Who’d be a car dealer in a property bust?

AHG warns big time:

Yuk:

Plenty more where that came from. Yuk:

Comments

  1. If you apply Perth property logic to that chart you can assume a rapid return to capital growth any minute now. Simples!

    • Not if you’re repairing Euro Trash, the repair bill will be higher than the value of the turd. Not worth repairing.

      • 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.

      • 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.

    • 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.

  2. “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”

    • 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

      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?

    • Wino ShinyfaceMEMBER

      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

      • Wino ShinyfaceMEMBER

        Earlwood is practically the eastern suburbs for these fellas – try Yagoona, Moorebank, Fairfield, bro-man-bro

      • @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.

      • Wino ShinyfaceMEMBER

        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

      • 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

      • 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.

      • @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.

      • @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! ๐Ÿ˜€

      • 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.

    • 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.

      • 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.

  3. 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

  4. TheRedEconomistMEMBER

    The dealerships are pretty much a property play.. How much is Auto-alley worth in Parramatta to developers?

  5. Jumping jack flash

    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.

  6. 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.

    • 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!

      • 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.

      • I would love a Jimi but 6โ€™4 and 115kg no no. Pity they go anywhere and of the dont two can pushed em out of trouble

      • 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..

    • 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