VW Group lost how much money on each Veyron?!
Not everyone is aware that the Volkswagen Group lost a reported $6.25 million on every Bugatti Veyron sold. How was this possible considering each Veyron cost almost $2 million? The development and building costs were insanely high. Why did McLaren end F1 production in 1999 when 106 were built despite a planned run of 250 units? Same reason. Things are different now. Automotive News Europe has an interesting report about today's hypercar market and how rapidly it's tilted in favor of automakers making a profit.
But first things first: brands such as McLaren are having no difficulty selling limited run hypercars, such as the upcoming three-seat BP23, which is already sold out. It too will only have a 106 model production run as an homage to the F1. "To think at 2 million pounds (2.3 million euros) it's not the most expensive supercar out there is staggering in itself," said McLaren CEO Mike Flewitt. And yes, the BP23 will be profitable for McLaren. But unlike during the F1's era, McLaren also has a range of less expensive cars to help bolster profits. For example, McLaren plans to sell between 5,000 and 6,000 examples of the 720s, "the most important car to us in our range from a financial perspective," Flewitt added.
Also in the past, exclusive hypercars mainly came from Ferrari, but now there's competition from Aston Martin and Mercedes-AMG with the Valkyrie and Project One, respectively. For its part, Bugatti has since learned from the mistakes made with the Veyron. Today's Chiron with ts updated construction methods, begins at around 2.4 million euros with a planned seven or eight-year production run of 500 units. Bugatti already said the Chiron won't lose money. Let's also not forget about the rise of niche hypercar companies, specifically Koenigsegg and Pagani. Both have fully established themselves in this ultra-exclusive club since the Veyron first went on sale in 2005.
The greater selection of hypercars to buy is a direct result of expanding wealth in countries other than the US or UK, specifically China, Russia and, of course the Middle East. Hypercars are also proving to be excellent investments. The McLaren P1, for example, has doubled in value since it launched in 2014. Aston Martin is certain the Valkyrie also won't depreciate. Try to find a LaFerrari for less than $3 million (original price: around $1.5 million). You won't. The combination of improved building methods, a decrease in material costs, and a more geographically diverse (and growing) population of high-net-worth individuals with at least $5 million in liquidity, makes the hypercar market stronger and more profitable than ever, with no signs of it slowing down.