599/430 Prices Crashing

Seriously now.... we have a very diverse group here, with individuals who have made money in every aspect of business....from the stock broker to the local business owner... Yes, there are certain careers which are taking a bath with the current economy, and "plumber Joe" is probably feeling a little pain, but with oil dropping, it is easing the financial burden.... But I think the economy only affects a small portion of us. Personally, the drop in a 401k which isn't getting cashed out for another 20yrs isn't a factor....so why the gloom outlook?

 

Only 178 miles??? Why is he selling?? Do you know what he set the reserve at?

 

Gee...I seem to recall a few months ago being 'yelled' at for pointing out how destructive the Ferrari dealer policies were. I will try not to feel too smug . Seriously, the abuse of the enthusiast by the dealer network has hollowed out the enthusiasm for the brand. The sense of superiority that they try to lord over people who simply wanted a car is astounding. In the words of the good reverend...'the chickens are coming home...to ROOST!'. Seems Ferrari has to self-immolate every two decades. They never learn. I 'bought' it during the 90's...won't do so again. A sad reality behind the shiny, pretty metal. Rather like a super model on meth.

 

I don't think the current consumer malaise has much to do with actual financial position but much more to do with the psychology of being bombarded with bad news in the media every day. Even people who really have no financial worries are thinking carefully about committing to extravagant purchases. I know this first hand from the people I associate with every day. Scottsdale Fashion Square landlord Macerich/Westcor is actively cutting rent reduction deals with their tenants due to foot traffic in the mall being at its lowest levels in a dozen years. That mall is populated by Nordstrom, Gucci, Louis Vuitton, Hugo Boss and literally dozens of upscale stores, all of whom are recording record low daily revenues. Their customer base is hardly suffering financially to the point where they are not able to shop - they are simply choosing to scale back their spending. Ferraris and other high priced automobiles are even more likely to be excluded from current spending plans until the economic news settles down to some consistent pattern.

 

you can tell that to the rash of executives who have received huge margin calls and were liquidated out at or near the lows. google aubrey mcclendon of Chesapeake energy. a ton of wealth has evaporated. toys are the first to go.

 

The hedge fund guys and several CEOS who were fiddling with their portfolios as collateral have been wiped out but the average residents of Scottsdale and Paradise Valley in AZ (and likely any affluent areas in any city in the USA) are simply watching the circus from the bleachers unaffected by the financial debacle that has ensued since the sub prime crisis started. When I last looked 93% of people willing to work were still employed.

 

Ferrari dealer policies are a fair target for criticism, but I think the drying up of the modern Ferrari market has everything to do with the very sick housing market, business forecast and Wall Street. I can't think of a worse time to spend $180K on a depreciating toy like a 430/599.

I think this is partially true, and I probably fit into the group you describe. I'm still busy, and having a good year in terms of income, but I'm not out cruising looking for stuff to spend money on. And as far as cars go, I had a couple on my want list but that can wait and I plan to just stick with what I've got right now. I'm not panicked, but it seems wiser just to be more conservative in my spending habits just now. If a lot of people think that way...

The round the clock doom and gloom on CNN, CNBC, etc., could be a self-fulfilling prophecy.

 

The staple economic phrase that savings equals investment is more likely to be true here for people with resources. The money saved by not consuming is available to be invested in relatively discounted investments, whether they are stocks, land, foreclosed homes etc, and that kind of capital being put into the markets will ultimately be the economy's salvation. Real capital being put to work is precisely what has been lacking for the last dozen years where debt has been the primary investment instrument.

 

Exactly my point...its the PERCEPTION of the economy which is hurting luxury item sales, not that people can't afford it. With all the talk of pricing falling, yeah, why not hold out on that luxury auto purchase...just to see how low it will go... but everything has a floor, and just because one or two people fall under hard economic times and let an auto go for less then market value, it doesn't set the market value. Of course these autos will depreciate, the 430/599 market was flat for depreciation for years, and now its catching up with the drastic decline, but it will flatten out again. Don't think that the current downhill slide will continue!

As an owner myself....would I sell my car? Yeah, if the price was right, I would like to be more liquid given the economic situations...but not because I'm worried about my own financial status, but rather to be liquid for the next deal (like a 170k 430 spider!) but since I can't get a good price selling, I might as well hold onto it for another couple years. The cost of ownership for year 2009/2010 will be very low....

 

Nice Vette! I'll wait until February and offer him 35K!

 

The question is not whether it will continue, it's where it flattens out. And I suspect that it will be low and arrive relatively quickly.

 

I know what it was. A custom golf cart.

 

I've noticed over the last few introductions that the clamoring for the latest/greatest actually buoys and causes a boost in the prices of the out going model for a while. It happened with F355s when new 360s were selling for huge premiums and it happened with 360s when the F430 first came out. I guess that will all come down to how "hot" the 450 is and the premiums (if any) it will see.

 

Right around same for that car w/those options. Looks like a fun one.

 

No cheap credit fueling the FNA hurdey-girdey this time round.
Things are going to be a bit different I'd wager.
In the other thread we have folks who expect to own and drive new model Ferraris for nothing. Break even over 5 years or more can't happen without someone paying the price eventually.
Makes for a particularly nasty game of pass the parcel playing with money they can't afford to lose.

 

As always, some cars are "worth" restoring, and others not. The Vette looks like a fun car, though.

Separately, cloned musclecars aren't seeing much in the way of ROI, these days. Though the real deal '74 SD 'Bird brought 70K - decent $ in any year on that one - and on a Thursday, no less. Be curious to see how stuff does Saturday eve.

 

I generally agree. What I have seen, though, are guys who were in these cars because it looked cool, not because they cared about the marque at all. Lots of them were keeping the wait lists long for the guys like yourself who buy it for what it is, not what it represents to the outside world. Lots of them seem to have been flushed out, especially in this real estate market we have down here. The one guy I'm specifically thinking of does drive a Corvette these days (had a Grigio Silverstone 360 Spider).

RMX

 

Rare cars however have a smaller universe of players who are largely unaffected by the economy. I'm talking here of well established old money, entrenched income, collectors who continue to seek out the special one of a kind car they need to fill a particular gap in their collection. Prices in that arena are strong are haven't faced anything like the kind of downward pressure on modern cars.

Rare cars still live in the same market place. I bought my Lusso in 1983 for $23,000 Sold it in 1987 for $189,000 before the stock market crash. The car sold several times later in 1991 for $89,000 then in 1993 for $110,000. Value of the car 6 months ago was probably $450,000 and I would say in 8 months you will be able to get one for $250,000. Rare cars still have to find buyers and the buyers may sit on thier hands for 5 years like they did in the early 90's.

This world economic situation is very serious. I have been warning and preparing for it for the last 2 years. What is going to happen in the next 2-4 years is going to make the 87 stock market crash look tame and the 87 crash took car values down for 10 years.

People make a lot less than you think and many of the "Wealthy" do not have a lot of cash many are highly leveraged or own assets that are about to crash like commercial real estate.

 

LOL...Hope and Change....lets hope we have some change left after these nimrods get thru with our country..........

 

Off topic, but I was hoping for a 470, makes sense if you think about it... the new Maser engines are 4.7 right?

Oh well, if JG says it will be 450, then 450 it is.

How about some more of that insider information, Jim?

 

wow. such doom and gloom.


before all this happened, i had been planning on buying an early murcielago, because its pretty much my dream car. i am relatively young (low 30's) and planned to pull the trigger before the year is up. i'm pretty much going to finance the bulk of it.


yup, call me dumb and i probably won't argue with you. but i'm probably gonna do it anways.