 1979 Porsche 930 demonstrate why the early models remain classics in the latest video from Petrolicious. Karnes says he gets attention from everyone he passes in his 930, and it's easy to understand why. Even before the coupe comes into view, the upgraded, turbocharged engine pops and crackles with a wonderfully raw sound. People then see the Porsche's classic combination of wide fenders and a big rear spoiler. Karnes also adds a vintage racing vibe with Martini decals on the hood and doors, and his license plate tells folks exactly what kind of machine this is. Plus, if you happen to spot this car at night, the exhaust can shoot bursts of flames. Porsches are a fairly common subject in Petrolicious' videos, and they run the gamut from well-worn classics to heavily modded canyon carvers. Karnes' 930 leans more in the latter direction but still maintains a vintage look. He promises the coupe is always exciting to drive, and this clip does a fantastic job of showing why. Related Video: