AS LONG AGO AS THE EARLY ‘70s, Ferry Porsche wanted an “off-road car of the Range Rover type.” The board of the time resisted and nothing more happened. By the early to mid-‘90s, Porsche was experiencing difficulties. Only 14,362 vehicles were sold in 1992 to 1993 and, with the introduction of the Boxster, sales including the 911 increased nicely, but to still only 32,000 in 1996. Porsche investigated various market segments in the mid-‘90s and its internal research revealed extraordinarily little competition in high-performance upper-end SUVs.
Porsche looked at a collaboration with Mercedes during 1996 and negotiations were almost complete when Mercedes suggested a small shareholding in Porsche. Wendelin Wiedeking, CEO at the time, immediately ended negotiations and started looking for a new collaborator. Porsche joined with Volkswagen on a project called Colorado. The SUV was announced in 1998 without a final name.
Porsche invested $600 million, which would have been more without partnering with VW. Porsche built a new factory in Leipzig, and the Cayenne was presented to the world in 1998 at the Paris Motor Show. Porsche had worked hard to retain the Porsche look and, of course, performance. The Cayenne finally went on sale in 2002.
Upon the Cayenne’s release, journalists — who had questioned the idea of Porsche building an SUV in the first place — were generally impressed once they had driven the vehicle. Despite continued criticism about Porsche venturing into the SUV market, segment sales of the Cayenne and later the Macan proved naysayers wrong. It took only three years leading into 2005, for more Cayennes than Boxsters and 911s combined to be built. The one-millionth Cayenne was built in late 2020, just 18 years after it first went on sale.
You could say that Porsche is an SUV company that builds sports cars — or a sports-car company that finances itself with SUV sales. Either description is true, and Porsche is currently the most profitable per-unit automobile company. </>