Will Porsche Enter Production Hell For Taycan?

JUL 28 2018 BY VANJA KLJAIC 67

Difficult challenges lie ahead for the production facility staff at Zuffenhausen

Porsche is entering the fully electric vehicle scene with a bang. The Porsche Taycan – their first all-electric vehicle – is slated to feature all of the high-performance traits known by this legacy car maker. The vehicle comes listed with a 0-60mph (0-97km/h) time of just 3.5 seconds, a top speed of 155mph (250km/h) and it will feature a range of 310 miles (500 kilometers) per charge. It’s basically an electric Porsche that we’ve all been waiting for. While the vehicle is slated to be revealed next year, Porsche’s already revealed an increasing interest in this all-new electric vehicle.

The Taycan sits fully on Porsche’s new vehicle architecture known as J1 and features some impressive tech. According to the Stuttgart based carmaker, the Taycan is set to have 800V charging, allowing it to reach an 80% battery state in just 15 minutes. While the interior layout suggests a four-seating layout, we’re more keen on believing it will be slightly larger than a 911, but pretty much smaller than a Panamera.

Earlier this month, Porsche Managing Director Alexander Pollich revealed that the upcoming vehicle has so far been receiving great reception throughout the automotive world. Porsche aims to start producing the Taycan at their Zuffenhausen plant someplace during next year. The historic site encompasses several production facilities (where the Porsche 911, Boxster, and Cayman are made), the Porsche Musem and several other administration facilities.

Porsche’s goal is to produce 20,000 Taycans every year at their Zuffenhausen production site. But, starting and ramping up production for an all-electric sedan will require some compound changes at their Zuffenhausen facility. After all, the rather burdened production lines where the 911, 718 Boxster, and 718 Cayman are made, need to remain running at full capacity. This poses an organizational, financial and time issue for the carmaker, best described by Albrecht Reimold, Porsche’s head of production, released in a statement to Dutch car magazine Vroom.

“Finding the right location is a difficult decision. Transforming the existing factory costs a lot of money, moving to a new location as well. Transforming a factory while the production lines are running at full capacity is not an easy task.”

This was further explained by the project manager David Thor Trygvason, as he reveals that the entire production line and the facility where they intend to produce the Taycan, will need to be overhauled to satisfy the particular requirements set forth by this new vehicle. Even if we push all of these problems aside, Porsche set the estimated timeline for the project for just 48 months. In turn, this makes the project quite costly and even particularly demanding.

“The existing location has to be demolished and rebuilt in a short time, but at the same time the production of the 911 and 718 Boxster and Cayman must continue to run. That makes it not only difficult in terms of time and money, but also in terms of logistics and mobility. After all, we are in a location where there is already a factory, where other companies are nearby and where people live nearby.”

But, even pressed with such difficulties, the Porsche employees answered with zeal. Reimold reveals how the Porsche employees conveyed a clear-cut message and commitment to begin the production of the all-electric Porsche Taycan on time, and as early as possible. They’ve even opted to keep their salaries flat until 2026, in order to help finance the factory. This means that no regular salary increases will be seen by Porsche workers over the next few years, but they will get to see a return of their investments later on. Overall, this just goes to show you how much trust their employees have with the company.

“We have agreed with them to invest a part of their wage increase until 2025 in the construction of the new factory. From 2026, they will simply receive their investment back,” Reimold said.

In the end, the Taycan will certainly shape up the future for Porsche. After all, the Stuttgart based carmaker even dubbed the Taycan as one of the company’s most important vehicles after the iconic 911. In turn, sacrifices will have to be made. It’s going to be a struggle until the production ramps up. The same struggle experienced by Tesla, when they set up their Model 3 production lines alongside those of the Model S and Model X.

For Porsche, however, this “production hell” – as Musk dubbed it – might be even worse, thanks to a mixture of ICE (Internal Combustion Engine) and electric vehicles, all featuring a magnitude of models, versions, and trims. But Porsche does well under pressure and we’re confident that when all is set and done, the Taycan will be coming out of the Zuffenhausen production plants in the same steady stream of cars, just like the 911, the Boxster and the Cayman do these days.

Source: Teslarati

Categories: Porsche

Tags: , ,

Leave a Reply

67 Comments on "Will Porsche Enter Production Hell For Taycan?"

newest oldest most voted

So the author expects Taycan to be only marginally bigger than a 911…Maybe, that would be consistent with the 20k/year production run that’s a lot smaller than its supposed rival Model S. Limited practicality would limit demand, as will the fact that the high capacity infrastructure for this car is years away from having decent coverage.

Can’t believe Porsche is making its employees foot the bill for this project btw, no wage increases for 7 years should reduce their purchasing power by some 30% over that period.

The natural competition is the Model 3 PD. Same size and performance.

At 1/2 to 2/3 of the price, and a lot fewer buttons.

Are you saying those who appreciate sports should be properly distracted by a screen?

I have both a Porsche and a Model 3. If you’re are not a distracted driver to begin with, there will be no distraction in the Model 3.
Since the Model 3 doesn’t have a tachometer and other gauges relating to the engine and transmission, the only thing the driver needs to pay attention to while driving is the speed. Any decent driver would know that you don’t need to have your eyes glued to the speedometer to know how fast you’re driving. A 2 o’clock glance to the Model 3 screen for the speed will take 0.5 second top. The numbers are displayed in large font, you can’t miss it.
As for other controls, many important settings are set and forget. Searching for music, making a phone call or navigation are just as distracting on the Model 3 as on any other car on the road. Besides, voice commands work well on the Model 3.

Don’t blame the car for your poor driving habits.

Employees are not footing the whole bill, but you have a point, Porsche is a very rich company with great profit margin. However don’t compare it to the US situation.

Porsche employees are well paid and have high job security through unions. Minimum wage and hiring / firing like in the US are not possible on the German market. A Job cut like Tesla‘s would take Porsche years to consolidate, not a 1 month notice. Likewise the inflation is traditionally around 2% unlike the US. Also most employees are paid bonuses at the end of the year regardless their positions and stock options. This can be lucrative if you are a worker on the assembly line compared to your annual income.

A bit of a particular side note: what is most Telling of Tesla’s Lay Offs was the choice of 9% of Total Staff! It may be under different rules in California’s Labor Laws, but at 10% of total staff, or higher, getting Laid Off, in Ontario, there is a specific Pay Out or Notice period of 16 Weeks, or Pay-In-Lieu, as our Company discovered once, by “Accident!” I figure it is similar in CA, and they knew the law, so that set the limit at 9%! That would sit well, and better, with trimming costs, in preparation for Q3 Profitability, than a 10%+ Lay Off. If rulles are similar, since a shorter Notice, or Pay In Lieu period, would be required.

California is a right to work state and has no 10% threshold written in the laws.

Seems a bit silly on the surface, what material difference does it make to the employees if they are part of a 9% or 10% layoff? Will they suffer more because more of their colleagues are let go?

“Porsche is a very rich company with great profit margin.”

I don’t know how “rich” Porsche is or isn’t, but the relatively high profit margin is misleading. Specialty auto makers with relatively small production runs have to have a higher profit margin than larger auto makers which make best-selling car models, just to stay in business. Car makers with more popular, higher-selling models benefit from the economy of scale, which for them more than makes up in volume what they lose in percentage profit.

A smaller auto maker like Porsche, making only higher priced (and higher cost) cars, has to use more of its income on fixed expenses, including worker salaries, factory maintenance, and “keeping the lights on”, in addition to having a higher cost for parts, both due to making cars more luxurious than average, as well as the higher price for parts from a smaller production run.

Why in the name of $$%%% are we questioning Porsche’s financial prowess compared to Tesla, a company that has never seen the light of profit, but is mired in no-profit fiscal hell instead?

Because this isn’t a discussion, this is a bunch of religious fanatics screeching, “heresy!”

You are just as fanatical against Tesla.

Porsche is not a small niche company. They posted 24bn euro in sales and over 4bn in operating profits for 2017. They sell over 250k cars a year. This might be small compared to their parent VW, but it’s not niche. Actually at some point they tried to buy out a company with 6m car sales a year, although that went south in the end.

“Likewise the inflation is traditionally around 2% unlike the US.”

I recommend you double check that.

Inflation in Germany has been at 2% or lower for the last 10 years. So Inflation eating you salary is not a major concern. Agree it hasn’t been high in the US either lately.

more like 19%. and porsche is already paying very high loans. so it’s more like we get closer to average but are still higher than average by recognisable amount.

If you believe official inflation numbers it’s not too bad but “quantitative easing” is as much a thing in the Euro zone as it is in the US so real inflation is no doubt a lot higher than is officially admitted.

Well, I WAS paying High % and High $ in Credit Card Interest on Carried Balances last year, but with some “Shuffling of the Deck”, was able to 1st cut interest to under 4%, then to 0%, via Balance Transfers, and Lump Sum Payments, which has greatly accelerated their pending pay out, so maybe Porsche could find a way to restructure those loans to gain some similar benefits!

We need as many sizes and shapes in EV’s as there are in ICE cars, so I don’t have a problem with this.

Right! 20,000 a year is smaller numbers than Tesla’s 50,000 per year Model S or Model X lines, and a lot smaller than what seems, performance Specs wise, its closest competitor, the Model 3 Performance Loaded, at what may be up to 2,000-3,000 per week, or 100,000 to 150,000 per year, but either way, Porsche Taycans likely replace More Porsches than Tesla’s, so a Win for EV’s is still a Loss for ICE’s!

1. “No wage increases for 7 years” – link? “Part of” does not mean, “none.”
2. Maybe they can raise their wages if the feds would give them $5b/year in subsidies like it does to Tesla?

“Zuffenhausen plant someplace during next year.”
We already know the place maybe you meant sometime next year.

I don’t see where the author gets that Porsche will be in some kind of production “hell”. Do you mean that they will encounter similar unexpected problems just as Tesla did? From the given quotes I can only read that Porsche sees the development of a new Taycan line as challenging but I don’t see that they expect to run into problems, particularly not with the ramp up.

I came to the same conclusion. Nowhere in this article is there any suggestion that there will be production issues. It sounds to me that they’re building a new production line specifically for EV’s and the difficult part is building it in time, not optimizing production. Porsche already knows how to produce cars efficiently and they aren’t trying to invent some sort of new production strategy. I don’t see the issue.

Not all cars are the same and Porsche doesn’t built all that many cars and barely any BEVs. If GM didn’t reach their 2017 Bolt target and Jaguar delayed the I-Pace due to manufacturing issues and Tesla had issues despite smoothly making 100,000 long-range EV’s a year, I think it’s fair to expect that they’re going to have more issues than time if they’re on such a short schedule and they’re trying to cram it out of a working factory.

It builds three BEVs – Cayanne PHEV, Panamara PHEV, 918 PHEV. So, more than “barely any.”

Porsche is going to have issues ramping up as they have to either convert existing factories or build new ones. Both efforts take time in Germany and likely, when done, will have limited production numbers. I am not sure how much battery sourcing they have actually reserved to date. Since almost 40% of EV parts are differnt from ICE, the sourcing/manufacturing of those in quantity will certainly not be easy or fast…expect some delays.

At this point, they might not see any issues either, but “Production Hell”, for Tesla, was also about a Push to making High Volume Production, when internally, they were only used to Medium Volume Production! Plus, 20,000 units per year, is about only 385 units a Week! Much easier for Porsche to reach that, than for Tesla to hit 10,000 a week, or even the steady 5,000 per week! So, maybe just a much easier “Production Difficulty”, will be Porsches experience!

Yes. Calling this “production hell” is like trying to label any sort of political scandal, or even merely a misstep, no matter how trivial, as a “-gate”; as though every political scandal is as important as the Watergate scandal.

Elbowgate (2016): Canadian Prime Minister Justin Trudeau accidentally elbowed a female MP in the chest in the House of Commons, causing the opposition to accuse him of assaulting her.

If Porsche doesn’t gimp the Taycan, they will be caught in the hell that separates falling profits and unsatisfied demand. That is their future. Having to deliver cars with expensive content people want.

Porsche will be in “Production Hell”……. Guaranteed !

Get real.

Not a chance in Hell ‼️

The Taycan, like the rest of the Porsche lineup, will be low volume, due to the high cost. For the US/Canada, they move about 10k 911s a year, by comparison, Tesla moved close to 28k Model S. Then looking at the price with the base 911 starting at $91k, the base Taycan will start well over $100k. It’s going to be a low volume halo car for Porsche. Faster and better handling than anything they sell today but priced outside the range of most of their consumer base.

So I think Porsche’s production issues will be less urgent than with Tesla and the Model 3. More like it was with the launch of the Model S….does anyone remembers that model having production issues?

It’s going to be VWs entry into high volume EVs that will test their EV production capabilities. Because with Porsche, if they produce 200 Taycan models a day demand would be met.

I don’t know the exact numbers from memory — but it doesn’t sound like it will be any more “high volume” than the e-Golf…

There are Porsches way faster than the Taycan. Handling, we’ll have to see, and it can be subjective, but it seems unlikely the Taycan surpasses it’s high end stable-mates handling, which already set a very high bar.

They will be on thier consumer base. Porches can get very expensive with add on features all the way to 300k

They would have been better off, if they made Taycan a halo car, as you say. It’s too late to do the smart thing, and let price limit demand.

The strategy appears more geared at marking Tesla (&price) and stopping Porsche customers from conquesting. In my experience, many American Porsche enthusiasts are also Tesla owners. And the most frustrating thing about it is it’s the ones who know cars. A good number of instructors and members have tried Tesla, and these are the “car people” from whom many seek advice.

Taycan is actually supposed to start at ~$85K and to sell 20K units a year which seems reasonable considering that price.

Their USA & Canada Demand, sure, but 385 units a week is what it takes for the 20,000 per year goal!

So compared to Tesla Model 3 performance, Taycan has basically same performance metrics with only 4 seats, less intelligent software, barely any super charging network and higher price?

The Supercharger network is only really relevant in the US, which is not the only car market in the world.

To approach Model 3 range, Porsche is expected to be reaching for heavier per KWh cells, and more of them (~90 vs. 75). Model 3’s performance, construction and especially weight, were a broadside to Taycan development. I doubt it will deviate from a compelling answer to “Model S”.

1. “Same performance metrics” – there is more to a car than it’s 0-60 (dumbest metric ever for an EV – who cares if a car can 0-60 in 2.5 sec vs 3 sec? Oh, that’s right – ICE rednecks), and since no one has reviewed the Taycan, you have no idea if it shares the “same performance characteristics.”

2. “With only 4 seats” – lol

3. “Less intelligent software” – so you’ve reviewed both product’s code, and are knowledgeable enough to make this conclusion?

You Tesla cultist are really strange – it’s literally a religion for you, because it’s totally based on faith and not facts.

“We have agreed with them to invest a part of their wage increase until 2025 in the construction of the new factory. From 2026, they will simply receive their investment back,” Reimold said.

If someone at Tesla even remotely suggests this idea, the “public” and union mob would scream for his head.

VW and Porsche have a very long relationship with IG Metall union and even if the rethoric is sometimes tough they always come to mutually beneficial agreements when negotiating behind closed doors. Remember that German auto workers only work 7.5 hours per day and enjoy minimum 5 weeks paid vacation from the start, free health care, free University for their kids and have much higher productivity and standard of living than the typical US auto worker. They also make high quality cars that Americans want to buy and own. Funny how that works out?!?

So porsche is going to have production hell for just 20,000 cars per year and a price tag in Model S range. The Model 3 ramp is looking pretty good now. Isn’t it?

Another view could be:

So Porsche is not going to have production hell and Tesla is getting another competitor with a Porsche badge on it. The Tesla future is looking pretty bad now Isn’t it?

Only time will tell?

Meh, Tesla makes cars faster than Porsche. You can’t threaten what you can’t outproduce.

Is it? How do yo know? Did someone review the Taycan that I’m unaware of? What’s the S’s Ring time vs. the Taycan’s? Or do you mean 0-60 time, which is pointless metric given that any time under 4 sec is more than anyone could ever want or need on an open road. It’s like saying, “well, car x has a top speed of 1,000mph, and car z only 9,99mph, so of course x is a better car.” What a stupid, ICE-y metric, and it’s hilarious to see Telsa-ites hang their hats on it.

You misunderstand. I was saying that Tesla produces cars at a faster rate (as in more cars made per week) than Porsche even plans to, which limits their ability to threaten Tesla.

Audi’s E-tron Quattro looks amazing – no one will buy the Tesla minivan X when they can get an E-tron.

No – building cars under tents in your parking lot never looks good, no matter the context.

First of all Porsche is part of WV group and make some 10 million cars per year. Secondly, production ramp-up issues are normal in the Auto industry but should not be confused with Tesla’s production hell. Production hell is 100% self inflicted by Elon Musk by; (a.) Not listening to industry experience advice and insisting to “build the machine that build the machine” and (b.) being under severe financial pressure to ramp up production to keep the company alive. Elon never have time to do production right but always end up doing it twice. (Model S, Model X and Model 3) Third, Porsche/VW is in no way depending on the success of the Taycan, like Tesla on model 3, and will take the time needed to get things right the first time and not build cars in temporary facilities. Porsche is the core of German Engineering. Fourth, Porsche even being one of the smaller VW brands makes over 200-250K cars per year and is very profitable with an operating margin well above 15% compared to Tesla’s stated 20% gross margin. Having said that I still think Tesla is good for the Automotive industry and is accelerating the move to electric… Read more »

I think Tesla’s big advantage is the supply chain they have already built for batteries. It reminds me of how Tim Cook crushed the competition for years by outmaneuvering the competition by dominating capacity for raw materials and transport logistics. Porsche’s advantage is that they can make a great-driving sportscar, and hopefully one that will cost less than the new Roadster.

Why are they asking the workers for money? Will executives forego their bonuses too?
Isn’t VW a large and extremely rich organization?

You should read the article:
” They’ve even opted to keep their salaries flat until 2026, in order to help finance the factory. This means that no regular salary increases will be seen by Porsche workers over the next few years”

Bonusses are not affected, and Porsche pays good bonusses, even to factory workers. And yes, executives are included in the salary increase freeze.

The original article on Teslarati was silly, and so is this. Why not just say that Porsche is only planning to produce 5% (one twentieth) of the BEV volume in 2020 that Tesla will produce in 2019?

The enthusiasm of the employees to make this car suggests they may know something that the VW Group bosses forget every time the German Government stops kicking them for 5 minutes, that mass market petrol cars will be basically dead by the late 30’s, and even specialist sports cars will be struggling.
As for diesel cars, I believe they have stopped all sales in Europe currently. Let’s hope a temporary halt becomes permanent very soon.

Oh, please. Employees being asked to defer cost-of-living/ seniority raises, and a company converting an existing gasmobile assembly line to assemble its first BEV, isn’t “production hell”.

Production hell is having to put an extra partial production line in a tent in your parking lot because there isn’t enough room in your one-and-only auto assembly plant, and your CEO camping out on the roof of a factory to personally oversee the complete rebuild of a failed automated production line after your company has already announced the start of mass production.

But let’s not blame Porsche for the overly dramatic headline here. It’s great to see that Porsche is finally moving into the 21st Century!

Go Porsche!

Yes suggesting “Production Hell” for the VW group is laughable…

TSLA: -$9/3.09%

Compliments to the graphic artist who ‘created’ the yellow beauty shown. Most assume the real car is the form of the many black test mules……a fairly nondescript 4-door sedan.
But if it’s the ‘yellow’ or the ‘white’ they can continue to keep my deposit.