Porsche is making the car that is responsible for half its profits in Bratislava, reports the FT

Porsche is set to completely manufacture a car outside Germany for the first time, marking a departure from its proud brand claim that all its vehicles are “Made in Germany”.
Matthias Müller, Porsche chief executive, said on Tuesday that after 2016 the next generation of the Cayenne SUV – a vehicle that currently accounts for roughly half of Porsche sales – will be manufactured entirely in Bratislava, Slovakia.
The decision was taken as part of a reorganisation of production within Porsche and the wider Volkswagen Group.
Currently much of the Cayenne – including the bodywork – is made at a facility in Bratislava but the final assembly takes place in Leipzig.
Most German carmakers have long since abandoned the idea of producing all their vehicles in Germany and have opened production facilities overseas to be closer to fast-growing markets.
However, Porsche – maker of the 911 sports car and Panamera saloon – had partly resisted that trend because the “Made in Germany” label was considered a core part of its corporate identity and marketing.
Car buyers in emerging markets are prepared to pay a premium for German, UK and Italian engineering, and premium carmakers therefore tend to have reservations about setting up overseas.
For example, VW spent £800m last year to upgrade its factory in Crewe and keep Bentley models “Made in Britain”, rather than building its new SUV model in Slovakia, which would have been cheaper.
Fiat, owners of Porsche competitors Maserati, have also pledged to invest in their Italian factories to ensure that the sports car brand remains Italian-made, despite cost worries. Companies such as Rolls-Royce and Ferrari make their national identity the centrepiece of their sales pitch.
VW’s Bratislava plant produces the VW Group’s large SUVs such as the Touareg and Audi Q7. Therefore VW stands to derive significant synergy and time savings by manufacturing the Cayenne in its entirety in Slovakia, where labour costs are also lower.
Mr Müller said that for customers the decisive factor is that all Porsche vehicles will continue to be designed and engineered in Germany and noted that within the VW Group all production locations have to achieve the same high standards.
Porsche sales jumped last year by 15 per cent to more than 162,000 vehicles and it has become a big generator of profits for VW. Porsche is expected to be boosted further later this year when it launches the Macan compact SUV.


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