McLaren Automotive, the street arm of the British Formula One racing team, has sped into the black, making a profit after only its third year of supercar production.
More dealers around the world and sales of its US$1 million-plus P1 model helped the Woking- based firm to post a pre-tax profit of £4.5 million (Dh27.6m) and an operating profit of £12.4m for last year.
Last year’s turnover was up to £285.4m from £266.6m a year earlier as it delivered 1,359 12Cs and 36 P1s.
It opened 13 new showrooms in the period, including four in China, and plans to add another 20 retailers this year as it expands its global network to more than 100 locations by 2018.
Investment in future models was up slightly to £70.6m. McLaren currently markets five models priced between Dh1m and Dh4.5m and is looking to increase its visibility and volumes with a more affordable version next year codenamed P13.
“We hit a profit in 2013 which was ahead of the time the equity partners and the board thought we would,” said Ian Gorsuch, the regional director for Middle East and Africa, McLaren Automotive. “We have taken three-and-a-half years to set up a global car company, and to get into profit in three short years is pretty good.
“In a year or two we will be producing 4,500 cars a year against Ferrari’s 7,500. We will also be releasing a less expensive model soon to give us more volume. In two years’ time you will be seeing far more McLarens on the road, but they will still be something to look and point at.”
In February, Ferrari said it had increased profits for last year by lowering the number of cars sold to boost exclusivity. Deliveries fell 5.4 per cent as net profit grew by the same margin as it clocked more than €2 billion (Dh9.97bn) in revenues.
Mclaren regards the Middle East, including the UAE, as a principal target for sales.
“Our biggest market in the world by volume is the USA, which doesn’t really understand Formula One,” said Mr Gorsuch. “This region accounts for just over 10 per cent of sales. However, buyers from this region are fairly cosmopolitan and will often have houses in Geneva, London or Beverly Hills and they will buy the cars for other locations worldwide. We punch above our 10 per cent weight. The UAE is responsible for half of the sales, accounting for about 70 cars last year. Customers here also like a bespoke offering, therefore the value of the car is higher.”
McLaren’s latest offering, the Dh1.4m 650S will be on the UAE’s roads from July and is currently sold out – the company says it has received more than 1,000 orders worldwide.
The car maker has recently started offering dedicated financing options in its UAE showroom to help boost sales.
“In the last three four months we have offered finance and probably 20 per cent of our customers have used the option,” said Mr Gorsuch. “We are seeing a resurgence in the Dubai economy and property. A lot of our customers are canny investors and want their money to work for them.
“If they feel they can invest the Dh1m in something with a return and do a good finance deal on their car that makes sense. You get a good return on the property investment and a beautiful car. We just wanted to make sure we covered all bases and offered a choice.”
ascott@thenational.ae
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