Genune discussion, talk prices up or down?
Discussion
Ok, in view of advice given elsewhere on this forum recently I have a genuine query. One of which I am not really sure of the answer?
Is it better for the marque, owners and prospective owners for advice to be given to 'negotiate' hard as it's a 'buyers market' or to encourage people to take the plunge irrespective as the product is worthy?
I appreciate there are many pro's and con's to both arguments and that Market forces prevail and even the question of whether we CAN really influence prices either way?
A genuine question and one hotly debated in the Porsche forum creating all sorts of mayhem
I have many more thoughts - for both aspects - but am interested in what others think
Boshly
Is it better for the marque, owners and prospective owners for advice to be given to 'negotiate' hard as it's a 'buyers market' or to encourage people to take the plunge irrespective as the product is worthy?
I appreciate there are many pro's and con's to both arguments and that Market forces prevail and even the question of whether we CAN really influence prices either way?
A genuine question and one hotly debated in the Porsche forum creating all sorts of mayhem
I have many more thoughts - for both aspects - but am interested in what others think
Boshly
Whatever path we aim to follow, suspect that market will sort itself out.
There are local houses still for sale at what seem to be too high prices. Others have sold, once there was enough 'blood in the water'. If someone has to sell, there will always be a buyer once the price is low enough.
Probably a good time to pick up a car at a lower price than normal, suspect next year will be even more so.
Limited numbers of Morgans will have an impact though. Is it just my prejudice, or will there be a lot more of the more numerous ‘bankers’ cars like Porches available now? Running costs will also come into the equation, someone on the MX5 forum was ‘outing’ a Boxster for this reason.
Sorry if this is a ‘stream of consciousness’ reply. In summary, if someone has to sell and it is a ‘common’ and expensive to run car then prices will be low. Whatever we say, or try to do, supply and demand will have the last say.
There are local houses still for sale at what seem to be too high prices. Others have sold, once there was enough 'blood in the water'. If someone has to sell, there will always be a buyer once the price is low enough.
Probably a good time to pick up a car at a lower price than normal, suspect next year will be even more so.
Limited numbers of Morgans will have an impact though. Is it just my prejudice, or will there be a lot more of the more numerous ‘bankers’ cars like Porches available now? Running costs will also come into the equation, someone on the MX5 forum was ‘outing’ a Boxster for this reason.
Sorry if this is a ‘stream of consciousness’ reply. In summary, if someone has to sell and it is a ‘common’ and expensive to run car then prices will be low. Whatever we say, or try to do, supply and demand will have the last say.
Boshly,
I'm all for talking up these cars, afterall they are special vehicles, some may say like the owners
I don't understand why they are not more appreciated especially the aeros.
What makes them special well hopefully the rest of the motoring public will find out soon once the GT3 season starts
I'm all for talking up these cars, afterall they are special vehicles, some may say like the owners
I don't understand why they are not more appreciated especially the aeros.
What makes them special well hopefully the rest of the motoring public will find out soon once the GT3 season starts
Asbo
Of course in my biased (but humble) opinion they are extremely special especially certain types and series
The reality is, and Paul kind of touched upon it though contrary to my opinion, we CAN influence the Market a bit. If I logged onto the TVR forum for example, and had my eye on a particular model, say a Sag, and posted "what do people thnk of 'this' car" and 3 or 4 'TVR' guys said "go for it" I most likely would. Bear in mind I am probably looking to be convinced!
TBH that actually happened before I bought my Aero, and it was great advice, I did not drive nor even look at another. So therefore it can happen.
Question is, is it the right thing?
Personally I would never talk someone into a crap car, or someone out of a good one (all IMHO) but would I disclose that "a Sagaris sold for £10k less than the dealer is asking" or keep schtum as why would I knock a dealer (or his client) for a stranger, and in doing so help damage prices?
Obviously above is hypothetical and is criticism of no-one. I can see pros for both sides.
Anyone care to add their opinion?
Cheers
Boshly
Of course in my biased (but humble) opinion they are extremely special especially certain types and series
The reality is, and Paul kind of touched upon it though contrary to my opinion, we CAN influence the Market a bit. If I logged onto the TVR forum for example, and had my eye on a particular model, say a Sag, and posted "what do people thnk of 'this' car" and 3 or 4 'TVR' guys said "go for it" I most likely would. Bear in mind I am probably looking to be convinced!
TBH that actually happened before I bought my Aero, and it was great advice, I did not drive nor even look at another. So therefore it can happen.
Question is, is it the right thing?
Personally I would never talk someone into a crap car, or someone out of a good one (all IMHO) but would I disclose that "a Sagaris sold for £10k less than the dealer is asking" or keep schtum as why would I knock a dealer (or his client) for a stranger, and in doing so help damage prices?
Obviously above is hypothetical and is criticism of no-one. I can see pros for both sides.
Anyone care to add their opinion?
Cheers
Boshly
Information is always good, and why I love the web so much. When unhappy punters can 'slag off' poor goods & services so easily, that is truly excellent.
However with such a specialist car, not sure that passing on details will have an influence on prices. Yes, we can advise of other sale prices, but the circumstances of each pair of buyer and seller will vary. Both can say 'so what'? to other transactions, and will reach their own level if a sale is to take place.
Of course, a few days of good sunshine may well have quite a motivating effect on buyers!
However with such a specialist car, not sure that passing on details will have an influence on prices. Yes, we can advise of other sale prices, but the circumstances of each pair of buyer and seller will vary. Both can say 'so what'? to other transactions, and will reach their own level if a sale is to take place.
Of course, a few days of good sunshine may well have quite a motivating effect on buyers!
Edited by Paul Hurst on Sunday 12th April 19:01
Boshly said:
Obviously above is hypothetical and is criticism of no-one. I can see pros for both sides.
Anyone care to add their opinion?
Cheers
Boshly
Pistonheads can be used by dealers and dealer sycophants to influence sales but there is nowt you can do to stop that. Buyer beware is good advice. Just as down the pub, opinions on the web are just that: opinions.Anyone care to add their opinion?
Cheers
Boshly
Lightningman said:
Boshly said:
Obviously above is hypothetical and is criticism of no-one. I can see pros for both sides.
Anyone care to add their opinion?
Cheers
Boshly
Pistonheads can be used by dealers and dealer sycophants to influence sales but there is nowt you can do to stop that. Buyer beware is good advice. Just as down the pub, opinions on the web are just that: opinions.Anyone care to add their opinion?
Cheers
Boshly
I have my answer.
Tell the truth.
Of course, you'll never be universally loved for that but don't sell out your integrity or that of the marque community by lying to someone asking for honest advice.
It is also born of common sense. A "market" means ongoing trade between buyers and sellers. Brisk sales at lower prices are better than very few sales at higher prices. The longer there are low sales, the bigger the inventory of used cars builds and the more desperate sellers become. Inevitably, residual values collapse.
Anything that can lower that inventory faster is a blessing.
Lorne
Tell the truth.
Of course, you'll never be universally loved for that but don't sell out your integrity or that of the marque community by lying to someone asking for honest advice.
It is also born of common sense. A "market" means ongoing trade between buyers and sellers. Brisk sales at lower prices are better than very few sales at higher prices. The longer there are low sales, the bigger the inventory of used cars builds and the more desperate sellers become. Inevitably, residual values collapse.
Anything that can lower that inventory faster is a blessing.
Lorne
Edited by gomog on Monday 13th April 00:05
Fair enough,
Of course I'm not sure many (any?) decent petrolheads of any persuasion would lie in order to maintain decent residuals ,
However I guess in most cases 'sold' prices tend to be conjecture or at the most second or third hand info and can be subject to exaggeration on both sides and therefore "the truth" or more accurately 'the reality' is harder to establish.
If you really want to maintain prices, to help the marque and to assist the company, get rid of the building used car inventory with frank counsel for both sides.
LorneSorry don't understand what you mean above?
Of course I'm not sure many (any?) decent petrolheads of any persuasion would lie in order to maintain decent residuals ,
However I guess in most cases 'sold' prices tend to be conjecture or at the most second or third hand info and can be subject to exaggeration on both sides and therefore "the truth" or more accurately 'the reality' is harder to establish.
gomog said:
If you really want to maintain prices, to help the marque and to assist the company, get rid of the building used car inventory with frank counsel for both sides.
Lorne
Boshly said:
gomog said:
If you really want to maintain prices, to help the marque and to assist the company, get rid of the building used car inventory with frank counsel for both sides.
Lorne
What I meant to re-underline was that a growing inventory of unsold used cars does not help the marque, the Factory or current residuals. The faster sellers and buyers find new prices they will agree to, the faster inventories decline and prices restabilze.
For a period, it seems a given that certain assets must be priced more modestly to sell...some Morgans included. There is nothing that will freeze a market faster than price uncertainty. Buyers hesitate to buy as they are unsure of what they should offer and sellers hesitate to sell because they are unsure of they should be getting. Nurturing unrealistic expectations won't help anybody.
The first step is to encourage offers be made that the buyers feel comfortable with and let the rest hopefully take a course to a successful conclusion. The other option of a sellers asking high prices and then progressively chopping them is not a great technique in this market. Best idea now is not to set a price, but simply start with a call for offers.
Lorne
I'm not convinced that this forum can influence the prices that much, but it may have some influence on whether someone buys a morgan or not.
I've recently purchased an S3 Aero 8 and it wasn't too difficult to find out that the prices had fallen over the last few months. The information is readily available on the Internet.
I think that some dealers have been VERY slow to react to the reality of the current market and consequently many used cars have been advertised at too high a price.
Hence they don't sell and are eventually heavily discounted. This is not sending out a good message and gives the impression of a sudden fall in value whereas they were never at their true (market) value to start with.
I don't think Morgans have suffered any more than other cars - and to look on the positive side - the lower prices may encourage more people to try a Morgan in the first place.
I've recently purchased an S3 Aero 8 and it wasn't too difficult to find out that the prices had fallen over the last few months. The information is readily available on the Internet.
I think that some dealers have been VERY slow to react to the reality of the current market and consequently many used cars have been advertised at too high a price.
Hence they don't sell and are eventually heavily discounted. This is not sending out a good message and gives the impression of a sudden fall in value whereas they were never at their true (market) value to start with.
I don't think Morgans have suffered any more than other cars - and to look on the positive side - the lower prices may encourage more people to try a Morgan in the first place.
Theoretically, this ought to be a self-regulating mechanism, driven by the normal supply/demand feedback loops, but I'm not entirely sure it actually is the case in practice. Morgans are a 'Marmite' product.
In Theory:
The dealers need to shift their stock, it's more important to them to keep the second-hand market moving than it is either to the private purchaser or the factory. All dealers will intially price stock to the higher end of expectation (above market), there's no sensible alternative strategy when you're in a market where there are more prospective purchasers than there are cars to sell.
So the correct marketing strategy for a dealer in 2nd-hand Mogs to keep the sticker price of their stock just a little way above what the potential customers have in their wallets, and to move that price down as people have less money.
So we may encourage purchasers to be prepared to negotiate a bit harder while the market is depressed, and to see the strategy start to failas the economy starts to pick up and dealers become more confident. Given the poor performance of conventional investment instruments, this may well be skewed a bit earlier than for other commodities because of the good residual performance of Morgans.
In Practice:
The used Morgan market will continue to operate largely as it has always done. Prospective first-time Morgan owners fall in love intitially with the image. Whether it's the '30sw throwback look and feel of the trads, or the high-tech performance with tradition of the Aeros, it's still an emotional pull that gets you first. The punter then goes along to a dealer and drives one, and from that moment the die is cast one way or the other. The punter is either smitten or not, and if they are, then the purchase becomes more or less inevitable.
I don't think that one generally buys a Morgan because it's any good, you buy them because you love them. The fact that they are actually very good indeed is a bonus which proves the decision to purchase was a good one.
I'm sure there are plenty of completely rational Morgan purchasers out there who bought their first Morgan after a careful assessment of the options, and after test-driving a range of cars before making their careful, well-considered decision.
I'm not sure I've ever met one, though
In Theory:
The dealers need to shift their stock, it's more important to them to keep the second-hand market moving than it is either to the private purchaser or the factory. All dealers will intially price stock to the higher end of expectation (above market), there's no sensible alternative strategy when you're in a market where there are more prospective purchasers than there are cars to sell.
So the correct marketing strategy for a dealer in 2nd-hand Mogs to keep the sticker price of their stock just a little way above what the potential customers have in their wallets, and to move that price down as people have less money.
So we may encourage purchasers to be prepared to negotiate a bit harder while the market is depressed, and to see the strategy start to failas the economy starts to pick up and dealers become more confident. Given the poor performance of conventional investment instruments, this may well be skewed a bit earlier than for other commodities because of the good residual performance of Morgans.
In Practice:
The used Morgan market will continue to operate largely as it has always done. Prospective first-time Morgan owners fall in love intitially with the image. Whether it's the '30sw throwback look and feel of the trads, or the high-tech performance with tradition of the Aeros, it's still an emotional pull that gets you first. The punter then goes along to a dealer and drives one, and from that moment the die is cast one way or the other. The punter is either smitten or not, and if they are, then the purchase becomes more or less inevitable.
I don't think that one generally buys a Morgan because it's any good, you buy them because you love them. The fact that they are actually very good indeed is a bonus which proves the decision to purchase was a good one.
I'm sure there are plenty of completely rational Morgan purchasers out there who bought their first Morgan after a careful assessment of the options, and after test-driving a range of cars before making their careful, well-considered decision.
I'm not sure I've ever met one, though
Crikey Boshers, you really seem to be agonising over this with virtually the same thread running on two separate DG's.
What's behind it I ask myself,are you going to sell the family heirlooms or are you thinking of disposing of that 'almost' priceless Series II? It won't be the same around here without the DynaRod Special!
Seriously though, it's a long time since I studied it and I think that the text book is long lost, but from memory aren't all markets heuristic and perfect markets assume the rationality of the players, which in the case of Morgan's cannot be taken as read!
The situation with Aero's is further complicated by the fact that most cars with Dealer's are on a SOR-basis and thus whilst the Dealer can advise on price-levels, the ultimate arbiter is the owner and this can result in some quite strange advertised prices at times as people try to sell their p&j.
This has the unfortunate effect of making it look as if the market for these cars is at one level, whereas in fact they are really being sold at quite a different price level. Having recently sold a Series III and having had correspondence with a number of enthusiasts looking for Aero's I think that mr_tony's pricing format on the other thread, is not too far out (though condition and year do effect it) and I quote:
"Series 1's around in the 30k bracket. Series II's in the 40k bracket, Series 3's in the 50k range and Series 4's in the 60k+ range."
P.S. I like your post Gaspode, particularly the bit about the rational purchasers of Morgan's
What's behind it I ask myself,
Seriously though, it's a long time since I studied it and I think that the text book is long lost, but from memory aren't all markets heuristic and perfect markets assume the rationality of the players, which in the case of Morgan's cannot be taken as read!
The situation with Aero's is further complicated by the fact that most cars with Dealer's are on a SOR-basis and thus whilst the Dealer can advise on price-levels, the ultimate arbiter is the owner and this can result in some quite strange advertised prices at times as people try to sell their p&j.
This has the unfortunate effect of making it look as if the market for these cars is at one level, whereas in fact they are really being sold at quite a different price level. Having recently sold a Series III and having had correspondence with a number of enthusiasts looking for Aero's I think that mr_tony's pricing format on the other thread, is not too far out (though condition and year do effect it) and I quote:
"Series 1's around in the 30k bracket. Series II's in the 40k bracket, Series 3's in the 50k range and Series 4's in the 60k+ range."
P.S. I like your post Gaspode, particularly the bit about the rational purchasers of Morgan's
mph said:
I'm not convinced that this forum can influence the prices that much,
You are quite right. For Morganistes, this forum is too small to influence anything price-wise beyond the rare buyer who stumbles on it. mph said:
I've recently purchased an S3 Aero 8 and it wasn't too difficult to find out that the prices had fallen over the last few months. The information is readily available on the Internet.
Yes...and elsewhere as well. mph said:
I think that some dealers have been VERY slow to react to the reality of the current market and consequently many used cars have been advertised at too high a price.
You are right again. However, I would not blame the dealers. Almost all Aeros being sold by dealers are done so on a consignment basis. They did not set these asking prices, the owners did. (Of course, the dealers are often taking a new car order from the same owner and a very high asking price for the old car makes the sale of the new one easier.) mph said:
Hence they don't sell and are eventually heavily discounted. This is not sending out a good message and gives the impression of a sudden fall in value whereas they were never at their true (market) value to start with.
Yes. It is not uncommon in the used car business to find owners in denial..even very aggressively so. Can they be blamed? In this case, the market is small enough so owners can self-reinforce. You are right, taking a few thousand off every week makes it look like a market collapse. Not good for anybody. Additionally, you may be aware that the MMC changed their traditional dealer ordering structure in 2008. Rather than ordering cars when they have an buyer's deposit in hand, dealers are now required to order their annual supply for the year in advance (and pay on factory delivery..buyer or not). This has allowed production to rise but also created a dealer inventory that they must finance and hopefully get rid of, often by discounting. This inventory adds to the used car inventory, is advertised in the same way and also pressures all residuals down.
However, it works both ways. Small markets can be changed faster than large ones. Perhaps, dealer ordering can be addressed in another way. Additionally, withdrawing used cars from the market will help. Most effective would be encouraging buyers to make offers as you did.
mph said:
I don't think Morgans have suffered any more than other cars - and to look on the positive side - the lower prices may encourage more people to try a Morgan in the first place.
Correct. I do believe this is the BEST time to buy a used Aero. Aeros have never had the high residuals of classic Morgans but they have held their own amongst other sports cars.The least expensive cars in the trad Morgan range (new or used) are doing very well on residual prices now...the 4/4s and the Plus 4s. UK Plus 8 residuals have risen..at least for the moment.
Lorne
Edited by gomog on Wednesday 15th April 21:48
You buy for the best price you can haggle and sell for the best price you can get. What helps Morgans is that they are still enthusiasts second cars.
Its an altogether dufferent market with Porkers. Most new cars are company cars with second hands being bought on credit by people who like the the "brand" and the "image". When times get hard they may find they've bought a 20k car with 70k level maintenance costs, so its got to go.
OK these are sweeping generalisations but nevertheless the reason why you are more likely to find a ditress sale amongst second hand Porkers than second hand Morgans.
Will be interesting to see where Lotus fit in this. My guess is that prices will fall more than Morgan. Either way, talking up resale prices or talking them down will not really affect the market
Its an altogether dufferent market with Porkers. Most new cars are company cars with second hands being bought on credit by people who like the the "brand" and the "image". When times get hard they may find they've bought a 20k car with 70k level maintenance costs, so its got to go.
OK these are sweeping generalisations but nevertheless the reason why you are more likely to find a ditress sale amongst second hand Porkers than second hand Morgans.
Will be interesting to see where Lotus fit in this. My guess is that prices will fall more than Morgan. Either way, talking up resale prices or talking them down will not really affect the market
Edited by bordseye on Wednesday 22 April 09:02
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