720s Below 200K Already
Discussion
I don't think it is a Maclaren problem per se. The 720 just happens to sit at a price point where there are not many buyers. Car prices (and performance specs) have gone AWOL over the last couple of years and we are probably reaching a point where the market just can't absorb these cars. Porsche and Ferrari still manage to sell some cars as they are slightly under the 200k point with their volume models and then there is a market for the collector cars at 350k+. Everything in between is not shifting. People have accepted the power and price hike due to cheap financing deals so the monthly installment is more a benchmark than the actual price. Now residuals and also eventuelly interest rate start pushing these rates up and at 200k it is no longer everymans game.
hornbaek said:
I don't think it is a Maclaren problem per se. The 720 just happens to sit at a price point where there are not many buyers. Car prices (and performance specs) have gone AWOL over the last couple of years and we are probably reaching a point where the market just can't absorb these cars. Porsche and Ferrari still manage to sell some cars as they are slightly under the 200k point with their volume models and then there is a market for the collector cars at 350k+. Everything in between is not shifting. People have accepted the power and price hike due to cheap financing deals so the monthly installment is more a benchmark than the actual price. Now residuals and also eventuelly interest rate start pushing these rates up and at 200k it is no longer everymans game.
I think there is alot of truth in what you say,there appears to be two markets running side by side now:People who buy the cars to own them with the longer term intent of keeping them and or trading up every few years
And
People who buy the car and will drive it on a month to month basis while they can afford it or have the desire to continue to afford it.
I think the monthly payment/pcp with balloon payment option has certainly brought a large volume of people into the market that otherwise wouldn’t have bought these cars and the manufacturers have jumped on the band wagon as you would expect a business to do,to pump it for all its worth while it continues.
Manufacturers aren’t going to be too upset about the used cars left behind if the bottom does fall out of the market,they are only worried about obtaining their share of the new car market on a monthly basis and will obtain it by any means nessecary.
I think the majority of these first time to the market buyers are also not participants on here as this is a forum for car nuts and true enthusiasts. My guess would be that many of these buyers have a very different outlook about ownership and the car scene and buy for very different reasons to the hardcore folk on here.
A lot of new entrants to these markets are buying the cars as the must have latest fashion accessory with little other knowledge about the cars or car market. IMO that’s why you see alot of nearly new low miles hardly used cars returned to the showroom. The purchaser after several months thinks sod keep paying out £2000-£3000 a month once the novetity has worn off and all their friends have seen it.
I’ve seen this type of buyer turn up at cars meets with little idea as to what they have actually bought whether it be Macca, Lambo, Porsche, Ferrari, Aston etc,etc. When you talk to them they tell you “oh I just got this and thought I would come to a car meet see what it’s all about” the facts are that once they’ve done it you rarely see them again as they are not really that committed to the scene like us nutters on here!!!
I can’t realky see anyone setting out with the intent on walking into a showroom to fork out a £40k deposit and £3k a month if they knew that they would be going back to the dealer a few short months later to bail out of the situation and loose a packet in the process. I am sure the dealers tell them during the buying process that once they are in the balloon will be covered at the end of the deal and although not guaranteed they will probably have enough left over for the deposit on the next car,it all sounds good while the candle of desire is burning.
We on here are only a small minority of the buyers at large and most certainly wouldn’t keep the manufacturers in caviar for long. Our opinions are strong due to our obsession but we most probably only represent a few percentage points of the overall buyers out there.
It’s a bit like the times when city bonus payments led to a swaith of high end new car purchases only to see them dumped after the novilty had worn off,now it’s done on PCP.
Edited by Juno on Monday 4th March 09:55
hornbaek said:
I don't think it is a Maclaren problem per se. The 720 just happens to sit at a price point where there are not many buyers. Car prices (and performance specs) have gone AWOL over the last couple of years and we are probably reaching a point where the market just can't absorb these cars. Porsche and Ferrari still manage to sell some cars as they are slightly under the 200k point with their volume models and then there is a market for the collector cars at 350k+. Everything in between is not shifting. People have accepted the power and price hike due to cheap financing deals so the monthly installment is more a benchmark than the actual price. Now residuals and also eventuelly interest rate start pushing these rates up and at 200k it is no longer everymans game.
Herein lies a very pertinent point. It seems that everything around the purchasability (did I just make that word up?) centres around the monthly finance cost rather than the full purchase price. You look at all the car buying websites, dealer websites etc, there is a heavy emphasis on monthly cost based on finance based purchase. Suddenly a £200k car is not £200k, it is £1100 per month or whatever based on a deferred final payment option, which is not mandatory, in that you can hand the car back. If finance becomes more expensive, then the outright purchase costs of cars will drop, as less people may be able to afford to get in them and when demand drops....
This is just one reason, of course and some marques have their own challenges associated with residual performance. It is however, a major factor.
I watched a SHMEE video the other day about his financing of the Senna and Ford GT,as well as he has done he didn’t have 1.5 million cash on tap.
He clearly describes buying the cars on finance and using the residual value to make the payments affordable.
With the two cars he has bought he may well be in a relitivleley safe position due to both the Senna name and rarity of the Ford GT,at the moment though he is clearly renting rather than owing these cars.
I think his intention will be to buy them at some point but only time will tell if he really is a true enthusiast or an enthusiastic complex business mascarading as a car flipper!
He clearly describes buying the cars on finance and using the residual value to make the payments affordable.
With the two cars he has bought he may well be in a relitivleley safe position due to both the Senna name and rarity of the Ford GT,at the moment though he is clearly renting rather than owing these cars.
I think his intention will be to buy them at some point but only time will tell if he really is a true enthusiast or an enthusiastic complex business mascarading as a car flipper!
Superleg48 said:
Herein lies a very pertinent point. It seems that everything around the purchasability (did I just make that word up?) centres around the monthly finance cost rather than the full purchase price. You look at all the car buying websites, dealer websites etc, there is a heavy emphasis on monthly cost based on finance based purchase. Suddenly a £200k car is not £200k, it is £1100 per month or whatever based on a deferred final payment option, which is not mandatory, in that you can hand the car back.
If finance becomes more expensive, then the outright purchase costs of cars will drop, as less people may be able to afford to get in them and when demand drops....
This is just one reason, of course and some marques have their own challenges associated with residual performance. It is however, a major factor.
One thing that has become more popular in the last year with us in month to month hires from people who would normally just go out and buy one. If finance becomes more expensive, then the outright purchase costs of cars will drop, as less people may be able to afford to get in them and when demand drops....
This is just one reason, of course and some marques have their own challenges associated with residual performance. It is however, a major factor.
We've got a few customers that have had one of our cars for the last 6 months and like it because we chop and change with them when needed so they get a variety of super cars without the need of losing a s
t tonne of money each time.Things are changing in the super car world, people just aren't as keen to keep changing when the latest shiny thing comes out.
I agree, I think there's a lot of truth in the fact that the majority of current customers for those marks are not car nutters like us lot and if true this also goes someway to explaining why McLaren may be suffering more depreciation than Ferrari, Porsche and Lambo - given that it is a newer (to road cars) and less well known marque around the world, to most non-F1 fans, it's also less likely to be on the desirable list for those just wanting to tell their friends about their latest toy, if their friends have only really heard about F, P & L - though by no means the only reason.
Must admit I’m tempted to go and have a look at the Hatfield car, working not too far away at the moment and if it’s straight then why not? I’ll be do 6-10k/year in mine and plan to keep for a few years so the ‘high’ mileage now not too much of an issue if it saves me a chunk of change - then in a couple of months with the Spiders coming through what will happen as cars start being swapped, but you only live once...
Juno said:
I watched a SHMEE video the other day about his financing of the Senna and Ford GT,as well as he has done he didn’t have 1.5 million cash on tap.
He clearly describes buying the cars on finance and using the residual value to make the payments affordable.
With the two cars he has bought he may well be in a relitivleley safe position due to both the Senna name and rarity of the Ford GT,at the moment though he is clearly renting rather than owing these cars.
I think his intention will be to buy them at some point but only time will tell if he really is a true enthusiast or an enthusiastic complex business mascarading as a car flipper!
A bit of both, I think. He definitely started out as a true enthusiast, and I do think that his love for the cars is still very much alive. However, over time, the business side of things has become more apparent, putting crazy cars like the Senna within his grasp but - as you say - he's flipping his way up the ladder to get his hands on the keys very quickly. It was always obvious to me which cars he was angling for, with huge periodic promotion of Porsche, McLaren and Ford on his social media channels, inevitably resulting in "I'm getting a [INSERT LIMITED MODEL]!"He clearly describes buying the cars on finance and using the residual value to make the payments affordable.
With the two cars he has bought he may well be in a relitivleley safe position due to both the Senna name and rarity of the Ford GT,at the moment though he is clearly renting rather than owing these cars.
I think his intention will be to buy them at some point but only time will tell if he really is a true enthusiast or an enthusiastic complex business mascarading as a car flipper!
Charlie360 said:
I agree, I think there's a lot of truth in the fact that the majority of current customers for those marks are not car nutters like us lot and if true this also goes someway to explaining why McLaren may be suffering more depreciation than Ferrari, Porsche and Lambo - given that it is a newer (to road cars) and less well known marque around the world, to most non-F1 fans, it's also less likely to be on the desirable list for those just wanting to tell their friends about their latest toy, if their friends have only really heard about F, P & L - though by no means the only reason.
Yes for sure, it definitely makes a difference being new to this market compared to the history its competitors have!BelfastBoy said:
Juno said:
I watched a SHMEE video the other day about his financing of the Senna and Ford GT,as well as he has done he didn’t have 1.5 million cash on tap.
He clearly describes buying the cars on finance and using the residual value to make the payments affordable.
With the two cars he has bought he may well be in a relitivleley safe position due to both the Senna name and rarity of the Ford GT,at the moment though he is clearly renting rather than owing these cars.
I think his intention will be to buy them at some point but only time will tell if he really is a true enthusiast or an enthusiastic complex business mascarading as a car flipper!
A bit of both, I think. He definitely started out as a true enthusiast, and I do think that his love for the cars is still very much alive. However, over time, the business side of things has become more apparent, putting crazy cars like the Senna within his grasp but - as you say - he's flipping his way up the ladder to get his hands on the keys very quickly. It was always obvious to me which cars he was angling for, with huge periodic promotion of Porsche, McLaren and Ford on his social media channels, inevitably resulting in "I'm getting a [INSERT LIMITED MODEL]!"He clearly describes buying the cars on finance and using the residual value to make the payments affordable.
With the two cars he has bought he may well be in a relitivleley safe position due to both the Senna name and rarity of the Ford GT,at the moment though he is clearly renting rather than owing these cars.
I think his intention will be to buy them at some point but only time will tell if he really is a true enthusiast or an enthusiastic complex business mascarading as a car flipper!
WCZ said:
br d said:
Depreciation to die for, I did 50k in 5 months on mine!
Shake it off and move on though!
I had an S65 from new once, great car but I shudder to think how much I lost esp with the options I had. Shake it off and move on though!
But business was booming at the time and I didn't care
My previous best was 24K in 3 months with a Porsche Turbo, I chopped it for a 430 when it was the new model so the loss was the last thing on my mind!
I do wonder if all this is going to come back to me on my deathbed!
Juno nails it with these comments.
Totally agreed and the big manufacturers know the good times can’t last forever with interest rates. Car prices have become almost farcical now.
Like you say, get into a pcp with no guarantee of the future value and then you are fully exposed to negative equity. Whereas the old days you would just say right that’s 50k of my hard earned lost and cash the car in and move on.
40-50k I’m options on Bentley, Aston , Ferrari are common now. As you know when the cars get to 5-7yra old clearly a buyer won’t be paying 40k more for one with much better spec it will be more like 10-15k price difference.
Totally agreed and the big manufacturers know the good times can’t last forever with interest rates. Car prices have become almost farcical now.
Like you say, get into a pcp with no guarantee of the future value and then you are fully exposed to negative equity. Whereas the old days you would just say right that’s 50k of my hard earned lost and cash the car in and move on.
40-50k I’m options on Bentley, Aston , Ferrari are common now. As you know when the cars get to 5-7yra old clearly a buyer won’t be paying 40k more for one with much better spec it will be more like 10-15k price difference.
Juno said:
I think there is alot of truth in what you say,there appears to be two markets running side by side now:
People who buy the cars to own them with the longer term intent of keeping them and or trading up every few years
And
People who buy the car and will drive it on a month to month basis while they can afford it or have the desire to continue to afford it.
I think the monthly payment/pcp with balloon payment option has certainly brought a large volume of people into the market that otherwise wouldn’t have bought these cars and the manufacturers have jumped on the band wagon as you would expect a business to do,to pump it for all its worth while it continues.
Manufacturers aren’t going to be too upset about the used cars left behind if the bottom does fall out of the market,they are only worried about obtaining their share of the new car market on a monthly basis and will obtain it by any means nessecary.
I think the majority of these first time to the market buyers are also not participants on here as this is a forum for car nuts and true enthusiasts. My guess would be that many of these buyers have a very different outlook about ownership and the car scene and buy for very different reasons to the hardcore folk on here.
A lot of new entrants to these markets are buying the cars as the must have latest fashion accessory with little other knowledge about the cars or car market. IMO that’s why you see alot of nearly new low miles hardly used cars returned to the showroom. The purchaser after several months thinks sod keep paying out £2000-£3000 a month once the novetity has worn off and all their friends have seen it.
I’ve seen this type of buyer turn up at cars meets with little idea as to what they have actually bought whether it be Macca, Lambo, Porsche, Ferrari, Aston etc,etc. When you talk to them they tell you “oh I just got this and thought I would come to a car meet see what it’s all about” the facts are that once they’ve done it you rarely see them again as they are not really that committed to the scene like us nutters on here!!!
I can’t realky see anyone setting out with the intent on walking into a showroom to fork out a £40k deposit and £3k a month if they knew that they would be going back to the dealer a few short months later to bail out of the situation and loose a packet in the process. I am sure the dealers tell them during the buying process that once they are in the balloon will be covered at the end of the deal and although not guaranteed they will probably have enough left over for the deposit on the next car,it all sounds good while the candle of desire is burning.
We on here are only a small minority of the buyers at large and most certainly wouldn’t keep the manufacturers in caviar for long. Our opinions are strong due to our obsession but we most probably only represent a few percentage points of the overall buyers out there.
It’s a bit like the times when city bonus payments led to a swaith of high end new car purchases only to see them dumped after the novilty had worn off,now it’s done on PCP.
People who buy the cars to own them with the longer term intent of keeping them and or trading up every few years
And
People who buy the car and will drive it on a month to month basis while they can afford it or have the desire to continue to afford it.
I think the monthly payment/pcp with balloon payment option has certainly brought a large volume of people into the market that otherwise wouldn’t have bought these cars and the manufacturers have jumped on the band wagon as you would expect a business to do,to pump it for all its worth while it continues.
Manufacturers aren’t going to be too upset about the used cars left behind if the bottom does fall out of the market,they are only worried about obtaining their share of the new car market on a monthly basis and will obtain it by any means nessecary.
I think the majority of these first time to the market buyers are also not participants on here as this is a forum for car nuts and true enthusiasts. My guess would be that many of these buyers have a very different outlook about ownership and the car scene and buy for very different reasons to the hardcore folk on here.
A lot of new entrants to these markets are buying the cars as the must have latest fashion accessory with little other knowledge about the cars or car market. IMO that’s why you see alot of nearly new low miles hardly used cars returned to the showroom. The purchaser after several months thinks sod keep paying out £2000-£3000 a month once the novetity has worn off and all their friends have seen it.
I’ve seen this type of buyer turn up at cars meets with little idea as to what they have actually bought whether it be Macca, Lambo, Porsche, Ferrari, Aston etc,etc. When you talk to them they tell you “oh I just got this and thought I would come to a car meet see what it’s all about” the facts are that once they’ve done it you rarely see them again as they are not really that committed to the scene like us nutters on here!!!
I can’t realky see anyone setting out with the intent on walking into a showroom to fork out a £40k deposit and £3k a month if they knew that they would be going back to the dealer a few short months later to bail out of the situation and loose a packet in the process. I am sure the dealers tell them during the buying process that once they are in the balloon will be covered at the end of the deal and although not guaranteed they will probably have enough left over for the deposit on the next car,it all sounds good while the candle of desire is burning.
We on here are only a small minority of the buyers at large and most certainly wouldn’t keep the manufacturers in caviar for long. Our opinions are strong due to our obsession but we most probably only represent a few percentage points of the overall buyers out there.
It’s a bit like the times when city bonus payments led to a swaith of high end new car purchases only to see them dumped after the novilty had worn off,now it’s done on PCP.
Edited by Juno on Monday 4th March 09:55
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