100m euros invested in car dealers

The dealer network of the leading domestic automotive importer Porsche Romania will attract 100 million euro investments for development until early 2007, in order to cope with the ever-increasing competition.

“We have invested 1.6 million euros in 27 automotive centres on the average over the last eighteen months. A further about 50 million euros will be invested in 30 more centres in the eighteen months until the anticipated accession of Romania to the European Union,” Franz Fruhwirth, general manager of Porsche Romania stated.

The investments will sustain development of the company”s business over the next few years, as the decision to buy a car is putting an increasingly stronger emphasis on the service package offered by the dealer.

“The actual sale of the vehicle is no longer the only variable that needs to be taken into account. Given the access to a broader market, only that car dealer will remain profitable, which offers post-sale services, state-of-the-art fast service network, immediate delivery of original spare parts, buy-back and flexible funding systems,” specified Brent Valmar, a chief executive with the company and chairman of the Association of Automotive Manufacturers and Importers of Romania (APIA). He says the current profitability of the dealers in the Porsche Romania network is of about 4-4.5%; the percentage varies depending on the location of each specific dealer and the brands it represents.

Porsche Romania, which made 300 million euro turnover last year, saw sales grow by more than 70-75% in the first half compared with the same time last year, overshooting the 13,500-unit mark. The growth is slightly higher than the booming growth of the automotive market in the same period.

“We are pursuing a 30% share of the market of imports,” Valmar added. He anticipates a recoil might be in order after the spectacular growth of the domestic automotive market.