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I don't think it is black..but it IS different from the historical experience (and other countries) and it will change Morgan buying patterns. My concern is that so many comments here (such as Aeroman's) suggest that it is a trend that it is getting worse.

Excellent point! Thank you. The new owners may be unaware of the previous Morgan residual resiliency and have no problem with the present quick loss in value because that is how they were trained with other cars. I can understand that.

However, what causes weakening residuals? Is it these new buyers..as their attitudes are assimilated into the community? If that is the case, would it mostly affect the models they prefer?

I think that the trend started earlier, in the 90s, and the reasons are more basic. Will this trend stop where it has appeared or continue and spread elsewhere?

Lorne

Lorne,

One reason in GB was that (some) dealers sold new Aero 8s with heavy discounts. When I was in Malvern in February 2003 a Morgan agent, located not far from Malvern, offered an unregistered Aero 8 (285 miles) for less than 46,000 GBP in a Sunday paper. I don't remember what the list price was in 2003 (59,000 GBP????).

Roderich

Rod, would this have been an ex-demo car? I am aware that some of the demo cars have been sold off below market value and this practice had caused some concern among owners. I believe this has now stopped as recent cars have been advertised at fair market rates.

Lorne - in my view there is no magic to this.

In the past in the UK (main mog market I guess) there has been higher demand than supply.

Mogs don't get retired to a scrappy after 5 years like most Euroboxes do, so the numbers available in the UK are constantly rising.

similarly (I would guess) that the available group of potential purchasers keeps falling, a function of age, demographics, and viable alternatives.

Perhaps the US will buck this trend - if theres enough enthusiasm for the marque and a low enough supply values will stay high for the moment.

I don't know, Simon. I only know the two facts I mentioned (285 miles, unregistered). As the dealer is located close to Malvern it was not the delivery mileage.

I don't know whether this was supposed to be just a funny post, at least the remark on what happens in GB to Euroboxes after five years made me insecure.

There are/were two reasons Morgans were restored in UK:

1. Many cars are like family members.
2. Financially it made sense.

Look what happened with Jaguar E-types. When prices rocketed much money was invested in cars nobody had touched before because it didn't make sense to invest money.

Owners are not a factor. The Aero dealers have had problems selling their demonstrators and this has been presented to the Factory.

In response, the Factory has recently proposed that it shall cancel the Dealer Demo Program (aka demonstrator discounts).

Lorne

Agreed. That is the basics..the domino effect from that is even more fascinating.


Yes. But they are rising almost everywhere...so that is not a fact to differentiate on.


Actually, aside from the last on alternatives (which has been a factor on occasion), the opposite is true. The largest wealthiest generation in history "the baby boomers" fit the Morgan demographic to a tee and are cash heavy and pension flush. Best luxury item demographic for the foreseeable future.


Certainly any part of the world where Morgan supply is limited for any reason has VERY high residuals, Denmark, Canada, New Zealand, Australia, the US....

For that matter, the choicest Morgans in history, Plus 4 SS or DHCs that were mostly shipped to North America originally, are being bought up by Europeans for enormous prices and shipped back now. So let's agree and refine your point.

Residuals, of any model, are a function of the degree of unsatisfied demand.

Lorne

Rod - 5 years is obviosuly an exaggeration. Some itallian cars in the past (lancia beta! Astra etc) made it to the scrappy well before that five year time frame. Many company cars are tired and ready for scrappy / taxi after 5 eyars at 40k+ a year. Many more in general usage will run for 10-15 years.

I guess my point was - as you make so clear, that a morgan isn't an average eurobox - it is special, and therefore they do not get 'retired' / broken for spares unless they meet a tragic end in a hedge somewhere and really are unviable.

My key point is that, the stock of morgans does not reduce - therefore the available pool to buy from is ever increasing. (nothing to do with other cars) Purely that the pool of morgans you can buy is constantly increasing, andd becuase of enthsuasts like us it grows year on year as less 'die' than are born I should imagine.

As an ever increasing resource, it's hardly suprising that values do not stay static, but fall.

As the number of enthsiasts buying morgans seems to be smaller than it was (in relation to the availability if not in absolute numbers) the price of the commodity will fall...

Just market forces - nothing sinister!

So in the past when Morgan leadtimes for new models were the legendary 'years' then residuals were high. If you could not get an new one you purchased old or restored (old Morgans never die they just get rebuilt).

Nowadays lead times are much less and hence secondhand models depreciate.

Logical

BUT dealers were screaming this year that there were no used cars on the market. As Simon will testify this applies to good Mk1 Aero's as well.

So why are residuals still heading south??



So what are you thinking of?? Give us a clue then...

I think Rich is right it is just supply and demand but I think the supply and the demand dynamics have both changed