Right time to buy?

[L00b 441]

All this would suggest slashing prices. Some manufacturers/dealers have been offering BOGOF deals. I cannot understand why GME and Ford Europe are raising prices....yes I understand the pound has fallen in value and they are having to pay more for components impored into the UK assembly plants, but cars are build all over Europe...hardly any are built in the UK any more.

 

Don't mistake revenue with stock (asset) value They're both based on the same tangibles, but are distinct entities altogether, and each has a distinct relevance to a company's valuation.

 

New cars are not going to sell any faster when discounted, unless of course you're looking at "very serious" discounts (beyond the BOGOF deals, which are usually a variation on "pay list on premium model, get low/average spec mini/urban model free", wherein margin on premium model = cost of mini model). The market, impacted as it is by the lack of credit availability and people's uncertainty about their future earning power, is taking care of the perceived true worth of cars, new or 2nd hand at the moment, regardless of the price on the windscreen or the list.

 

The list price, of itself, means nothing where revenue is concerned, because the list price can always be discounted by dealers (e.g. "list-60%", "list-70%", entire industries have been doing this for decades, most infamously the uPVC companies: I used to hold a sales & marketing role in the Sheffield cutting tool industry in the late 90s, we never sold anything with less than 70% off list). Whereby, provided offer/demand remains the same, revenue remains the same (only the discount varies, but still corresponds to 'nothing': 10% off price X = 50% off price Y).

 

But, as a company, it means your stock (asset) is worth X% more whenever you revise the price list up. The downside is the strength of the currency and interest rates also have a direct impact on the stock value at any time, however this isn't a concern at the present time, here or in the US, with record low base rate and currency in the doldrums.

Edited February 10, 2009 by L00b

[Tomataheeed 10]

Don't mistake revenue with stock (asset) value They're both based on the same tangibles, but are distinct entities altogether, and each has a distinct relevance to a company's valuation.

 

New cars are not going to sell any faster when discounted, unless of course you're looking at "very serious" discounts (beyond the BOGOF deals, which are usually a variation on "pay list on premium model, get low/average spec mini/urban model free", wherein margin on premium model = cost of mini model). The market, impacted as it is by the lack of credit availability and people's uncertainty about their future earning power, is taking care of the perceived true worth of cars, new or 2nd hand at the moment, regardless of the price on the windscreen or the list.

 

The list price, of itself, means nothing where revenue is concerned, because the list price can always be discounted by dealers (e.g. "list-60%", "list-70%", entire industries have been doing this for decades, most infamously the uPVC companies: I used to hold a sales & marketing role in the Sheffield cutting tool industry in the late 90s, we never sold anything with less than 70% off list). Whereby, provided offer/demand remains the same, revenue remains the same (only the discount varies, but still corresponds to 'nothing': 10% off price X = 50% off price Y).

 

But, as a company, it means your stock (asset) is worth X% more whenever you revise the price list up. The downside is the strength of the currency and interest rates also have a direct impact on the stock value at any time, however this isn't a concern at the present time, here or in the US, with record low base rate and currency in the doldrums.

 

I can't see how putting the list price up would increase the share price, even if the nominal value of assets goes up. Difficult to tell with GM and Ford though...share price is about as low as it could go.

 

Increased prices will just squeeze the dealers further. The dealers margin is very low anyway 4%-5%...often lower. The dealers are forced to buy a certain volume from the manufacturer at a certain price in exchange for having a "patch" to sell to. Ford franchises don't want another ford franchise near by. The dealer makes a profit on car sales when they hit their target - e.g. if Lookers sell the 800 cars they agreed to sell, then they get a bonus. the 800 is broken down into 100 KAs, 300 Fiesta etc...

 

I see it as the manufacturers squeezing their franchisees whilst they can - its a desperate act. I think we'll see a mass of dealers and some significant manufacturers go to the wall in the next 12 months.

[Bonjon 10]

Are they? ARE THEY REALLY?

 

Yup there on the up, 2% increase in Jan.

________

Navistar DT engine

Edited February 8, 2011 by Bonjon

[DavidRa 10]

Is it the right time to buy a house??

 

An almost impossible question to answer, the one thing I would say is drive the sellers down on the purchase price, as there are not many willing buyers out there.

Edited February 13, 2009 by BoroughGal
mended faulty quote code

[Dimitri 11 10]

Is it the right time to buy a house??

 

been looking to buy a house seen a few im going to look at but looking at mortgages there so complex, i was going to fix but some of the rates are shocking!!

 

any suggestions for a first time buyer, buying on my own welcome

 

 

cheers

 

P.S i do have a deposit

 

Have a look at at the 'Just put house up for sale', 'will Sheffield house prices recover in 2009' and 'how far will Sheffield house prices drop' threads among others. There are a lot of comments on there and you might be able to pick some things up from them.

 

I am in the same situation as you. What is your situation in terms of saving a monthly amount, are you renting and what is your reason for having NOT bought yet?

[saxondale 10]

Are they? ARE THEY REALLY?

 

 

 

yep ...............

[Lawson 10]

Thanks for the advice its appreciated!

 

With regards to my situation, i live at home still so i dont rent i put just under 50% of my wages away for a deposit so got a bit behind me and i survive on the rest.

 

So this "house" is going to be my first time buy and im going to buy it alone HOPEFULLY but i do have a few people willing to move in if the going gets tough sorter speak....

[L00b 441]

yep ...............

 

Not wanting to turn the wound about the knife, or put some more salt on it, like, but... Sold yours yet?

[Danny_Boy 10]

Thanks for the advice its appreciated!

 

With regards to my situation, i live at home still so i dont rent i put just under 50% of my wages away for a deposit so got a bit behind me and i survive on the rest.

 

So this "house" is going to be my first time buy and im going to buy it alone HOPEFULLY but i do have a few people willing to move in if the going gets tough sorter speak....

 

 

To get you started then you will need at least a 10% deposit and regarding how much you can borrow most lenders will only lend you 4x you annual wage.

[Lawson 10]

Cheers

 

Time to have a good look into it i think

[L00b 441]

To get you started then you will need at least a 10% deposit and regarding how much you can borrow most lenders will only lend you 4x you annual wage.

 

You sure? I was told 3x by my advisor (Yorks Bank) in November and again in January (and even then, that multiple is giving me cold sweats )

[Danny_Boy 10]

You sure? I was told 3x by my advisor (Yorks Bank) in November and again in January (and even then, that multiple is giving me cold sweats )

 

Haha it depends entirley on the lender some will only lend 3x some will lend 4x and I have seen one that will lend 5x, it all depends on the borrowers circumstances aswell. Always best to at least get a quote from an independent advisor