so they modernised the factory and sold the land to developers to realise some more funds, but I guess there will a [quote=kin]clause in the contract that they might have the option to buy back the in 15-20yrs time?
No.
In business parlance here this type of transaction is referred to as a sale-lease-back, the very ultimate form of financing. You sell your asset base and lease it back at a very high return for the buyer. Often, a large part of the sold value is withheld until the premises are vacated...as an incentive for the seller to leave. I imagine that Management at that time did not plan to stay there any length of time.
That is what people said about the Aeromax when it was presented too. As well, right now 4-seater trads cost as much as the Aeros did in 2004 and they have a 2.5 year waiting list. Additionally, in the UK, where all the competition's car prices fell for years, Morgan's kept rising with no effect on sales.
I guess there might be a number of speculators who bought the Aeromax for investment knowing only 100 or 120? to be made. But it did took them awhile to have them all sold tho
Correct. It took 9 months to get to the 100 mark. Annualized, that works out to about double the regular Aero annual sales. This suggests that if you publicly indicate that production will be restricted (and STICK TO IT), you can add 80% to the unit price and sell more units at a far higher profit. That is called good marketing.
As to speculators, the length of time to garner the Aeromax orders and the size of the Aeromax deposit (25,000 GBP) precludes them. For that matter, a speculator's money is a good as anyone else's. We should not be prejudiced.
As for 4seater trads costing as much as 04 Aeros, you must be comparing top of the range V6 4seater with every conceivable extras on it, I don't think the basic 4seater cost anywhere as much...
EVERYONE buys their trads with extras.
I don't think a "basic version" has EVER been sold. In the old days, wheels were an extra! It is a long-held Morgan tradition to have low base prices and let it build up with the order. Aeros come more complete. Try the BHM site calculator for trad pricing.
Also I was at the factory a few weeks ago, and spoke to one of the staffs at MMC, think he only mentioned a year waiting list on 4seater and slightly less for +4...
Really? How high up? My information comes from the higher-ups and, as I have noted before, current information can depend on who informs you. Mine can be bad and yours good. I can recheck with other sources if you'd like.
I don't agree. The goal of marketing is to make more profits.
I agree, but are you implying that MMC selling their cars with no profit
Yes. I thought that was clear..only kindly put. The MMC has made no secret that its losses since 2002 have been enormous. (I believe they will eke out a profit for 2007, but they are certainly not satisfied with its size considering the big increase in units sold.)
... the FACT is that the company is presently planning to produce many more cars. Take that as a given, at least on intention.
Well ...in that case, then its even more of the reason to market its product to attract more buyers, rather than having its cars sitting in a compound unsold.
That won't happen. With the new allocation system, UK dealers must order their whole year's cars by the first of the year and secure their purchase in advance. The system has proven to be very hard on the network and residuals but the company is hopefully protected against excess cars sitting in their own compound.
Up to 2 years ago, I regularly buy mags to keep myself updated, but never heard anything of Morgan, so I'm wondering what have they been doing during the last few years?
When exactly? Until 2002 they made phenomenal profits with the same output they had since the 1930s and built up a legendary capital base. Since then it's largely gone. We're trying to figure a way to reverse that.
Despite immense Factory pressure, the dealers still complain they have a hard time selling those they have.
The factory might give dealers special incentive to sell Aeros,
Not happening. Quite the contrary, as I mentioned earlier the MMC have indicated they are going to cancel the Dealer Demonstrator incentive. Commissions have been decreased across the board over the last few years.
but if no one is marketing Aero, it might as well be a picture on the wall, like if someone were selling Rolex watches for half price, but joe public does not get to know about it, those watches would still be worthless...
Yet, as you said above, for years you regularly read magazines and never saw anything about Morgans. Yet Morgan was making seven figure profits those same years.
Lorne, its fair to say that we have different marketing strategy and approach, both of us could only speculate,
Of course.
Lorne
