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Lorne any view on this point?

As for your mention of type-centric Morgan owners, I would say that type of behaviour is not vastly different (although with another bias) to what I was describing to you.

Another very important aspect of what we are discussing is return on invenstment. I wonder how much time has been given to the study of if there is any trend in new sales post an article being written on one of the Morgan cars.

For instance, Classic & Sports Car magazine did a feature on the Plus 4 throught the years about 24-months ago. Was there any up-swing in sales post this?

EVO featured the Aero 8 4.4 this summer (what we had of it ), did the month after show a different trend to other months (or the same month the year before, etc)?

Simon, as someone who has previously expressed opinions in that vein, let me clarify my views. I am one of the ones who believe that excessive visibility is always a good thing. There is a reason I don't drive a Porsche or an Aston. Apart from loving my Morgan for what it is, I also love the fact that most people are friendly and curious when they see one. Isn't there a risk that that will change if the media is flooded with images of footballers and rappers driving them?

I am also very happy about every new Morgan owner, as I want as many people as possible to get to experience the wonderful feeling of driving one - but at the same time, I do recognize that they are not for everyone. The classic Morgans are *not* modern cars. Anyone buying one thinking it is just a boxter in a nice-loooking shell will be very, very disappointed.

I see this with land rovers. Many people buy Defenders for the image, and get very disappointed when they discover that they are still rather agricultural, and not baby Range Rovers, or cooler looking BMW X5:s.

But, OK, who am I to argue this - I am just an old fart who owns (amd maintains!) a Bristol, several old landies beside the 4/4. Not only that, but I even own and occasionally use a flat cap!

I see. You believe these losses for such a long period may suggest that profits were not a priority in the short or medium term to some company stakeholder. I think you have a good point. The ongoing losses and huge capital depletion could easily be explained by the existence of a stakeholder(s) with a priority other than the company's financial well-being and security.

I note that the Freeman Stakeholder theory also lists employees, suppliers and customers as stakeholders. Interesting.

Lorne

Julf, with respect, I NEVER even thought of you when I mentioned that 'type' of person. And I agree with all the points you have made - "friendly and curious people", etc.

However, to question one point you make - footballers and rappers driving Morgans. You've mentioned this twice now and I have to say that I think your fears are pretty unwarranted!

I cannot imagine Wayne Rooney (who favours the Bentley Conti GT Cab) driving a Morgan any more than I can imagine Snoop Dog, ICE T or... (actually, that is about my limit of their names! )

...Morgans just aren't ostentatious enough for the 'genre' of person you mention. They lack the bling-appeal; so, imho, you can relax!

(which, inversely, is the reason most of us love them!)

That is a considerable twisting of what I meant.

All I was trying to do was to say that the things that influence how a company works are not totally dominated by just short term profit. I was not trying to imply that any one stakeholder dominated to the point where the whole companies well being and security comes into question. What I said was

Moving on


So be explicit who are you meaning?

Simon,



Well, when flyfisher mentioned that MMC had turned down the idea of loaning an Aero 8 to Beckham, I think kin responded "Whoever decided against the idea is an idiot!!"
So not that far-fetched...



Agree. It would be a dark day indeed that would see a Morgan displayed at the Moscow Millionaire Fair. Was that to happen, I guess I would (part)trade in my Mog for a Bristol Speedster.

I am no expert and I am unaware of any studies. From this perch, I have seen little or negligible effect from good articles and (hopefully) the same lack of effect from bad ones (though the latter is obviously impossible to detect. Save possibly in 2000/2001 [ugh!]))

On magazine advertising, I do have copes of the ads that Morgan has placed over the years, either to advertise the product or massage their image. Frankly, MMC advertising has never been extensive enough to make a mark or change an image. The MMC has never been able to afford an advertising budget that would make a difference. MMC ads are more whimsical than real but for the same reason, the ads over the years are great fun to look at. They say much more about the era they were created and the people in charge than any sales effect. I enjoy the photo ads featuring the then young Lady Colwyn (Peter Morgan's daughter) entering a +4+ or Matthew Parkin dashing up a hill in a Roadster.

For decades, it has been Auto Shows that can garner sales or inquiries and they are the traditional MMC selling venue, still used religiously today. (i.e. Geneva) However, the results are never certain and "show" orders are not always solid.

However, though Morgan is a very small company, it has, for me at least, a profile far higher than its size. As well, the last few years have seen the selling abilities of existing owners massively supplemented by the internet and the buying of the retiring baby boomers. In my opinion (and a glance at the figures), all this is more than sufficient to keep sales buoyant and even rising IF the MMC makes the products wanted. That is what happened in 2006.

As an aside, Auto Shows can produce some lovely anecdotes. Peter Morgan had quite a few! Here is one of those he wrote me.

It was in the early sixties (a very hard time for the firm);

"I was alone at the Motor Show in Earl's Court, London. A young man came to the stand. I was rather tired in the late afternoon and he started to telling me that they (Morgan) 'are going to change the engine, modify the rear suspension, redo the brakes and generally go over the whole car. He said he knew it to be true because "Peter Morgan told me". I, being tired, did not disappoint the fellow by informing him who I was. He walked off with a broad smile.

Peter Morgan"

Lorne

Phil, 5-6 years is not short term. It is not even medium term for a small manufacturing company. A micro-economist or business analyst would refer to that length of time as long term for such a company. That changes your statement considerably...at least for me.

I do not believe that Freeman means to suggest that large losses can be healthily entertained for many years under any circumstances..even to serve specific stakeholder interests.



I wasn't meaning anyone or anything in particular yet, though I am cogitating on it now. It was your stakeholder theory that put the thought into my head as an arena for possible answers.

I am admittedly heavily trained to think in terms of profits, cash flows and capital preservation and naturally attribute the same motivation to all business endeavors. However, on reflection I must admit that is not always true. For example, TalkMorgan or GoMoG have a non-profit motivation with their "stakeholders".

Perhaps the same is true of the MMC for other reasons. That would explain a lot.

Lorne

Nick, I left this because I hoped SteveD would come along and answer this question from a far better informed position than I! I am sure he will look in on this thread soon but in the interim, here is my very basic understanding.

Car magazine reviews fall into 3 categories: -

Launch
General Content/Editorial
and lastly, and more recently, Running Reports

To break them down -

Launch - the magazines are not "paid" to review the new car; however, there is a fair amount of 'payola' used to grease the wheels. I believe it is kindly referred to as "corporate entertaining", aka putting the journalists up in a nice hotel, in an (often) warm country and wining and dining them for a few days. So while no money exchanges hands, the basic idea is: treat them well at your cost and hope this will entice them into writing nice things about your car.

General Content/Editorial - this seems to fall into the symbiotic relationship side of motor magazines and car companies. Car company provides a car at no cost for a short period of time (2-days to a few weeks), the journalists review the car (often comparing it to a rival) in the hope that it will provide the sort of content that entices the target audience to buy the magazine. The basic formula would seem to be: Car maker needs people to be aware of their product and journalist needs editorial to fill the pages of the magazine to entice buyers of the publication - symbiotic and I believe free from any real 'corporate hospitality'.

Running Reports - the individual journalist (freelancer) or the magazine itself, work out a deal with a car maker to run their car for 12-months or so. Either the car is provided for free (and returned after the stated period of time) in return for publicity or the car is purchased at a significant discount (by the freelancing journalist) for the same reason.

There are other variants of the themes; however, my understanding was that no money exchanges hands but there are 'perks'.

...I'll now wait for SteveD to correct me!

Journalists and the magazines get paid nothing for featuring cars, however there are a few magazines run by the big publishing brands (Haymarket, Emap) who tied advertising deals to content appearances (i.e. sign up to a dozen half-page ads in the year and we will agree to do a feature that shines the attention on your brand). But those are few and far between because the advertising and editorial departments reside in different locations (and as far as the editorial team are concerned, reside on a different planet!).

Every manufacturer sets aside press and promotional cars, and these are provided for launch, comparison tests, feature articles, road tests and running reports. The journalists drive them, sometimes break them and the manufacturer pays for it (except for fuel and some consumables).

In my experience some of these press cars are (surprisingly) quite poorly prepared. I was driving a TVR Tuscan a few years ago that had been provided for a group test (with Porsches and BMWs no less) and yet had visible glue around the trim and several bits were broken when delivered. Then there was a Boxster we picked up for test (the new 987 model at the time) which was delivered with hardly any engine oil. And then my favourite, the RS4 I drove to Marbella for the M3 launch that was delivered to my home (by Audi) still with its heavily damaged bonnet (after a truck rolled into it).

Anyway back to the topic in hand, as Simon knows I have occasionally influenced the magazine content of EVO, it helps to provide the context of an interesting car in an interesting setting (i.e. driving an Aero 8 to Le Mans), so what manufacturers need to do is to present a few storyboard opportunities that feature their car. The rest is up to the journalists.

One test that I know has always been of interest is to compare a Weissman with an Aero 8, the magazine has often been promised a Weissman but its always failed to be delivered. So if CM had a word with a friendly Weissman owner and delivered it plus an Aero 8 to EVO's offices, then there's a good chance they would test them both and write an article. With the magazine moving from 12 to 13 editions it has become very hard to find time to 'arrange' stories, so if the manufacturer saves them some time then they are likely to be grateful.