Publicly Traded or Privately Held Automotive Marques

[skip0110]

So, the question of the day is, does publicly trading a automtive manufacturer detract from the quality of it's cars?

I think that privately held companies can maintain a better focus on engieering and design than those that must worry about sales figures and revenue on a timetable that is dicated by Wall Street, rather than the engineers. Take, for example, Porsche. For many years (under the guidance of Ferdinand Porsche) the comapny remained privately held, and developed cars that maintained a strong character and a strong common guiding principle which brought them a very loyal fan base, although not stunning sales numers. Today, Porsche is traded publicly, and the 911s are far more bland than those of yesteryear. We even have a Porsche SUV. In my eyes, Porsche is selling cars on the image it build when it was independently held.

On the flip side, however, a publicly traded maruqe has more cash, which allows tham to aggressively persue engineering research.

 

[Pupik]

Whoever owns the rights to the company can do as they please. If you own the company, and nobody else as a part of it, than all you can do is sell you product and profit from that. Maybe you can work out a deal with someone for venture capital, and work out who gets what. But if you sell stock, and it's valued well, sudennly the value of your company is worth more, because you have people investing a future in your company. On the other hand, the onus is on you to make the compnay more valuable than it was beforehand, so people can profit from your business.

I suppose a small company has it easier when making a product that appeals to a select market of consumers; a larger, publicly-funded company had a lot more at stake, and thus only a few monoliths of the industry can afford to make a specialist car on top of their existing line.

Ford (re-?)made the GT, but Ford can afford the shot in the arm, with relatively nothing to gain from its sales....the Focus and F150 will carry the profits anyhow. Mitsubishi, with all it's losses right now, couldn't right now; even slapping some rims and some stripes on their Evo is about all they could do to attract new buyers. Mistu can't afford to eat the added expense of a whole new loss-leader car like Ford's GT.

However, the public gets what the public wants. If you owned a lot of stock in Car Company, then you'd probably get annoyed if they were loosing money with no gains in their respective Racing Series and Car Company's sports car didn't make the brand much profit, you'd vote to axe the racing program or the sports-car line. If specialty sports-cars are what the masses demand, then that's what they'd get. Instead, they want SUVs, easy-to-drive plushmobiles, and hybrid cars. That's 90% of the market, even if that's only 10% of GTPlanet.

 

[cardude2004]

I don't think because it is public the car quality is worse necessarily. I think it just depends on the company and how much they are willing to invest in new cars, materials, and research. I think that American car are very cheap and of bad quality and Japanese cars are the best.