McLaren Automotive has already done the impossible. Not even nine years old, the upstart British automaker is consistently profitable with steadily growing sales and a range of sports and supercars that make gear heads go googly-eyed. Creating a profitable car company is not easy; just ask Elon Musk.
“If you look at our competitors, Ferrari has been in existence for 75 years, Lamborghini almost 75 years, starting with tractors. Porsche is what, 70 years old? We’re nine this year,” says Paul Buddin, chief financial officer of McLaren Group, parent company of McLaren Automotive.
The company’s rise was incredibly rapid. “You remember Doogie Howser MD? It’s a bit like him. It’s like going from junior school to being a doctor in five years — it’s that sort of achievement,” says Buddin.
Supercars, however, are like sharks; if they stay still, they die. McLaren cannot rest. Now that the company is established, what’s next?
The recently announced Track 25 business plan lays out the broad strokes. By 2025, McLaren plans to launch 18 new models or derivatives, investing GBP$1.2 billion in the process. All of its new cars, with the possible exception of the top-of-the-line Ultimate Series, will feature some sort hybrid powertrain. Unlike its rivals, McLaren has promised not to build an SUV.
“One of the risks with a startup car company is that you launch and then have no more new ideas,” says Ian Digman, McLaren’s head of product management. “What McLaren did with Track 25 is say ‘yes, we are investing, we are here for the long-term, we are putting out more and more models.’ So, for you as a customer or you as a retailer, (McLaren) is a safe investment.”
McLaren sold 4,806 cars last year, up 44 per cent from 2017. North America is the biggest market, with over a third of total sales. Canada accounted for 202 of those, five of which were the $1 million Senna supercar. By 2025, the company aims to sell 6,000 cars globally, slightly less than its Italian rivals.
Among the 18 new vehicles will be a successor to the P1 hybrid hypercar, a three-seater called the Speedtail with a top speed of 402 km/h, and the 600LT Spider and 720S Spider. Expect to see a track-focused LT version of the 720 in late 2020.
Lightness, not horsepower, will be the battleground on which next-generations supercars will fight, the company claims.
“Horsepower is going to get to an asymptote,” says Ian Digman. In other words, cars can’t get much quicker, but they can become lighter, more efficient and ultimately more fun to drive.
For gear heads who don’t have a racetrack in their backyard, this is a long-overdue shift. On public roads, you can’t get close to the limits of any modern supercar without putting your life and licence in danger. Making cars lighter drastically improves ride, handling and responsiveness, not to mention energy efficiency.
Its carbon-fibre expertise means it is well poised for that future. McLaren’s Formula One racing division has been making cars out of the stuff since the 1981 MP4/1.
The company holds patents on a faster, more cost-effective carbon-fibre manufacturing process, Buddin explains. That was the key to the company’s early success.
Every McLaren — from the $200,000 570S to the $2 million P1 GTR — is built around a variant of the same carbon tub and twin-turbo V8 engine. It makes for a rather homogeneous product lineup, on paper at least, but it’s why McLaren can sell the 570S for the same price Porsche sells its aluminum-chassis 911 Turbo.
As a young company, McLaren still faces significant challenges. In its first few years, it churned out new models very quickly and residual values suffered.
“Going back to the early days, yes, those cars had poor residual values,” says Buddin. “But again, as we’ve grown and established and stabilized the business, our residual values have got much better.”
For example, you can get a new 540C from McLaren Toronto with a 1.99 per cent lease rate on a two-year term. Some models, like the limited-edition 675LT, have even started appreciating in value.
The bigger issue, however, is that McLaren is simply not a household name. It’s why Buddin wants to get more McLaren posters onto the walls of more kids’ rooms. It’s why McLaren is pushing to make its dealerships welcoming and approachable places. And it’s why McLaren will have a bigger presence at auto shows this year.
“Even if you can’t afford to buy the car, we’ll still treat you the same as someone who can, because one day you might be able to afford it,” Buddin says. “Children with posters on walls is all part of creating a brand. Those children are the future.”
Although very few people will ever put a McLaren in their garage, supercars ensure there will be a next-generation of enthusiasts and gearheads. As mainstream cars are in danger of becoming dull, self-driving toasters-on-wheels, supercars remind us driving can be an adrenaline-pumping, eye-opening thrill; that it can be entertainment, not merely a chore.