Share on Facebook Share on Twitter Share on Reddit + - Who’d be a car dealer in a property bust? By Houses and Holes in Australian Economy, Australian Sharesat 12:30 pm on February 15, 2019 | 71 comments AHG warns big time: Yuk: Plenty more where that came from. Yuk: Share on Facebook Share on Twitter Share on Reddit + - YOU MAY ALSO BE INTERESTED INMacro Afternoon A mixed session to start the week here inDr Cameron Murray busts economic ageing myths Last month, the Sustainable Australia partyASX surges on Coalition victoryThere's nothing like a pro-business government toScoMo means less fiscal, more RBAVia Damien Boey at Credit Suisse: Against Comments GeordieMEMBER February 15, 2019 at 12:34 pm If you apply Perth property logic to that chart you can assume a rapid return to capital growth any minute now. Simples! proofreadersMEMBER February 15, 2019 at 12:42 pm Maybe, AHG could do worse than enlisting the assistance of REIWA to the cause of positive thinking? GeordieMEMBER February 15, 2019 at 12:49 pm Rate cuts imminent. Government to waive stamp duty on vehicle transactions. More immigrants require more cars. Lack of local manufacturing means less supply! Turn around in sales near certain. Cars double in value every seven years! Never been a better time to buy!! Your house IS an ATM; leverage that equity!!!!! Borrow now! Buy now! Do not delay! truthisfashionable February 15, 2019 at 1:09 pm -Cash for clunkers! -First car buyers assistance scheme -Free rego to improve private company toll revenue (oh wait, good work NSW) Jumping jack flash February 15, 2019 at 1:21 pm Lol! Hilarious! BubbleyMEMBER February 15, 2019 at 2:01 pm AfterPay! HadronCollision February 15, 2019 at 3:26 pm At TIF free rego only if you live in the city so regional folks subsidising [email protected] February 15, 2019 at 4:11 pm sign up a facilitator https://www.smh.com.au/national/nsw/the-facilitator-how-a-dirty-accountant-washed-millions-for-crime-ring-20180907-p502ex.html doctorX February 15, 2019 at 12:37 pm being a car mechanic in a downturn is gold AndrewMEMBER February 15, 2019 at 1:31 pm Except that no one will have disposable income to pay the bill. GavinMEMBER February 15, 2019 at 1:39 pm Not if you’re repairing Euro Trash, the repair bill will be higher than the value of the turd. Not worth repairing. BubbleyMEMBER February 15, 2019 at 2:03 pm Not with modern cars. Its plug and replace now, no labour hours involved. afundMEMBER February 15, 2019 at 2:28 pm except with my ford focus 2012, they tried to charge me $1200 to repair a faulty exhaust sensor until I found out they didn’t know how to fault find with the OBD2 tool. It they did know it would have been $200 maybe. I paid them $300, but lost my car for a week, so I was well out of pocket, and very angry. The secretary called me and told me the maint manager didn’t know, and I told her that was odd as he was the one I negotiated down to $300. This lot are scum and I now go to a Bridgestone place and they are spot on. BubbleyMEMBER February 15, 2019 at 2:48 pm Ergh, what a pain. There was a recent article in the news about mechanics complaining about how mechanics plug and replace policy was hurting their pockets. fisho February 15, 2019 at 2:27 pm It’ll be interesting to see people with BMW and Merc’s going to their local garage only to discover that the garage can’t read the Fault codes because the diagnostic systems aren’t really OBD2 compatible. Even where the Fault reporting is OBD2 compatible there are often restrictions preventing the replacement of components without updating the list of installed components. And guess what Only an authorized dealer can change these installed feature authorization lists, for BMW’s newer than 2012 (I believe in Australia) the associated install files are also encrypted. welcome to the new world where the hardware (car you purchased) is practically worthless without the ongoing software support provided by the Dealer. BTW no prizes for guessing what happens to service costs when the dealer suffers reduced new car sales…. I imagine this will come as a shock to a lot of people that try to reducing their car operating costs by cutting the dealer out of the loop and using a local mechanic for ongoing service. Joe February 15, 2019 at 2:48 pm Not just the software. The parts are chipped/encrypted too so no after market spares possible. After I got fucked by Mercedes dealer for a new fuel pump I ditched the car. Took a hit. Bought a Honda. Not one issue in 6 years – apart from air bag replacement- covered by dealer. Will never buy euro trash again. Can’t wait for competitively priced electric cars to hit marketplace. Very very few moving parts. Once the range hits 400km with Quick charge batteries I am in. JohnR February 15, 2019 at 3:11 pm https://www.perthnow.com.au/news/australia/government-considers-information-sharing-to-lower-costs-of-car-servicing-ng-b881102969z [email protected] February 15, 2019 at 4:00 pm go long aftermarket pcm installers [email protected] February 15, 2019 at 4:18 pm frinstance https://www.motec.com.au/targeted-current/targeted-vehicle-current-index/ GavinMEMBER February 15, 2019 at 4:42 pm It’s a total joke, I’m sure someone will jail break the software to make it possible to circumvent this nonsense. fisho February 15, 2019 at 6:40 pm Yeah Joe, that’s exactly what I’m talking about, all sorts of parts have part ID’s associated with them and the car throws up codes and goes into limp mode or refuse to work at all when all you did is to add or remove/replace a factory part. Even parts that are intended for that car such as wrecker parts have different ID numbers to the installed part so you can completely fix the broken part (mechanically) only to find that the car won’t start because some hidden feature list needs to be updated…..a lot of people are in for a lot of surprises especially if they buy these as used cars and think they can fix/ repair the car themselves. GrahamMEMBER February 15, 2019 at 11:25 pm fisho – thanks for the warning – very much appreciated. I’ve got to get out of this Euro trash. GGMEMBER February 15, 2019 at 12:43 pm “A number of acquisitions and investment decisions made in the last decade reflected where the market was at the time” In other words, “we rode the property bubble for all it was worth, our CEO and senior leadership got paid heaps, we we gave finance to anyone and everyone to buy a new car, but nobody could have anticipated what has since happened” Know IdeaMEMBER February 15, 2019 at 12:46 pm That is why they are paid the big bucks. doctorX February 15, 2019 at 12:51 pm they paid over $2 per share in dividends since 2005 so shareholders made plenty of money (imagine all those sweet BBs franking rebates) Jumping jack flash February 15, 2019 at 1:23 pm Its amazing what happens when you shift your entire economy to be completely dependent on credit and credit growth, and then grow credit! Truly amazing, who would have thought? DanMEMBER February 15, 2019 at 12:50 pm And who’d be in car finance? Latest from Moody’s: https://i.imgur.com/rL5hve7.jpg https://i.imgur.com/jUc5mvj.jpg Wino ShinyfaceMEMBER February 15, 2019 at 12:57 pm probably much more to come, so many construction spivs getting about in lambos and Ferraris in western Sydney, Gucci bum bags full of cash, shaved arms, legs and head….lol GeordieMEMBER February 15, 2019 at 1:01 pm We all know how well that worked out in Perth – home of Australia’s best drivers. http://www.randomperth.com/2012/01/turn-back-time-embarrassed-ferrari.html C.M.BurnsMEMBER February 15, 2019 at 1:26 pm have you been stalking my suburb (Earlwood) mate ? Wino ShinyfaceMEMBER February 15, 2019 at 1:40 pm Earlwood is practically the eastern suburbs for these fellas – try Yagoona, Moorebank, Fairfield, bro-man-bro GavinMEMBER February 15, 2019 at 1:42 pm @Wino – so true. The number of “APES” I’ve seen driving hot exotics around. More body hair, than hair on their heads. All ego and no class. I reckon i’ll pick up a cheap 1 or 2 when the downturn hits a record low. C.M.BurnsMEMBER February 15, 2019 at 1:47 pm gawd. what forces you to spend any time out that way ? Wino ShinyfaceMEMBER February 15, 2019 at 2:07 pm work….and i’m not looking forward to how violent the area is going to become if the shtf in a big way, already getting tail gated by the wives of the bro-man-bro’s in black V8 landcruisers through shopping centre car parks now…bro AndrewMEMBER February 15, 2019 at 2:21 pm Gavin, parts to fix old cars are getting real cheap in Perth and Adelaide. Even with freight it is far better than dealing with a fair number of Melbourne “car people”. I’m tipping old classics are going to nosedive as every single car person i deal with now talks only about how much their car will be worth one day. It will have rusted out by then, but BOOM times ahead always LSWCHPMEMBER February 15, 2019 at 2:30 pm Never understood the whole super close cropped hair and beard thing among a lot of middle-eastern chaps. Seems incredibly vain and gay to me, NTTAWWT. fisho February 15, 2019 at 3:00 pm @Gavin If you think these guys are bad drivers on the streets you aught to meet them on the race track…F-me-sideways they are unbelievably bad, I’ve been lapping 10 seconds per lap faster than these a-holes yet they’ll grab the racing line and than be getting sideways in the corners like we’re in some sort of drift session. When you have that great a speed differential especially through the corners it’s F’ing dangerous to not hold your line. GavinMEMBER February 15, 2019 at 4:45 pm @Fisho – I know exactly the type of driver you’re talking about. They have no clue that the smoother you are and more finesse the faster you go, they think rapid movement and sliding will get them there quicker and they will block you passing them, since that to them is racing. I’ve encountered these guys on Go-Kart tracks also, a well applied and timed nudge into a tyre wall usually works quite well. Good thing Go-Karts are so noisy, or they would hear me laughing my arse off half way around the track! 😀 haroldusMEMBER February 15, 2019 at 5:24 pm Shaved head, has beard. fisho February 15, 2019 at 5:57 pm Yeah it takes a while to learn that your exit speed from a corner is far more important parameter than your entrance speed into the corner. You’ll hear these guys talk about how they were braking really late or not braking at all and watch them scrub 20km/h off their speed by being untidy in the corner, I’ve even tried to explain why I’m so much faster but they don’t want to be told they’re the problem for these guys spinning and sliding tires = going super fast Personally I’m all about keeping it super tidy with consistent lines and highly predictable lap times. BubbleyMEMBER February 15, 2019 at 2:17 pm The Royal Commission may have had a knock on effect for car dealers. The important bit is below. https://www.abc.net.au/news/2019-02-15/retailers-surprised-to-be-caught-in-hayne-recommendations/10804128 “Car dealers and shop assistants can currently offer loans or credit cards and help customers fill out the forms without holding a credit licence. The ‘point-of-sale exemption’ contained in the National Consumer Credit Protection Act means a dealership or retailer does not need to hold a credit licence or comply with responsible lending obligations. DanMEMBER February 15, 2019 at 3:21 pm There has been some crazy stuff going on such as dealers getting paid \incentives to put people on higher interest rates. I don’t recall much Hayne testimony on this. SoMPLSBoyMEMBER February 15, 2019 at 12:54 pm Oh Geez! No chance now of getting the dealers to knock a $100 off that Tru- Kote paint protector! https://www.youtube.com/watch?v=B2LLB9CGfLs C.M.BurnsMEMBER February 15, 2019 at 1:25 pm since their “skills” (applied loosely and generously) are transferable, I’m sure that all these excellent and upstanding car salespeople will make fine real estate agents. I hear there’s never been a better time to become an RE Agent TheRedEconomistMEMBER February 15, 2019 at 1:27 pm The dealerships are pretty much a property play.. How much is Auto-alley worth in Parramatta to developers? C.M.BurnsMEMBER February 15, 2019 at 1:47 pm same as Harvey Norman Jumping jack flash February 15, 2019 at 1:41 pm I was unlucky enough to need to sell a couple of cars 6 months ago. It was tough. Nobody has any money and nobody wants more debt. Its good to see people not wanting debt, but nobody has any savings either so that’s a real problem. GavinMEMBER February 15, 2019 at 1:45 pm There is a specific car I want and there is 4 of them on the market right now. Haven’t moved. All asking mega bux $$$ https://www.carsales.com.au/cars/details/Nissan-Stagea-1998/SSE-AD-5825171/?Cr=0 https://www.carsales.com.au/cars/details/Nissan-Stagea-1997/SSE-AD-5876346/?Cr=1 https://www.gumtree.com.au/s-ad/aberfoyle-park/cars-vans-utes/nissan-stagea-260rs-autech-version/1208988107 https://www.gumtree.com.au/s-ad/west-lakes-shore/cars-vans-utes/260rs-stagea-rb26-300kw-purely-eoi-for-swaps/1208462046 I think I’ll give it a while longer, then start low balling… Unfortunately these have suffered the GTR tax.. Skyline R32,R33 and R34 GTR’s have all sky rocketed in value as of the last few years and that’s dragged prices of these up with it. I reckon I’d like to pay around $15k for 1. GGMEMBER February 15, 2019 at 1:54 pm These are popular, Gav? When I lived in Tokyo they were driven by newly licenced lads who couldn’t afford a GTR. The after-market mufflers were massive! I had a Legacy GTB turbo wagon. Great car. We had that until the Mrs got sick of the hard suspension. BubbleyMEMBER February 15, 2019 at 2:07 pm $30K for mums taxi? I nearly choked on my chicken curry! GavinMEMBER February 15, 2019 at 2:19 pm @GG – Yeah the RB26 drivetrain drives a lot of the value of these. Nissan still makes parts for Skyline GTRs and recently started to make parts for them again due to the popularity of the platform. @Bubbley – Yeah $30k is crazy price in my humble opinion, but they will become a bit of a collector car I think. I like the “sleeper” concept. https://www.youtube.com/watch?v=EUrfIW4zQmM pingupenguinMEMBER February 15, 2019 at 2:59 pm My word, now THAT is an ugly car. Why is that popular? BubbleyMEMBER February 15, 2019 at 3:12 pm I don’t know about the Stagea Gav, its def a sleeper which I like the idea of but it is still butt ugly. If its going to hold its value long term (10-20 years for the investment hold) I’d be picking something that doesn’t look like mums car with a dodgy body kit chucked on it. But what do I know, even Edsel’s are now worth some serious coin. https://classiccars.com/listings/find/all-years/edsel?p=2&s=price&sa=true (dirty secret – I quite like the Edsel and dont think it deserved the hate it got.) Michael February 15, 2019 at 4:03 pm Why not look at something like a RS6 V10? Couldn’t be that much more surely. Ben February 15, 2019 at 4:13 pm Hey Gavin, I know nothing about autos, As our go-to classic car connoisseur, Do you think the early nineties Ford Capri convertible has any potential ??? drsmithyMEMBER February 15, 2019 at 4:36 pm If anything on your RS6 broke, you’d probably want to be sitting down while your were calling around for prices to fix it. GavinMEMBER February 15, 2019 at 4:37 pm @pingupenguin – because it looks like a Volvo, but is based on the Nissan Skyline GTR drivetrain. https://www.youtube.com/watch?v=HxWjvZ6cR-U @Bubbley – A fair critique, but I always wanted a Nissan Skyline GTR (R34 in particular) and good ones are $100k again (they were when I first wanted 1 in the early 2000s). This is my way of getting a cheap “practical” GTR, that I can have the dog in the back, lug car parts in the boot and still call it a family car. :). RE: Edsel I like it too, you’d like a show on Youtube called Barn Find Hunter.. lots and lots of that era of cars sitting in barns collecting dust. @Michael – I generally do the work on my own cars, modern cars especially Euro’s don’t like to be tampered with. This is not a rational purchase :). @Ben – Not a chance… I personally can’t stand them myself. I can’t see them gaining much value over the next 10 years. Just not on anybody’s radar. I kind of view them as a Nisan Exa. But if you like it and it’s at the right price, don’t let me hold you back? GavinMEMBER February 15, 2019 at 4:49 pm @DrSmithy – that’s my concern. At least buying a popular platform like the Skyline GTR there is huge aftermarket support and spares floating around. This means there is usually a solution to the most common issues and a good fix for it too. For example RB26’s especially early ones are known for oil pump issues. Later oil pumps were better, but there is plenty of aftermarket support for those running 600-700hp – which seems to be the “new” normal these days. https://www.youtube.com/watch?v=8l71RDTrZVA Ben February 15, 2019 at 4:58 pm Thanks Gavin, Good advice, Well given. haroldusMEMBER February 15, 2019 at 5:27 pm Hideously reminiscent of a Walkinshaw commodore (if it came as a wagon in white) GavinMEMBER February 15, 2019 at 5:30 pm @Harry, go on, admit it. You’d rock a Walky 😀 footsore February 15, 2019 at 2:05 pm I’ve a soft spot for Suzuki Jimnys. Being near a dealership a few days ago I dropped in to look at the new version. The dealer only got 6 out of the initial 200 that came to Australia. 5 of those sold sight unseen and price unknown. Only 1100 will arrive this year and all are expected to sell. It’ll be interesting to see if that prediction is correct. GavinMEMBER February 15, 2019 at 2:26 pm I’ve seen a couple in Sydney already, I have Jimny envy as I’m in the older version. Good value for money on a new car. I think they will all sell also. Slow though! footsore February 15, 2019 at 2:31 pm I’ve also got an older one. It’s great. You have to to understand what you are getting otherwise you’ll be frustrated by the lack of space and power. A friend had wanted one for a while and they changed their mind after we went for a long drive. Al February 15, 2019 at 3:18 pm I would love a Jimi but 6’4 and 115kg no no. Pity they go anywhere and of the dont two can pushed em out of trouble GavinMEMBER February 15, 2019 at 4:39 pm I taught the missus to drive manual in it and have used it to ferry the dog around, carry car parts (I got a roof basket) and it’s been super reliable. The only problem is I do a lot of Sydney->Melbourne driving and it’s just not a good car for freeway drives (or long drives in general). Great for their purpose, but I really want more grunt and I need a tow car.. V February 15, 2019 at 3:55 pm Cars are relatively expensive in Australia, why doesn’t the industry lobby for reduced duties and taxes. JonathanMEMBER February 15, 2019 at 4:31 pm tariffs and luxury tax to protect local industry …. what local industry … my understanding was that you could buy a crate v8 from Detroit (the same as a Holden ss) for $6500usd … but to strip money out of holden they charged $25000 therefore Holden ran at a loss and had to get govt grants … once they stopped the money they didn’t want to reduce costs as they would “wreck the value of other cars that GM wanted to sell to Australians” fun times being ripped off [email protected] February 15, 2019 at 7:02 pm yep, sniff around various remanufacturers in the us and pick up a 5.7 gm for 4500bux Lenny Hayes for PMMEMBER February 15, 2019 at 4:54 pm We had this conversation a while back – protecting new car dealers it appears Micko77 February 15, 2019 at 11:24 pm 10% dividend yield though. Are they going to maintain that?