Talk Morgan Forums Community The Malvern Arms Another senior appointment

I believe that's a given, this appointment very much indicates the investors are not happy with current performance and projected returns so requiring a sort out.

Correct Britmog, but as an Investindustrial appointee, that's Massimo's job..
I suspect bigger things are afoot....

They have built complexity into the product, and have increased prices to match. They have spent a lot of money on "upmarketing" the factory. They have increased staff costs significantly at the top.

Perhaps the hope is that 3 wheeler sales will grow to bring a return on the investment, but the CX cars are expensive niche toys. Growth numbers in this zone must be limited, and there are already used CXs in the market.

I hope MMC gets through this, but the current range doesn't interest me at all.

Perhaps it is the fallout from the recall that needs careful management?

Despite Dave W's lack of interest in the CX range of cars, there is a whole new group of potential buyer to replace him and people who share his views. My son (36) had no interest in Morgans when I bought my 4/4 Sport. He has owned a variety of cars including a BMW M3, an Audi RS6 and a 300bhp mini, but since I have owned the Plus Six, he thinks it is one of the best cars he has ever driven. Some of his similar-aged friends agree and with modern leasing, they can also acquire one without waiting until they retire.

Perhaps this was MMC's intention all along? A new audience and the chance to grow the company with new money?

It might just work!

Good points. Car purchase these days is often not about total price; instead it’s just what monthly payments you think you can afford!

So this feels a little like speculation.

I have done enough with VC to see how you can work with or in-spite of them. It is a state of mind as much as anything else. VC is intended to give you a rapid leg up and go to market faster. Done well it can bring experience, skills, access to rolodex and innovation to a business. If you work together it can iron out growth and other issues. If things are going in the right direction, you are transparent, and they can see their money being used well it works. When things go wrong, you hide stuff or they disagree then it gets squeaky quickly.

Private Equity is a slightly different game. You are looking for under valued assets or landlocked (family owned, controlled market etc) businesses that are under valued. You may not be in it for a long haul, some rudely say strip'n'flip but again I would say work with them and it may be different. There are good and bad in all sectors. Aston seems to be an interesting comparison at this point, how are they doing and what part has II had in it? I don't know the answer.

We know the Morgan brand has equity. How would you go about making it more profitable as a business. I don't mean that in a bad manner, a business is there to make money.
We think there are some gaps in quality and service (so bringing in skills would seem wise?)
Bringing the price of a relatively custom, handbuilt(ish), highly differentiated product up to comparables?
Getting it in front of more people with the net worth to make a discretionary purchase?
Broadening out the markets you can sell it in (prey it does not need lots of spares etc!)
Maybe further changes in the factory to optimise for growth, more personalisation or better service?

All common sense.
It's not as if the factory was over-staffed or lax from the comments I see. It was run tightly to make a profit. Investment brings more opportunity, where do you spend it. First. Is that in the skills set of the current team as they have got it to this stage?

As long as the results show well it is a great opportunity. When it burps then the knives are sharp. Keep your friends close.

Alistair, well said.

Fair point. As the world moves to a renting model rather than ownership, it introduces a whole new potential market. The dinosaurs like me who believe in saving up for something and buying it outright are a rapidly diminishing species - let's hope the BoE can keep inflation under control without having to jack interest rates up too much further, otherwise life could get very expensive for generation rent.

+1

its not just the interest rates but also the residual value at the end of the contract that will impact renting monthly costs, and with potentially new updates being released each year, the desirability of a given model year and therefore retention value will be affected. Already from discussions in the trade people are looking at MY22 in preference to earlier cars even though in some cases the differences car be minor.



Then its the old problem of 'pub talk' what model year is yours ,and then the inevitable why did you buy that year had nothing but problems eg lack of comfort seats of course there will be those seeking the earlier purer pre traction control models. But I would suggest those new to the marque on rental contract will want all the bells and whistles which might lead to some really nice used cars coming up at the contract end. Of course if they over supply the used market, then residuals may well fall.


I'm sure public listing of Morgan may be an ambition.........make a real investment killing.