Maserati reinvention to rival Porsche

Maserati reinvention to rival Porsche
At the Geneva car show, Maserati presented a prototype of the sporty two-seater, which Mr Marchionne said 'could complete the Maserati line-up'.

MILAN - As Fiat Chrysler moves to reinvent its small Maserati brand as a serious rival to the world's luxury car makers, the pressure to succeed is all the greater for the startling success of Germany's Porsche.

The German sportscar maker has set the standard for multiplying sales of an expensive brand without damaging the exclusive image that reaps big profits.

Fiat Chrysler Automobiles chief executive Sergio Marchionne wants Maserati to be for the Italian automaker what Porsche is for its parent company Volkswagen - a formidable source of profits that is less vulnerable to swings in the economy than the group's mass-market brands.

Maserati has Italian allure and a recognised sporting heritage. But Fiat Chrysler, the world's seventh-largest auto group, sold just 15,400 of the growling, muscular sportscars last year - not yet enough to change the group's fortunes - compared to Porsche's sales of over 160,000.

Porsche's 18 per cent automotive operating margin - the rate of underlying profit on its sales - has made it a more valuable company than rivals selling millions of cars each year. Even in the premium sector, the average margin is only 10 per cent.

Porsche contributed less than 2 per cent of VW group sales last year, but about 22 per cent of its operating profit. Maserati's trading profit tripled last year, but still contributed just 5 per cent of Fiat profits and less than 2 per cent of sales.

By next year, Mr Marchionne wants to be selling 50,000 Maseratis. The goal hinges on a rapid take-up of new models designed to appeal to a broader variety of driver tastes and budgets.

Maseratis are priced at around a 20 per cent premium over similar-sized rival German cars, so the product offensive must not cheapen the brand.

Porsche managers faced the same dilemma two decades ago when they were mulling a cheaper sportscar to complement the 911.

The Boxster took wing in the face of deep scepticism among Porsche fans disappointed by previous failures to develop a worthy stable-mate for the 911.

An earlier 928, which broke with Porsche's tradition of rear-engine layout, had a quirky, rounded form and pop-up headlights and shared few parts with the 911. It never matched the 911's popularity and production was halted in 1995.

The Boxster blew away expectations because its styling, engineering and performance were not dramatically different to the 911, but the price made it accessible to far more customers, thanks partly to more common components shared with the 911.

It gave Porsche the confidence, and the expertise in cross-platform manufacturing, that later informed the Cayenne and the new Macan sport-utility vehicles that broke with the brand's pure racing, two-seater sportscar heritage.

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