ASH8

http://www.goauto.com.au/mellor/mell...2574CC0019C072

“The year 2008 started in the first half full of promise, and then on the 30th of June the tap was just turned off,” said Mr Dickson

“In fact, the August downturn was probably the worst I’ve seen in my 30 years in the industry,” he said.

ASH8

Mazda Australia's greedy little mitts have finally bitten them where it hurts...

erx8s

This situation can be summed up in one word .........gaspocalypse ..........


Cheers
Michael

Revolver

On my reading of that article it sounds like an industry-wide problem and Dickson is just the one being interviewed about it. Maybe other brand chiefs weren't prepared to be so open about it.

He does look like a brickie in a suit though, doesn't he?...

auzoom

I can just about guarantee you that most cars are bought on credit. Credit is increasingly hard to come buy and so is affordability of credit, ie less disposable income and increasing interest rates. I thought it was pretty simple math! And yes, even simpler with Mazda's prices

mdr

New car sales are down although not as bad as people believe.
I have a friend in the business and even though the new sales are off the used market it up.

But hey any blind Freddy could have seen it coming. It takes about 6 to 12 months for movement of interest rates by the RBA to filter through the economy, so it will take the same amount of time before the reductions start being felt also.

But not to worry everyone.
Kevin is in New York and is going to straighten out the worlds economic crisis.

ASH8

I have noticed for months the 2 Mazda Dealerships I pass almost daily have had the same models there for weeks, RX-8's for now almost 2 months.
I say sales have almost stalled, I feel sorry for a brand New Mazda Dealer in a Purpose Built Showroom has just opened in Reynella (Reynella Mazda), my guess at least $1.2 mil spent by the owners (Southgate Holden).

But yeah, Symbolic Kev will fix it .............NOT!

erx8s

The western worlds credit binge of the last 15 years is well and truly over , most people will be spending the next 15 years paying of the debts they have incurred , and hoping that their assets that the Banks own ( Homes etc ) go up in value and they can keep up with their interest payments .

Cheers
Michael

mdr

I keep saying that also, but then I turn the TV on and see ads from places like Harvey Norman and Super Amart for 5 years no interest, no payments.

I asked my wife the other day who buys like that?
The stuff is worn out before you start paying for it.

erx8s

Monty

As they say theres allways new punters , on the Today program they showed how easy it was for a 26 year old girl on a salary of just $ 40.000 per annum to rake up loans of $238,000 .

House loan $200,000 , car loan $ 20,000 + various credit cards of $18,000 to buy whitegoods furniture clothes etc .

THEY WORKED IT OUT THAT BASED ON HER SALARY AFTER THE INTEREST PAYMENTS she would be left with $92.00 per week to live off .

Most likely a person would have to declare bankrupcy within a few months of getting those loans , she could only cope if she had a Sugar daddy

With our money lending system even the poor can appear to be well off

PS : I have 2 blocks next to each other for sale in Cloverhill going cheap if you know of any punters let me know .

Cheers
Michael

Revolver

So Ash, might be a good time to finally twist your dealer's arm and buy yourself an RX8...

mysql

Congress is scrambling to pass the Pentagon budget, aid for flood and hurricane victims and $25 billion in loans for Detroit automakers in a late-session burst of activity that's flying under the radar compared with efforts to bail out Wall Street.

mdr

PM me the info on your lots, might be some interest if the price is right.

erx8s

Monty

PM :Sent but i though no one had any more money left in America

Cheers
Michael

ASH8

Yep Dave, got to make the move soon, the way our dollar has gone, who can guess what is going to happen...

BTW Reynella Mazda costs $6.5 Mil to build!

http://www.reynellamazda.com.au/

ASH8

GM Trading at a 58 Year low..

Was valued at 50 Bil ...now $2.6 bil

erx8s

Worldwide all industries are going through a culling period those that can quickly adapt to current and forthcoming conditions may survive to flourish in the future others will be just left as mear memories of the past .

The overvalued dinasours in the car industry who are still building total irrelevant cars for the future will perish .

My advise is make sure you have at least these 3 things for the next few years .

erx8s

Some interesting reading for you .

http://jalopnik.com/5061552/gm-will-...or-the-general

I'm not the first person to say it. After yesterday's 31% drop in the price per share, news outlets talking to the right people this morning are already saying it, albeit fecklessly, like thus: "Will GM declare bankruptcy?" All I'm doing is removing the question mark. The pundits saying "bankruptcy is not an option" are completely ignorant of the facts, living in an alternate reality or parroting the GM PR public line (a line I don't begrudge GM for pushing given the need to be positive or else face a rush for the hills), because let's be clear here — if the marketplace for credit does not change in the next year, bankruptcy is not only an option, it's the only option. Yes, GM will be forced to declare bankruptcy. Although yesterday's drop in share price had more to do with the release of the short-selling ban on GM stock than anything else, it's indicative of the bigger picture. It's the same one facing every major company in the United States today, and every consumer looking to buy a house or a car — an inability to get a loan. For GM, those loans are what they'll need to go about doing business on a day-to-day basis and it's a problem that looks to not be fixing itself anytime soon. But the "b-word" may not be a curse word for the General. In fact, it could potentially be one of the best things to happen to the automaker in years. Here's why and how.

For the first time in the history of the company, the crisis isn't product. It's clear GM's figured out the need to design and build high quality, fuel efficient and attractively-designed vehicles. Not only have they realized the need to do it, they're actually doing it. Even the most jaded auto enthusiasts, journalists and industry analysts with even the slightest clue have to admit they've stepped up their game in the past few years. But, that won't stop bankruptcy at GM — just like it isn't stopping bankruptcy at their dealerships, as the recent failure of Bill Heard Chevrolet showed us last month.

Although the automaker has the cash to go about doing business right now, we've been told in the past the company needs $11 billion in working capital on hand at all times to remain in business. Right now, they've apparently got somewhere around $20 billion. With a "burn rate" (god, we SO didn't miss that term from the dot-com bubble) averaging over $1 billion a month (and a greater spend in recent months thanks to increasingly lower auto sales) and an inability to raise more cash (other than whatever minor deals they can come up with like refinancing buildings like their Renaissance Center HQ in downtown Detroit), the automaker will hit that $11 billion mark pretty darn quick. When that happens, there's no more crazy deals they'll be able to come up with to avoid declaring bankruptcy.

What's that you ask — what about the $25 billion in Federal loan guarantees? GM's cut of that pie will give them a few billion, yes, but nobody's expecting that money to hit the General's accounts until sometime next year and anyway, they may not even make it that far.

What about the open markets? Well, S&P just made it much more difficult yesterday, claiming it was reviewing GM for further long-term credit downgrades — ratings that already indicate their bonds are below investment grade. So don't expect help to come from the capitalist-loving marketplace.

So what happens when they hit that wall and actually have to throw down the B-word? Nobody knows for sure, and anyone who claims they do is full of more bull than Bank of America after swallowing up Merrill. But, one thing's clear — any form of court-mandated reorganization allows GM to reevaluate all sorts of deals — like the one recently signed with the UAW, with suppliers and most importantly, with creditors seeking repayment on the $43 billion in debt and $80 billion in other liabilities on the books at the General — potentially allowing the automaker to wipe some of that out. More importantly, just like the airlines, it'll give them the time to continue selling their ever-better vehicle lineup. True, many folks may be scared of buying vehicles from a company that's declared bankruptcy but of course, that didn't stop people from piling into Northwest planes after the airline did the same. And that's where they and we, have got some hope.

rotarenvy

this is a similar economic situation that had the rx-7 priced in super-car territory. with the rising yen v's the AUD are we going to see the cost of cars from japan going up?

if Japanese cars do go up it's good news for holden. the V8 versions would be even better placed in terms of price/performance. if only they could trim some lard from them.

mdr

You do know that GM owns Holden don't you?
If GM files bankruptcy Holden will be part of that.
And right now Holden sales are WAY down as all car sales are.

On a bright note I hear car dealers are just about giving them away if you are planning to buy a car you will never be able to drive a harder bargain.

rotarenvy

yeah but how connected are they? it would mean gm sells off holden however holdens are desirable in many countries unlike the US GM cars. with the low AUD holden would also have an export advantage.

mdr

Maybe, but Holden had losses of $146 million and $145 million in 2006 and 2005 they turned some of that around in 2007 but 2008 is looking like a total disaster.

So not sure they could survive with out GM and since it does not look good for GM they can only hope Toyota buys the whole lot on a fire sale.

ASH8

Not sure Toyota would even want ANY US car maker...

The world is and will change a lot more yet..

There are too many production plants in US and Europe, 30% have to go.

As we know GM, Ford and Chrysler have been hemorrhaging for years...and there is no more Credit.