What,Can and Should Mclaren be Doing About Protecting Resale
Discussion
Cheib said:
Maybe the difference is now the order books weren’t as bulging as they were ? They must be finding it harder to sell cars than they were a 12 or 24 months ago....certainly depreciation seems to be accelerating if anything....judging by delivery mileage cars up for sale at big discounts to RRP. At some stage they have to care....they can’t ignore it forever because people will stop buying their cars.
Whether they actually do anything about it who knows.
I agree I'm sure I'm not alone on PH by stating that I'd be happy to pay list for a 720 if depreciation was way better than it is, also supplying dealers not wanting to bid on a car (straight sale) is ludicrous IMO plus cars should be better sorted from the factory.Whether they actually do anything about it who knows.
As for Ron Dennis's much trumpeted being fanatical that every detail of the car etc had to be right (including the Showroom floor), I was in a Mac dealership in 2012 looking at two new 12C's and I myself are a bit faddy on detail so I noticed on the front offside wheel arch at the top vertical surface there are two panels (about 50mm in height) that come together and one of these were vertical however the other started vertical but protruded out at the bottom of the wheel arch by 5mm.
I drew this to the attention of the SE who brushed the matter off saying they would fix it and that it was just a "one-off problem" however looking at the other car in the showroom it had exactly the same fault on the off side front wheel arch!!!!! and IMO so much for Ron's fastidious nature!
So I wasn't impressed by the SE's apology and left disappointed with the brand and decided to keep my recently purchased 991.1 C2S.
I suppose if you're purchasing a car through a company the £negative aspects are a secondary irritation however like others on here my cars are a private purchase so until Mac improves I'll stick with P models.
Yours,... Disappointed
I think there’s a broad sentiment of agreement here.
1) Mostly great cars.
2) Mostly poor service.
3) Totally naive business model.
Friend of mine has 675LT, Porsche die hard, and he loves it. Only Mac I would consider.
But I won’t consider one or any new Mac, because of point 3.
Unless they take on board some of the suggestions proposed on here, they will actually fail as a Company, which would be a shame. Their balance sheet suggests this needs to be sooner rather than later. I hope they listen.
1) Mostly great cars.
2) Mostly poor service.
3) Totally naive business model.
Friend of mine has 675LT, Porsche die hard, and he loves it. Only Mac I would consider.
But I won’t consider one or any new Mac, because of point 3.
Unless they take on board some of the suggestions proposed on here, they will actually fail as a Company, which would be a shame. Their balance sheet suggests this needs to be sooner rather than later. I hope they listen.
Cheib said:
Maybe the difference is now the order books weren’t as bulging as they were ? They must be finding it harder to sell cars than they were a 12 or 24 months ago....certainly depreciation seems to be accelerating if anything....judging by delivery mileage cars up for sale at big discounts to RRP. At some stage they have to care....they can’t ignore it forever because people will stop buying their cars.
Whether they actually do anything about it who knows.
I think it's a bit of a stretch to say the order books were ever bulging. And they have cranked up production year on year so given discounts were available on cars last year, with more produced the next it's hardly a surprise they are needing even bigger ones to shift.... And that's irrespective of whether they fix the aftersales service situation which whatever people say, what that has been actually done on that front has been the absolute bare minimum so far to scrape by. As long as they are shifting more cars (and one assumes even with discounts that's above unit production cost) Mclaren management seem to think that's target achieved with their only focus on how to increase production even further.Whether they actually do anything about it who knows.
isaldiri said:
As long as they are shifting more cars (and one assumes even with discounts that's above unit production cost) Mclaren management seem to think that's target achieved with their only focus on how to increase production even further.
Such an MO is, dare I say it, similar to McDonaldsmickpsu said:
Can you elaborate on this please.
When researching for one of my clients a while back I seem to remember a large bond issue to pay off Ron and boost cash balance, followed by a share issue to raise further cash some months later. Although running at a loss the board appear happy with strong demand for the cars, hence ability and need to keep ramping up production to turn loses into profit. I’m sure a quick google search will bring up full info/detail as a listed company.garystoybox said:
When researching for one of my clients a while back I seem to remember a large bond issue to pay off Ron and boost cash balance, followed by a share issue to raise further cash some months later. Although running at a loss the board appear happy with strong demand for the cars, hence ability and need to keep ramping up production to turn loses into profit. I’m sure a quick google search will bring up full info/detail as a listed company.
I have already pulled down the accounts from CH for McLaren Automotive Ltd and McLaren Holdings Ltd. I was interested in Robbo66’s comment “Their balance sheet suggests this needs to be sooner rather than late”.mickpsu said:
Robbo66 said:
Their balance sheet suggests this needs to be sooner rather than later. I hope they listen.
Can you elaborate on this please.Q1 2019 results are out next week. Pretty conservative balance sheet in terms of leverage....sales up pretty sharply (shock!) but they’re still burning cash. Don’t think there’s anything significant as shareholders have deep pockets.
Every successful long term business understands the importance of balancing supply and demand..To ignore this simple mantra in a shortsighted quest for short term sales boost will ultimately lead to a financial crisis..
In McLaren's case they just need to emulate Ferrari or Porsche who have carefully nurtured an enviable reputation for perceived desirability.
I'd love to buy a McLaren and will at some point but never a brand new one simply because i can't afford to burn £50-100K of pre-taxed income on a regular basis....quite simply it would eventually bankrupt me..Its basically my children's inheritance which is funding my expensive car hobby so a degree of circumvent is required to avoid later financial ruin.
Apart from the obvious need for McLaren to drastically improve all aspects of after sales service, more immediate changes need to be employed at new car sales level..First of all match build numbers to realistic demand by avoiding flooding showrooms with new pre-specced cars..The second point is to price new cars realistically by including options which should be standard and avoid discounting altogether.
Another thing is to spend much less on developing new look models every few months and divert the money towards quality control..
This is simple stuff and needs to carried out sooner rather than later IMO..
In McLaren's case they just need to emulate Ferrari or Porsche who have carefully nurtured an enviable reputation for perceived desirability.
I'd love to buy a McLaren and will at some point but never a brand new one simply because i can't afford to burn £50-100K of pre-taxed income on a regular basis....quite simply it would eventually bankrupt me..Its basically my children's inheritance which is funding my expensive car hobby so a degree of circumvent is required to avoid later financial ruin.
Apart from the obvious need for McLaren to drastically improve all aspects of after sales service, more immediate changes need to be employed at new car sales level..First of all match build numbers to realistic demand by avoiding flooding showrooms with new pre-specced cars..The second point is to price new cars realistically by including options which should be standard and avoid discounting altogether.
Another thing is to spend much less on developing new look models every few months and divert the money towards quality control..
This is simple stuff and needs to carried out sooner rather than later IMO..
The Surveyor said:
nw942 said:
I'm sure they've still got plenty of ideas to increase power whilst meeting emissions.
But if something like mild-hybrid gives them the performance gains at a lower cost they will surely go down that path?
Porsche already make plenty of turbocharged 911's, not just the 'Turbo' and the GT2 but everything else in the range is forced-induction with the exception of the 'GT3' versions, and I'll put my hat on the 992 GT3 having a turbo too. They won't do a hybrid, but they will do an all-electric 911 in the very near future IMHO.But if something like mild-hybrid gives them the performance gains at a lower cost they will surely go down that path?
Regardless, the resale value of the 911 isn't linked to performance, adding performance doesn't matter to the investors, it's all about the mystique of their GT cars, and then letting that illusion filter down to their ordinary models. On paper, the GT3 RS are only marginally quicker than the cooking 992 Carrera 4s (0-60 of 3.2 against 3.4, and 193mph against 190mph), and all are trounced by the Turbo S (0-60 2.9 & 205mph), yet only the GT versions are seen as 'investments' with the other cars suffering almost normal depreciation. The Porsche marketing machine has convinced buyers that the 911 you really want isn't the fastest accelerating, isn't the one with the highest top speed, isn't the one with the best equipment, isn't the one with 4-seat practicality, isn't the one you can use everyday, its the GT3's, the special one, the unobtainable one.
It doesn't matter how much better the 600LT is than a GT3 RS, if everybody who wants a 600LT can get one, and can potentially get one at a discount there will never be flattening of that depreciation curve, simple supply & demand economics. McLaren need to engineer increased demand, they need to sharpen up their marketing and they need to get to a place where there are more buyers wanting their cars than there are cars. Its the same problem Aston Martin have, Bentley has, Rolls Royce has, Lotus has, BMW has... it's not an exclusively McLaren problem despite what the OP would suggest.
As for the rest of the 992.2 range, then will they ditch the turbos i.e. go back to NA and use hybrid to meet performance/emissions targets?
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On the subject of depreciation, then to me the LT cars are the halo cars and should offer the better residuals. The nice thing is that they have tried to make the 600LT available to anyone who wants them for a year IIRC, which is a frequent criticism of Porsche with the GT3. Clearly it works against maintaining good residuals, but that limited production may help the LT depreciation curve in the future.
The other cars, 570, 720 etc. are not viewed as halo cars and will suffer the same depreciation as a 911 Carrera.
Funny thing is some dealers even play games hiding from facts.
When I tried to negotiate for a brand new 600LT last year at launch they scared me with the low number of allocation story, then you find they’ve built many unsold now sat on showroom?
Just their bad luck, not expected lack of demand, or trying to fool customer asking for big money when reality is they will flood showroom with many LT cars and at the end cars will lose value due to lack of exclusivity?
When I tried to negotiate for a brand new 600LT last year at launch they scared me with the low number of allocation story, then you find they’ve built many unsold now sat on showroom?
Just their bad luck, not expected lack of demand, or trying to fool customer asking for big money when reality is they will flood showroom with many LT cars and at the end cars will lose value due to lack of exclusivity?
RBT0 said:
Funny thing is some dealers even play games hiding from facts.
When I tried to negotiate for a brand new 600LT last year at launch they scared me with the low number of allocation story, then you find they’ve built many unsold now sat on showroom?
Just their bad luck, not expected lack of demand, or trying to fool customer asking for big money when reality is they will flood showroom with many LT cars and at the end cars will lose value due to lack of exclusivity?
I don’t think dealers are hiding facts, I don’t think they know in terms of total production or availability When I tried to negotiate for a brand new 600LT last year at launch they scared me with the low number of allocation story, then you find they’ve built many unsold now sat on showroom?
Just their bad luck, not expected lack of demand, or trying to fool customer asking for big money when reality is they will flood showroom with many LT cars and at the end cars will lose value due to lack of exclusivity?
andrew said:
Rocketreid said:
Back on op
On very good authority McLaren will not be opening any new dealerships soon and will try and limit this years new car production to 2018 levels circa: 4,800.
mclaren bramshaw opens in a couple of weeks !On very good authority McLaren will not be opening any new dealerships soon and will try and limit this years new car production to 2018 levels circa: 4,800.
McLaren New Forest will open its new showroom at Bramshaw, Hampshire in May 2019.
David Gilbert, managing director of McLaren Automotive Europe, said: “The McLaren retail network continues to expand as two of the first three cars announced under our £1.2bn Track25 plan enter production.
Ferruccio said:
andrew said:
Rocketreid said:
Back on op
On very good authority McLaren will not be opening any new dealerships soon and will try and limit this years new car production to 2018 levels circa: 4,800.
mclaren bramshaw opens in a couple of weeks !On very good authority McLaren will not be opening any new dealerships soon and will try and limit this years new car production to 2018 levels circa: 4,800.
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