Munro Live: Lucid’s Midsize Strategy: Cost Engineering with Cory Steuben

[gaskiller]

Expecting Porsche and Ferrari to be gone in 10 years is a fundamental misunderstanding of the luxury market. Sports cars have been toys to buy for the wealthy to show off for a while now. The exclusivity matters almost more than the performance. That's why the whole Ferrari VIP customer exists, and Porsche is quickly going that way too. Just look at the rising prices of the entire 911 lineup.

Honestly, Lucid is more likely to go bankrupt in that timeframe than either of those two companies.

98% drop in profits for Porsche....they are in BIG trouble.....

Porsche’s $5 Billion Profit Collapse: Inside the Strategic Crisis That Just Rocked One of the Auto Industry’s Most Powerful Brands

For decades Porsche has been one of the most profitable car companies on the planet. That reputation just took a staggering hit. The German performance icon reported operating profit of just €90 million for 2025 — a jaw-dropping collapse from €5.3 billion the previous year. That’s a 98% drop, a...

finance.yahoo.com

Ferrari sales dropped for the first time in 2025, excluding covid year, they never had a drop in sales. The new Generation of car buyers don't care much for super performance cars. I dont see Ferrari sales climbing going forwards.

 

[erigion]

98% drop in profits for Porsche....they are in BIG trouble.....

Porsche’s $5 Billion Profit Collapse: Inside the Strategic Crisis That Just Rocked One of the Auto Industry’s Most Powerful Brands

For decades Porsche has been one of the most profitable car companies on the planet. That reputation just took a staggering hit. The German performance icon reported operating profit of just €90 million for 2025 — a jaw-dropping collapse from €5.3 billion the previous year. That’s a 98% drop, a...

finance.yahoo.com

Ferrari sales dropped for the first time in 2025, excluding covid year, they never had a drop in sales. The new Generation of car buyers don't care much for super performance cars. I dont see Ferrari sales climbing going forwards.

Over $3 billion of Porsche's profit drop was because they wrote off strategic investments, and a majority of those write-offs were EV related costs. This is corporate accounting to reduce their tax burden. Losing so many sales in China obviously hurts but 911 sales are still up 22% YOY even with the price increases and soft Chinese market. Their profit will be back to the billions in 2026 once the write-offs are off their books.

Ferrari delivered 100 fewer cars in 2025 but made over 200 million more Euros compared to 2024, and have outright stated that their order book through 2027 is strong.

Thinking these brands are going to collapse within a decade is just not realistic.

If Lucid can get midsize right, the real pressure is going to be applied to BMW, Audi, Mercedes and other similar brands. Why spend 60-70k on their midsize EV when you can get something very comparable from Rivian or Lucid for 50k?

 

[prgarg]

I think Ferrari has built a business designed to be successful with extremely low sales volume. Porsche's business has been built to sell larger volumes (still not huge, of course). I can imagine that they could struggle to survive if they need to restructure around selling the kind of low volume that Ferrari does. I have no idea how being part of a larger auto group might impact their ability to make that kind of transition.

Also, both brands are part of big automotive conglomerates, not stand alone brands as Lucid is.

 

[erigion]

Also, both brands are part of big automotive conglomerates, not stand alone brands as Lucid is.

Ferrari is no longer part of FCA, and Porsche/VAG has got to be one of the weirdest ownership structures of a multinational corporation.

I think Ferrari has built a business designed to be successful with extremely low sales volume. Porsche's business has been built to sell larger volumes (still not huge, of course). I can imagine that they could struggle to survive if they need to restructure around selling the kind of low volume that Ferrari does. I have no idea how being part of a larger auto group might impact their ability to make that kind of transition.

Oh, yea. Porsche is definitely more vulnerable to a rapid EV transition but as crazy as it sounds, moving the 911 even more upmarket seems to have been the right move.

 

[Need4Sleep]

Ferrari is no longer part of FCA, and Porsche/VAG has got to be one of the weirdest ownership structures of a multinational corporation.


Oh, yea. Porsche is definitely more vulnerable to a rapid EV transition but as crazy as it sounds, moving the 911 even more upmarket seems to have been the right move.

Porsche could end up kind of like how the SUV and crossovers took over. Perhaps in the future they could use EVs as their volume sellers to then fund the more traditional 911 program, maybe even to the point that they could keep variants of the flat six naturally aspirated. I've heard that Porsche bought a Hyundai Ioniq 6N for their own analysis and benchmarking so I think we could be in for a surprise what they could do with EVs once they get their long-term strategy sorted.

 

[Need4Sleep]

If Lucid can get midsize right, the real pressure is going to be applied to BMW, Audi, Mercedes and other similar brands. Why spend 60-70k on their midsize EV when you can get something very comparable from Rivian or Lucid for 50k?

Exactly, I think that if Lucid nails their targets, it's those level of brands that could be in danger. I'd love to see a head-to-head between the i3M and a (hopefully) Cosmos Sapphire

 

[illopp00]

Nothing says a Sapphire Gravity needs 4 wheel steering. That said I doubt one is in the works, they have thing they need to focus on.

Right the Air Sapphire exists because Tesla made a plaid, and porsche made a taycan GT. Both of those are on the chopping block. And there isn't anything on the market that even touches the Gravity DE on the road yet other than maybe a new Cayenne EV. Xiaomi may bring a crazy YU7 to Europe in a couple years.

 

[illopp00]

I don't think it'll be in a decade, but I think it is possible that ICE vehicles (to an extension, fossil fuels as a whole) could eventually still have a place in novelty (e.g. Bugatti Tourbillion, Singer DLS) or outlier cases where electrification has yet to be viable.

Could this happen in a decade? I'm not quite sure.

All I can say is, until then, I will remain on my knees for Lucid to make a tri-motor Cosmos Sapphire

They will be like Horse Racing and owning a horse.... But I still do have a decently long list of early 90s to mid-2000s Ferrari's on my bucket shopping list

 

[illopp00]

98% drop in profits for Porsche....they are in BIG trouble.....

Porsche’s $5 Billion Profit Collapse: Inside the Strategic Crisis That Just Rocked One of the Auto Industry’s Most Powerful Brands

For decades Porsche has been one of the most profitable car companies on the planet. That reputation just took a staggering hit. The German performance icon reported operating profit of just €90 million for 2025 — a jaw-dropping collapse from €5.3 billion the previous year. That’s a 98% drop, a...

finance.yahoo.com

Ferrari sales dropped for the first time in 2025, excluding covid year, they never had a drop in sales. The new Generation of car buyers don't care much for super performance cars. I dont see Ferrari sales climbing going forwards.

Yes the demographics and wealth inequality effect don't favor much growth in those areas....

 

[erigion]

Porsche could end up kind of like how the SUV and crossovers took over. Perhaps in the future they could use EVs as their volume sellers to then fund the more traditional 911 program, maybe even to the point that they could keep variants of the flat six naturally aspirated. I've heard that Porsche bought a Hyundai Ioniq 6N for their own analysis and benchmarking so I think we could be in for a surprise what they could do with EVs once they get their long-term strategy sorted.

That's exactly what they're doing with the ICE Macan and Cayenne. Those were, and still are, the brands bestselling vehicles.

One of the biggest problems they had with moving the Macan from ICE to EV was that they were saddled with CARAID. The absolutely shitshow of their software development subsidiary (CARAID) forced them to delay the Macan EV (and Audi Q6/A6) release by about a year. Porsche and Audi could have been selling their 800v EVs for almost 2 years now instead of just one. Not to mention, their 800v architecture looks pretty uncompetitive with the SUVs coming from BMW, Volvo, and MB. Audi is even skipping the 2026 Q6 to give the car a more robust update for 2027.

Not to mention, VAG is paying billions to Rivian for their software, who they learned a couple of months ago has zero interest in developing software for ICE vehicles.

 

[HC_79]

Not to mention, VAG is paying billions to Rivian for their software, who they learned a couple of months ago has zero interest in developing software for ICE vehicles.

I don’t see how VWAG is going to fundamentally fix the software problem by slapping Rivian software on top. Unless Rivian is supplying the hardware stack they’re going to run into the same issues Cariad faced.

It’s a vertical integration problem. VWAG has many external partners and they openly admitted the entertainment stack had something like 70 vendors all providing different bits and pieces. Problem was, when one thing got updated it broke another. Therefore, they needed to test every single suppliers hardware every time one updated something. So, you start testing, get 20 vendors in and hit an error. Work with that vendor to fix and back to square one you go to test all again. Never ending cycle because they don’t have full control of the entire stack.

 

[erigion]

I don’t see how VWAG is going to fundamentally fix the software problem by slapping Rivian software on top. Unless Rivian is supplying the hardware stack they’re going to run into the same issues Cariad faced.

It does sound like Rivian is licensing some kind of computer hardware to VW.

The Latest Inside Rivian’s $6 Billion Deal to Rewire Volkswagen’s Future

An update on the VW-Rivian Joint Venture on its first anniversary.

www.motortrend.com

What I don't understand is all this talk about moving VAG to a zonal architecture system. One of the major talking points for the PPE platform (what the Q6/A6 and Macan EV are based on) when it was first revealed is that it runs on just 5 CPUs that are supposed to handle everything in the car, and are OTA updateable. They had a zonal architecture before Rivian did! But the Q6 was buggy as hell on release and it doesn't sound like 2025 vehicles are getting the software updates coming to the 2027. Sucks to be an early adopter, as usual.

 

[babylou66]

That's exactly what they're doing with the ICE Macan and Cayenne. Those were, and still are, the brands bestselling vehicles.

Not to mention, their 800v architecture looks pretty uncompetitive with the SUVs coming from BMW, Volvo, and MB. Audi is even skipping the 2026 Q6 to give the car a more robust update for 2027.

Macan EV vs Macan ICE sales split is 55/45.

How is the Porsche 800V architecture uncompetitive versus the others? The Cayenne EV charges 10-80% in 15:15. The charge speed has been independently verified and the 70 mph highway range has been tested to hit ~350 miles. Seems very impressive to me. The BMW iX3 has indpenedently tested below it's spec of 21 min charge speed. I haven't seen independent tests for the new Volvo EX60 (claimed 19 min for the big battery) or new MB GLC (claimed 22-28 min).

 

[gaskiller]

Over $3 billion of Porsche's profit drop was because they wrote off strategic investments, and a majority of those write-offs were EV related costs. This is corporate accounting to reduce their tax burden. Losing so many sales in China obviously hurts but 911 sales are still up 22% YOY even with the price increases and soft Chinese market. Their profit will be back to the billions in 2026 once the write-offs are off their books.

Ferrari delivered 100 fewer cars in 2025 but made over 200 million more Euros compared to 2024, and have outright stated that their order book through 2027 is strong.

Thinking these brands are going to collapse within a decade is just not realistic.

If Lucid can get midsize right, the real pressure is going to be applied to BMW, Audi, Mercedes and other similar brands. Why spend 60-70k on their midsize EV when you can get something very comparable from Rivian or Lucid for 50k?

It shows they are struggling to figure out how to transition to EVs……a body with 2 heads can never be good at making decisions…..EV or ICE…..

Their profit crashed because if lost Chinese sales. They are never getting those back.