Will Coronavirus hit used car prices?
Discussion
anonymous said:
[redacted]
Hey, I am quoting a realistic good news story before other people get in- Lookers and Pendragon both purchased by BMW/Merc/other as a going concern
- 50% of locations disposed of
- 50% of staff lost
- Pension liability moved to the state after a negotiation to save the remaining jobs
- Bankruptcy
- Sold for pence on the pound
- 90% of staff lost
- Pension liability moved to the state
the-photographer said:
"Both companies are highly operationally and financially geared with pension deficits. Pendragon was loss-making in FY19 and Lookers barely profitable and is yet to publish its results due to an ongoing fraud investigation, as well as an FCA investigation," the broker said.
So anyone here buying a used car from them should also check carefully who is providing the warranty on those, warranty by Lookers or Pendragon group entities might not be worth much?Edited by the-photographer on Saturday 23 May 09:41
the-photographer said:
Factual reality at last!
It is indeed.The cold hard facts. A fantastic operation employing 120 very hard working people that’s been decimated at a stroke.
We hear a lot of people on these threads saying how they are getting through this, prices might dip but hey ho.
This is how it is for hundreds of thousands.
And those 120 people all spent there money in local shops, restaurants, takeaways etc.
This is the stuff we lose sight of while we argue about ifs, buts and maybes.
Deep Thought said:
Earthdweller said:
You and both know that the rental fleets change over far more regularly than every two years . Probably most of your “nearly new” sales stock is ex rental
Those 16k cars over over two years are more realistically changes twice a year meaning 64k cars
Now it depends who owns them and the demand .. same for those 380 coaches, most of which seem to be high end and new
If they are now owned by a bank and liquidator are they going to drip them into a market that might not be there or just fire sale them ?
Neither you or I know that
It’s the same with Hertz. Their 16k fleet is probably 32k new sales for manufacturers per year and 32k used cars for you to retail
If they go pop and aren’t buying the new ones and depending on who has title to the ones on the fleet .. if they are leased from manufacturers maybe they could be retained/dripped into the market, but if they are owned by banks/creditors it could be messy surely ?
I genuinely don’t know how they are funded so I’m just guessing
Its never in a million years every six months. Its around a year and a bit, or when they hit a specific mileage. Its in noones interest to change them every six months.Those 16k cars over over two years are more realistically changes twice a year meaning 64k cars
Now it depends who owns them and the demand .. same for those 380 coaches, most of which seem to be high end and new
If they are now owned by a bank and liquidator are they going to drip them into a market that might not be there or just fire sale them ?
Neither you or I know that
It’s the same with Hertz. Their 16k fleet is probably 32k new sales for manufacturers per year and 32k used cars for you to retail
If they go pop and aren’t buying the new ones and depending on who has title to the ones on the fleet .. if they are leased from manufacturers maybe they could be retained/dripped into the market, but if they are owned by banks/creditors it could be messy surely ?
I genuinely don’t know how they are funded so I’m just guessing
If i were the bank / liquidator i'd be talking to the companies who were committed to buying them back and negotiating their disposal over their network over a period of several months. Theres ways and means. It'll never be 32,000 year old Golfs dropped in to your local BCA auction.
Why?
Because the vehicle hire market doesn't operate in a functional fashion. It cannot generate enough cash from operations (rentals). Instead, it relies on heavy manufacturer discounts (massive!) with the caveat that they MUST NOT sell them for 6 months. As soon as that deadline passes they are free to sell them on to anybody (often back to the manufacturer themselves) at a price higher than the original invoice value. It's completely crazy, but it helps manufacturers hit volume targets and provides a steady flow of approved used cars in the franchise network for people who aren't prepared to wait for factory orders.
kevinon said:
I was intrigued to learn that Pendragon's revenue is over £ 4 billion.
But investors have suffered for years. The share price has dropped from £116 before the Financial Crisis, to £41 in 2016, and now down to £7 a share.
You could buy Pendragon for £109 million today. Surely the stock alone would be worth many times that? Am I missing something?
Throttlebody said:
No, you just quoted turnover because you don’t understand the difference between revenue and the significance of company YOY profit/loss, particularly for Pendragon, carrying a significant 2019 loss. Realism, not your strength.
Says the unemployed armchair expert. 
You've googled Pendragon
I'm in awe!
As i said, i'm sure you're gleeful they're in trouble.
Edited by Deep Thought on Saturday 23 May 13:36
r1monkey said:
kevinon said:
I was intrigued to learn that Pendragon's revenue is over £ 4 billion.
But investors have suffered for years. The share price has dropped from £116 before the Financial Crisis, to £41 in 2016, and now down to £7 a share.
You could buy Pendragon for £109 million today. Surely the stock alone would be worth many times that? Am I missing something?
av185 said:
Auto810graphy said:
jsf said:
Watching the Silverstone Auctions May Auction at the moment.
Thanks for the update!Jay Kay's M3 has made a huge amount for what it is! £84.5K
andymc said:
has the white Sierra RS been through yet?
Yes, lot list is done in order.https://www.silverstoneauctions.com/events/2020-au...
Chucklehead said:
Hertz has filed for bankruptcy. I'd said at the start of this thread that Car Rental companies will flood the market with whatever they can, and it's already happening.
https://jalopnik.com/hertz-just-dumped-a-bunch-of-...
In fairness Hertz has been on shaky ground for years, but only a month or so ago they had the same rating as Government bonds!
They have filed for bankruptcy protection which is very a very different thing..https://jalopnik.com/hertz-just-dumped-a-bunch-of-...
In fairness Hertz has been on shaky ground for years, but only a month or so ago they had the same rating as Government bonds!
skeeterm5 said:
Chucklehead said:
Hertz has filed for bankruptcy. I'd said at the start of this thread that Car Rental companies will flood the market with whatever they can, and it's already happening.
https://jalopnik.com/hertz-just-dumped-a-bunch-of-...
In fairness Hertz has been on shaky ground for years, but only a month or so ago they had the same rating as Government bonds!
They have filed for bankruptcy protection which is very a very different thing..https://jalopnik.com/hertz-just-dumped-a-bunch-of-...
In fairness Hertz has been on shaky ground for years, but only a month or so ago they had the same rating as Government bonds!
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