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What / Who will collapse first in 2019

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38 minutes ago, Errol said:

I don't really see how it is even possible to run a loss of £3.4bn. It shouldn't be possible. How can the business even be viable? Is it even a business?

Probably as a result of your business model hinging on selling expensive, non-essential "lifestyle" products into a saturated market that, in a time of impending economic doom relies solely on disposible income and debt-fuell frivilous spending to sustain it.

IIRC in recent years Jaguar / JLR have rarely been profitable and get passed from one loss-making owner to the next in the vain hope that the company can be turned around, or that its "prestige" image will enhance the perceived value of the owner's other brands. Evidently neither ever works.

IMO the company is one of the few remaining relics of an otherwise long-dead domestically-spawned motor industry. The writing was probably on the wall in the late '60s when they merged with BMC; after which point they've passed through a succession of owners.

 

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3 hours ago, Errol said:

I don't really see how it is even possible to run a loss of £3.4bn. It shouldn't be possible. How can the business even be viable? Is it even a business?

Reading the article it looks like they *only* lost £273 million this quarter, The other £3.1bn was an accounting loss rather than cash out of the door. 

But that's still a billion pounds a year loss, for a car company. When did 1 billion become so insignificant.

 

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11 hours ago, Council estate capitalist said:

Reading the article it looks like they *only* lost £273 million this quarter, The other £3.1bn was an accounting loss rather than cash out of the door. 

But that's still a billion pounds a year loss, for a car company. When did 1 billion become so insignificant.

 

GM Europe has lost ~$1 billion/yr every year for as long as anyone can remember.

https://qz.com/914573/after-losing-20-billion-over-17-years-general-motors-gm-may-quit-europe-by-selling-opel-and-vauxhall-to-peugeot/

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Reading Uni making a charge. Nice bit of creative accounting here: 

https://www.theguardian.com/education/2019/feb/09/reading-university-in-crisis-amid-questions-over-121m-land-sales

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4 hours ago, Quicken said:

Very creative, so I wonder how many other uni's do similar things to jazz up the numbers. We'll soon be seeing desperate uni's doing sale and leaseback etc to ease cashflow, if they aren't already doing this.

The Ofs have said they won't bail out uni's but last year loaned one 900k because they couldn't get through summer. Very troubling times ahead.

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9 hours ago, Quicken said:

Very interesting, but could a university totally go bankrupt?

 

Personally I doubt it, however reckless the university employees are it will get some sort of bail out or forced merger with another university.  

 

In some ways the suprising thing is that universities aren't more reckless.

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Quote

Very interesting, but could a university totally go bankrupt?

Yes, of course. and then start operating again 24h later as if nothing had happened.

It's only numbers on a screen.

Are you not going to go to Reading University because they have 0 debt? 

Edited by Giraffe

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1 hour ago, LetsBuild said:

Bloody Brexit

Federal Government shut down, history shows this is mostly lost spending rather than deferred when staff eventually get back pay as they tend to save it instead.

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33 minutes ago, koala_bear said:

Federal Government shut down, history shows this is mostly lost spending rather than deferred when staff eventually get back pay as they tend to save it instead.

Yes save it for the next Trump hissy fit

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4 hours ago, koala_bear said:

Or their next tax return! Lots of middle America paying far more than expected!

Yes I noticed that. They’re all whinging about having to pay out instead of getting tax back :D  Suckers

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To be fair, the A380 was a dumb idea from the start. It was just a question of when it went under, not if.

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1 hour ago, ftb_fml said:

Wow - didn't expect that although I suppose it's hardly surprising given the general state of things..

Not saying I was expecting this either but doing a bit of digging - It's old.  Its had a good run.  Its a success story really - over 3 million cars made.

"Triumph Acclaim: the first collaboration between BL cars and Honda in the early 80s heralded a new era for car production in Swindon, the
success of which directly influenced the Japanese car giant's decision to build a factory here in 1985"

https://www.pcubed.com/bulletins/lifecycle-manufacturing-plant-birth-old-age

"Renewal and Death: Accepting the Inevitable
 As in life, there reaches a point in every business and factory where the original going concern is no longer justified. There are very few high-performing plants that remain from 1980s boom."

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This is an interesting flip side to all these trade deals we will be doing in future. As i understand it the EU have recently removed tariffs on goods coming in from Japan. This removed a large incentive for Honda to base in the UK (or the EU). The more international trade deals we sign as Brexit evolves (or if we stay in the EU or the CU, that the EU sign) the more chance there is of this kind of activity increasing.

In a tariff free environment I only see two costs that will impact a companies decision where to manufacture their goods, the cost of shipping, and the relative cost vs quality of producing in low wage environments like Romania or Brazil (like Renault for example)

Actually i can see a third reason. The Govt just made it very clear how much cash they were willing to bung Nissan not to shut their warehouse. they've set a dangerous precedent there

Its not just cars, there are many other Japanese industries producing goods in the UK. I live a mile from a Mitsubishi factory producing Air Con units in Livingston. I'd imagine shipping those nice, small, boxy units its cheaper and easier and cheaper than shipping cars.

Edited by regprentice

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25 minutes ago, regprentice said:

This is an interesting flip side to all these trade deals we will be doing in future. As i understand it the EU have recently removed tariffs on goods coming in from Japan. This removed a large incentive for Honda to base in the UK (or the EU). The more international trade deals we sign as Brexit evolves (or if we stay in the EU or the CU, that the EU sign) the more chance there is of this kind of activity increasing.

In a tariff free environment I only see two costs that will impact a companies decision where to manufacture their goods, the cost of shipping, and the relative cost vs quality of producing in low wage environments like Romania or Brazil (like Renault for example)

Actually i can see a third reason. The Govt just made it very clear how much cash they were willing to bung Nissan not to shut their warehouse. they've set a dangerous precedent there

Its not just cars, there are many other Japanese industries producing goods in the UK. I live a mile from a Mitsubishi factory producing Air Con units in Livingston. I'd imagine shipping those nice, small, boxy units its cheaper and easier and cheaper than shipping cars.

its happening in a lot of industries. I know of a large company which shut its UK manufacturing two years ago and relocated a lot of it to Romania and Brazil. the quality has gone down and we end up with a lot of rework but it is still cheaper for the manufacturer to do this. A race to the bottom and I am not sure how this will be stopped

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13 hours ago, hotblack42 said:

Not saying I was expecting this either but doing a bit of digging - It's old.  Its had a good run.  Its a success story really - over 3 million cars made.

"Triumph Acclaim: the first collaboration between BL cars and Honda in the early 80s heralded a new era for car production in Swindon, the
success of which directly influenced the Japanese car giant's decision to build a factory here in 1985"

https://www.pcubed.com/bulletins/lifecycle-manufacturing-plant-birth-old-age

"Renewal and Death: Accepting the Inevitable
 As in life, there reaches a point in every business and factory where the original going concern is no longer justified. There are very few high-performing plants that remain from 1980s boom."

It was built to allow them to access the EU market without having to pay tariffs.

The new trade deal between the EU and Japan will remove those tariffs so the reason for the plants existence has gone. We can expect all of the other Japanese assembly plants in the UK to be closed over the next few years.

I love the local MPs insistence that this was nothing to do with Brexit. Well nothing apart from Brexit removing the UK's say/veto over the terms of the EU trade deal.   

   

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