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European Car Industry 'faces Collapse'

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http://www.guardian.co.uk/business/2009/ja...dustry-collapse

Europe's car industry faces collapse without rapid intervention from EU governments, Carlos Ghosn, Renault's chief executive, warned today.

Ghosn, president of the pan-European carmakers' body ACEA, pointed to a "brutal" collapse in sales and squeeze on credit.

His comments, at a Paris summit with French ministers, came as the Sarkozy government prepared to inject capital into both Renault and Peugeot Citroen on top of the €1bn in loan guarantees given to their finance arms.

Separately, BMW, the German premium car group, confirmed that it was considering tapping Berlin's €500bn bank liquidity package for its own finance/leasing arm.

And Fiat said it could take a stake in Chrysler, the most vulnerable of America's Big Three car-makers, via a joint venture to make common models and help the US company adapt to demand for more "green" models. The stake could be as much as 35%.

Sergio Marchionne, Fiat's chief executive, has already indicated there will be only half a dozen global auto-manufacturers left within five years while the French government is talking of six to eight.

Ghosn's intervention is the most dramatic plea from Europe's auto industry for aid to match that given to General Motors and Chrysler, with Ford waiting in the wings.

ACEA wants €40bn in support; the European Investment Bank, the EU's in-house lender, has made €10bn available over the next two years in soft loans, primarily to switch to new, green technologies.

If you have a poor business model then seek a bailout.

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http://www.guardian.co.uk/business/2009/ja...dustry-collapse

If you have a poor business model then seek a bailout.

It amazes me how quickly these businesses seem to fall on hard times! Did'nt they put anything aside for a rainy day when they had ten years of booming sales. :blink:

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Have they considered the possibility of lowering their prices.

I was looking at a car last week in a dealers for 13K. On the radio over the weekend the dealership had an advert stating it had a sale on used cars with up to 2K off the price of all their cars. So I go back and look at the 13K car which now has an advert on it for £14,995 and a big red sticker saying 1K off so it is 14K - 1K more than prior to the sale.

I have come to the conclusion that car dealers and EAs share the same gene pool.

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Have they considered the possibility of lowering their prices.

I was looking at a car last week in a dealers for 13K. On the radio over the weekend the dealership had an advert stating it had a sale on used cars with up to 2K off the price of all their cars. So I go back and look at the 13K car which now has an advert on it for £14,995 and a big red sticker saying 1K off so it is 14K - 1K more than prior to the sale.

I have come to the conclusion that car dealers and EAs share the same gene pool.

I think that's illegal. It certainly would be in a shop (something has to be offered for sale at the 'pre-sale' price for a certain period of time before you can make a claim to money off the 'price').

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It amazes me how quickly these businesses seem to fall on hard times! Did'nt they put anything aside for a rainy day when they had ten years of booming sales. :blink:

My thoughts exactly. It goes to show how the entire economy is run with a narrow short term view with insufficient planning for the future. We had years of regular announcements from the banks of record profits, for example, then a few months of problems and the whole edifice collapses.

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I think that's illegal. It certainly would be in a shop (something has to be offered for sale at the 'pre-sale' price for a certain period of time before you can make a claim to money off the 'price').

I agree. Personally I would contact the local trading standards office to make a complaint.

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It amazes me how quickly these businesses seem to fall on hard times! Did'nt they put anything aside for a rainy day when they had ten years of booming sales. :blink:

Indeed. Saw a graph of profits for Renault (I think) over the last 10 years. Billions made every year.

OK, some needs to be reinvested. However, I get the impression a large chunk of the profits from the car makers get paid out to the shareholders as dividends. Why should the taxpayer put money into these failing businesses. If they were any good, people would buy their shares. Letting them fail would do us all a favour in the longer term.

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LOL - just when I think you lot may actually have a point about house prices, the econony etc (apart from the nutters that are hoarding enough food for the next ten years), then is then a thread about cars and comments from people that know next to F ALL about the industry.

Still, its quite entertaining to read sometimes.

MT - you really should have jumped in and bought that 13k car - then you may be able to get on with your life and not spend your weekends trawling car showrooms!! :rolleyes:

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LOL - just when I think you lot may actually have a point about house prices, the econony etc (apart from the nutters that are hoarding enough food for the next ten years), then is then a thread about cars and comments from people that know next to F ALL about the industry.

Still, its quite entertaining to read sometimes.

MT - you really should have jumped in and bought that 13k car - then you may be able to get on with your life and not spend your weekends trawling car showrooms!! :rolleyes:

OK, wise crack, enlighten us. We are all ears............. B)

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It amazes me how quickly these businesses seem to fall on hard times! Did'nt they put anything aside for a rainy day when they had ten years of booming sales. :blink:

My thoughts exactly. It goes to show how the entire economy is run with a narrow short term view with insufficient planning for the future. We had years of regular announcements from the banks of record profits, for example, then a few months of problems and the whole edifice collapses.

I'm not surprised by this at all. "Putting something aside" is a competitive disadvantage (until you need it!). These companies are operating at the limit, if anyone was to 'back off' by building up a rainy day fund of say 10% annual profits each year this saving would be like a millstone holding back their competitiveness. One company puts cash in a rainy day fund the other company uses the equivalent money to reduce prices or invest in more R&D.

Big organisations operating in competitive environments can't save up stacks of cash. The only big companies that manage it are those not in very completive environments - like Microsoft for example.

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Indeed. Saw a graph of profits for Renault (I think) over the last 10 years. Billions made every year.

OK, some needs to be reinvested. However, I get the impression a large chunk of the profits from the car makers get paid out to the shareholders as dividends. Why should the taxpayer put money into these failing businesses. If they were any good, people would buy their shares. Letting them fail would do us all a favour in the longer term.

Unfortunately, prior to the crunch, you also had Private Equity stalking anyone - absolutely anyone - with a low share price. Cutting dividends so as to build up a cash pile to get through the inevitable recession would quickly mean being bought up and stripped.

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I think that's illegal. It certainly would be in a shop (something has to be offered for sale at the 'pre-sale' price for a certain period of time before you can make a claim to money off the 'price').

I agree but difficult if not impsosible to proove and they probably know it.

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MT - you really should have jumped in and bought that 13k car - then you may be able to get on with your life and not spend your weekends trawling car showrooms!! :rolleyes:

Nah, the same car is about 3K less than the original price with another dealer.

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Unfortunately, prior to the crunch, you also had Private Equity stalking anyone - absolutely anyone - with a low share price. Cutting dividends so as to build up a cash pile to get through the inevitable recession would quickly mean being bought up and stripped.

Yes, but isn't that the free market that all these uber-capitalists love?

Years ago, the French govt used to own the car makers there.

Then, in the 80s they sold some stock and held a majority share.

Recently, they sold even more, and now hold a golden share.

If the French, or any other car making nation, wants to save their industry from these stalkers then the only way seems to be nationalisation? :ph34r:

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One again, the clever, devious and wastes of space in the City and in all bourses throughout the World, precluded the whole concept of saving for future down cycles: any quoted company with sgnificant reserves would instantly become a target for hostile M & A asset strippers: like Hanson and Gordy Brown for example were doing from the time Hanson Trust was started.

They were even raiding pension funds!

Nice scam: find a tame actuary who "certifies" the pension fund of an acquired company is "Over-Funded" and grab (steal) tens of milllions back, pay the corporation tax and hekp pay for the acquisition.

Next the tame actuary, with the asset stripper working his strings, says "Take a pension holiday! No contributions needed for three years!" Or whatever................

Additionally, it became clever to operate most major corporations on higher and higher gearing.

What makes me larf cynically about all this, is that the central mantra of the exponents of the wonders of the Free Market wanted us all to believe the market corrected itself: the strong survived and the weak went to the wall.

Nice theory!

Except when it actually happens, then these free market proponents are the first to scream for government invention and assistance!

Good innit!

Socialise the losses and privatise the profits.

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One again, the clever, devious and wastes of space in the City and in all bourses throughout the World, precluded the whole concept of saving for future down cycles: any quoted company with sgnificant reserves would instantly become a target for hostile M & A asset strippers: like Hanson and Gordy Brown for example were doing from the time Hanson Trust was started.

The paradoxes of the free market.

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Only 6-8 global auto-manufaturers left, a handful of banks, and a couple of currencies, a few food suppliers and pharma cos.

Then what?

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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