Subscription plan expands Porsche's reach

DETROIT -- The Porsche Passport subscription plan being piloted in Atlanta is bringing new and younger customers to the Porsche brand at rates beyond expectation.

"They are much younger than our average customer," Porsche Cars North America CEO Klaus Zellmer said Wednesday at the Automotive News World Congress here. And "78 percent of members in Porsche Passport have not owned a Porsche before, currently do not own a Porsche. So the conquest rate is close to 80 percent."

Most of the members have opted for Porsche's top-tier plan, which costs $3,000 per month but gives the customer access to all 22 available models. The other option is $2,000 a month with fewer vehicle choices.

Porsche announced the pilot in October, and the first subscribers, a group of about 50, began to get cars in November.

The Passport plan is one new way to access the Porsche brand, Zellmer said. But there are others.

More than 160,000 people have visited two Porsche Experience Centers since they opened, in Atlanta in 2015 and Los Angeles in 2016.

"Our two brand embassies in Atlanta and L.A. have really put Porsche on the map in the United States and have become vital touch points with customers, enthusiasts and future fans," Zellmer said.

Engaging with those future customers -- and delivering an experience that lives up to the brand -- is key for Porsche as the industry transforms in terms of products and how they are delivered. Porsche is planning a big expansion into electrified powertrains. It already offers plug-in hybrids for three of its nameplates, and it will start selling its first full battery-electric vehicle in 2019 when the production version of its Mission E concept comes out.

Half of all new Porsche sales will be electrified vehicles by 2023, according to a slide Zellmer shared during his presentation.

In addition to the subscription plan potential, Porsche is anticipating changes in the purchase process. By 2025, 30 percent of all Porsche cars will be sold online, the company said in a video Zellmer also shared. But the dealership still will be a key part of the experience -- which is why Porsche is working closely with dealerships on multiple efforts to improve the customer experience in those brick-and-mortar outlets.

"I very much believe in the dealership being the mother ship of our future business model despite the fact that our online business has to be incorporated in there as well," Zellmer said. "We have to find the ideal balance of people starting their purchase journey with us online to them being handed over seamlessly to our sales staff to complete a transaction or complete a service."