Volkswagen is offloading the high-end Bugatti brand to its subsidiary Porsche, which will own 45% of the company, and electric luxury carmaker Rimac, which will own 55%.
Bugatti, founded in 1909, ceased selling cars in the 1950s but was revived in 1987 and bought by VW in 1998. Juventus star Cristiano Ronaldo is a known enthusiast of Bugatti, which sells certain models for over $10 million.
While Bugatti’s storied racing history is contained in the first half of the 20th century, Porsche competes in the GT series and the all-electric Formula E series, among others. In December, VW slimmed down its racing involvement to a small set of electric races.
Porsche, which is considering an IPO to fund its move into electric models, plans to leverage the technological innovations that could come out of the partnership.
- Rimac, founded in 2009, sells electric powertrain and battery technology, as well as unique vehicles like the Rimac Nevera, which sells for $2.4 million.
- Earlier this year, Porsche raised its stake in Rimac to 24% at a valuation of $939.4 million.
- Bugatti, whose signature Chiron model starts at $3 million, has generally lost money. Porsche sells many models at five-figure prices and has been consistently profitable.
Volkswagen reported total sales of $263.5 billion in fiscal 2020, an 11% year-over-year decrease, which the company attributed to the COVID-19 pandemic.
