Reving the Investor
The Project One car was a good use of Diamler’s capital relative to
its other production lines. That is because performance cars have been
quietly revving up the bottom lines of carmarkers. And 2018 may be the
year that investors take notice.
First, consider Mercedes’ performance car line, AMG. These cars
represent only one in every 20 cars sold by parent Daimler, however, they
are showing remarkable growth. In 2017, about 140,000 were sold, about
one-third more than in 2016 and triple the number just three years earlier.
In 2018, similar growth is expected. At rival BMW, the growth of its
performance line, M, has also been far higher than the rest of the
company’s cars, albeit a little behind AMG’s growth rate.
With this kind of growth, performance car sales by mainstream
car brands are quickly catching up with the sales of pure-play performance
brands. If we compare Mercedes’ AMG line with Porsche, four years ago,
the 30,000 AMG cars sold was equivalent to just one-fifth of Porsche’s
unit sales. In 2018, the 180,000 expected to be sold will be the equivalent
of about three-quarters of Porsche’s production.
EU Forecast
euf:b18:109/nws-01