, Columnist
The Real Winner of the Used Car Bubble Is Revealed
Windfall profits from car financing are padding automakers’ bottom lines.
A bubble.
Photographer: Justin Sullivan/Getty Images North AmericaThis article is for subscribers only.
When Porsche tried in 2008 to take over (much larger) Volkswagen AG using opaque financial derivatives, analysts pejoratively dubbed it a “hedge fund” that also makes sports cars. The bid was unsuccessful.
Now Porsche is part of Volkswagen, and the parent could almost be described as a “credit giant” with some car brands attached. This structure, though, is doing wonders for the German manufacturer’s bottom line.