Ferrari prices definitely dropping....

It's wore than even I thought!! My wife would give up food first.

 

A good and thoughtful Post. Thanks for making it.

 

well put scotty...

 

They will make the 09s unsellable.

 

Brilliant post Dr.

 

Fenzoman makes a very good case for why he does not have or want a Ferrari. His profile explains as well - owned = n/a, wanted = none

Why he hangs out on a Ferrari site and preaches gloom and doom is unfathomable.

Perhaps it's easier than waiting for celebrities and throwing blood on their fur coats?

Word of the day - Schadenfreude.

 

LMFAO!

 

Spot on Scotty. Thanks for being candid. In my field, commercial real estate and private equity, practically the entire sales market and development business is on hold. Large multi-family and commercial product which were selling a year ago for 5 to 6 caps, aren't moving at 8 caps today. Most institutional lenders like GE and BofA are telling their lending divisions to sit out the next 6 to 9 months before considering a new transaction. Anything even being sniffed at by lenders is being underwritten solely on trailing 12 month history - NO DEALS valued on a pro forma. On the construction side, new construction loans are not easy to come by. We have seen many existing projects put on hold because lenders have said "we don't care that we are in default for failing to provide additional draws; we don't have the liquidity to send out of the coffers because we need what little capital we have to fund exisiting and imminent losses". On the equity side, there is a ton of dry powder sitting on the side lines but they refuse to jump in right now because they are waiting for the big real estate crash to hit - which is anticipated to be 6 to 9 months away. If they sniff a deal right now, it must carry with it a 15 to 18 percent UNLEVERED return - 25 to 30 % LEVERED. Sounds bizarre, but those with cash like our company are keeping it dry for the
time being.

On the retail side, the crickets that Scotty mentioned can also be heard in most shopping malls and strip centers. NO ONE is providing financing for retail centers right now unless it is 50% leverage with absolute winners on the anchors. As for who will survive the retail crunch, look at the list of retailers closing stores by year-end 2008:

Circuit City stores... most recent (? how many ?)
Tweeter (Stereo store) all stores closing
Ann Taylor- 117 stores nationwide
Lane Bryant, Fashion Bug and Catherine's to close 150 stores nationwide
Eddie Bauer to close stores 27 stores and more after January
Cache will close all stores
Talbots closing down all stores
J. Jill closing all stores
GAP closing 85 stores
Footlocker closing 140 stores more to close after January
Wickes Furniture closing down
Levitz closing down remaining stores
Bombay closing remaining stores
Zales closing down 82 stores and 105 after January
Whitehall closing all stores
Piercing Pagoda closing all stores
Disney closing 98 stores and will close more after January
Home Depot closing 15 stores - 1 in NJ ( New Brunswick )
Macys to close 9 stores after January
Linens and Things closing all stores
Movie Galley Closing all stores
Pacific Sunware closing stores
Pep Boys Closing 33 stores
Sprint/ Nextel closing 133 stores
Ethan Allen closing down 12 stores
Wilson Leather closing down all stores
Sharper Image closing down all stores
K B Toys closing 356 stores

Lowes, Dillards and JC Penneys to close down some stores

We use many of the larger law firms to handle our legal affairs. Most are making 15% to 25% employee cuts because billings are significantly down. Most real estate and finance departments are hearing those crickets - no transactions equals no billings. Interestingly, the bankruptcy and litigation segments have not picked up yet as dramatically as one might suuspect, though I am sure that will change in the second half of 2009.

Sad to see this but all bad things will turn around. Don't expect a quick turnaround but one that will take at least 1 year to start the long climb uphill. Tighten the belt boys. We will make it through this! For now, those with powder have the ability to buy some amazing cars at rock bottom prices!

Joe

 

308's selling for $15,000.00? Probably not the good ones...unless you would rather not drive one, but be "taken for a ride."

Scams, thanks to the economy, are bringing out the worst of the worst (of all cars). Make sure a PPI gets done on these deals (rolling wrecks), because the "good deals" probably aren't in these bottom priced cars. Shiney on the outside is well, shiney on the outside. With the economy as it is, this is the best time to unload parts cars as "My baby is reduced due to my need for quick funds" jewels. Buyer Beware.

 

The cars lined up at the port is kind of old news. I live near Brunswick GA and a friend of mine who owns an oval dirt track was contacted by Kia to build a storage facility on his land. He graveled 30 Ac off of Hyway 82 in south Georgia and it is full of Kia's. An amazing sea of cars. The Kai factory's are going full tilt to avoid layoffs and labor unrest. A strike in Korea is kind of like a gang war according to a GM buddy that was involved with Daewoo. The cars are shipped over here to hide them and keep them off the books. Chyrsler did this a couple of years ago and shipped the cars to Canada.

I wonder how Ferrari, Lamborgini and Maserati are planing for the downturn. I would be glad to built them a secret storage facility on my 200 Ac here in South Georgia.

The speed of this down turn is amazing and we have a long way to go down. A good time to keep the powder dry.

 

he wants to be the voice in the wilderness, the saint of 'I have the insight'....

he is the only honest man in search of an honest man

I am not saying his voice hasn't truth, but, he is all about the gloom....his agenda is to beat it to death, until....well, someone puts them selves at his feet and kisses them.

he is a lurker....he says so. How? He offers only what the half empy is, and never anything else. He's a baiter...

back to cooking din....wife in the Mondial and leaving work late...as usual and I have a great din. mmmmmmmmmm

wine open and here we go

 

I have a couple further thoughts.

First: Joe, thanks for you post, always good to have a few more data points.

Second: This is not just a media driven concern--many indicators are negative, and it is hitting broad swaths of America. I spoke to one of the managers at the athletic club I attend. New memberships have almost dried up, and they are loosing existing members at about a 5% higher rate per month than they were 6 months ago.

Third: Fire sale cars, in my opinion, are going to continue to appear because the economic malaise is continuing. Some will be "run hard and put away wet", others will be nice units. The problem is two fold. The first is that a lot of folks with dollars are sitting on the sidelines, and therefore desperation sales will need to be extremely well priced to attract that money. Second, as the occasional good car goes for cheap, it may put downward price pressure on others cars.

 

It's clear that the economy is causing lots of problems for people in general and it is affecting car buyers in specific. Since this is a car sub-forum, I'll focus on just the car market, not the issues of the overall economy. The car buying market is pretty complex, but for purposes of this discussion let's break it down as follows:

* Liquid/Wealthy - still able to buy cars, but perhaps will do so less often just because it is harder to move out the old car in trade (they could accumulate, but there's usually a limit to that) and in any case they may be preoccupied with current financial events

* Not-liquid/Wealthy - not hurting badly, but will probably sit on what they have as they conserve cash and control expenses, may selectively dispose of some assets as opportunities arise, probably even more preoccupied with keeping their businesses/investments stable than the Liquid/Wealthy

* Leveraged/trying-to-appear-wealthy (temporary high cash flow) - this person is in trouble and is probably the prime cause of the tanking market

* Liquid/Not-wealthy - increasing opportunities to buy some nice cars at better prices if they're otherwise financially stable

* Not-liquid/Not-wealthy - no change, just trying to generate more income greater than expenses and keeping sheltered through the storm, not really a segment of the market pre or post.

A drop in resale value of 20%-30%-50% is never welcome, but the owners who are financially stable (various grades of wealthy) will most likely just enjoy what they have for a few miles more. It's sunk cash and not really significant compared to how much their other assets are likely to be down in today's market. Ultimately the disappearance of one segment of the market, the Leveraged, removes a large number of buyers/consumers, which will surely depress market price, which in turn will likely subdue the buying behavior of the other segments.

The previous winners were these folks who got to play market supply games and captured the market premiums between them and the dealers. The second group of winners were the Leveraged who borrowed money to bid the market values up; they drove the cars a bit, got to look good, then turned around and flipped the cars at little/no cost or for modest premiums. The previous losers were enthusiasts, unwilling to borrow big $, who had cars priced out of their means for artificially long periods.

The current winners are now those who maintained their savings and enthusiasm and are now seeing some good deals appear and may see even better deals appear. This applies across the entire food chain of descending model years/price. The current losers are those who borrowed money they didn't have and are now underwater on the car they didn't flip out of in time and may even be under extreme financial pressure in the other parts of their financial lives. The auto manufacturers and dealers are also losers now as they face contracting demand, exacerbated by the likely greater fall from the artificial market levels that they believed they could keep pumped up.

As the market finds new price and volume levels, it's going to be a different group of winners and losers. Hopefully enthusiasts of intermediate means, who will enjoy the car and see it as an expense that they have budgeted to afford, will make out better than in past years. This all assumes the world as we know it doesn't end in 6 months .

 

+ Mervyn's going out of business. Mervyn's!!

Sharper Image has always been ridiculous, and them closing down was a matter of time. They sold standard consumer goods that were a fraction better/faster/sexier than what one could find in a regular department store... and charged 2-5x the price. Who the heck needs the "Ferrari" of can openers? Or the ice chest equivalent of a Lambo? (but all still made in China?) don't get me wrong-- it was fun to browse their store, sit in the massage chair, fiddle with the latest integrated infrared meat temperature sensing bar-b-que utensil... but actually *buy* anything? LOL. nope.

 

I hesitate getting involved in these kind of discussions because they usually just go around and around and around but since you quoted me and followed up with a pretty silly quote I feel I have to respond. Just this once...

If you're talking about a Ferrari with a blown engine, well OK then I suppose it could be worthless, i.e. $0.0. But how 'bout we just talk about your basic, no stories, used Ferrari. My original response was referring specifically to 308s.

Let's say a desperate guy who is totally in over his head and at the end of his rope puts his typical used 308 up for the taking for $0.0. I imagine there would be at least one taker. Count me in, I'll even give the guy some money for his troubles, how about $100? Word gets out this guy is dumping his decent used 308 for $100 and another guy comes in and says, hey, the car looks good, it even has been serviced in the last five years, I give you $1000 for it.

As you can see it's pretty unreasonable to think a typical used 308 will be worth $0.0, even in these hard times.

People please. Times are hard. They will get harder.

But when people post things that are so off the chart and unsupportable it makes those people lose some of their hard earned credibility. When you make a rational, supportable argument, you gain credibility and readers trust what you are saying.

-F

 

Real men have no problem with reality. Those of you desperate enough to want to blame the messenger should stop clicking on these threads. A good discussion on where the market is is wanted by many as the popularity of these threads on an otherwise slow board attests!

And if you read back through my threads, I have some insight as do many others from doctor's to economists. Et tu girls? It may be time to slow down on the wine even though wine prices are plummeting too!

 

You need to cool it. The problem isn't the message, the problem is the perpetual nagging. Whatever merit your argument had is diluted by the repetition and now the name-calling.

 

I found this site several months ago when pointed to it by a dealer who told me his inflated prices would be confirmed by the crowd here. He was right, as prices were falling fast lots here were talking them up. Took some knowledge of the board to understand many were dealers or folks trying to "quietly" dump their cars.

Nagging? Stating me opinions in the context of a thread is nagging? Example please? Let's face the truth, lots of folks bought cars as an investment and desperately want to hold on to that idea and keeping folks quiet is their preferred way as fruitless as it is. Who's going to speak up for those who don't know better?

I'm out, there must be a better place to have a non biased by personal greed discussion about the market. I'll just sit back and watch the market become reowned by enthusiasts.

 

If you bothered to really get to know the board you would find that there are two groups, the folks talking the market up and the folks talking the market down. Apparently you only paid attention to the ones talking the market up.

As far as nagging, a search of your posts shows 170 or so since June, of which, rough guess 150+ have to do with declining prices or soft market.

As far as bias, see the above.

 

Read this thread, came across this on Craigslist-I have no interest here and know nothing about the car but what I read in the ad-seems cheap.

http://sfbay.craigslist.org/eby/cto/925912418.html

PB

 

Great price and great car if there are no stories. 360's are so out if 430 prices keep this up. This is not the first 430 coupe to see low $$ for sale. Cats exotics has another.

 

Lol, anyone not agreeing with Fenzoman's views of the market is deluting himself. The exotics market is tanking and by the time it's done tanking, gasoline will be on its way out. However, everytime I see that strad and I get into it, it puts a smile on my face.

-Peter Oh

 

I think it is great. If I ever need to sell something to get some cash I will tell my wife we need to sell something of hers since the exotic market has plummeted to nothing.

John

ps. It should help my insurance too!

 

It's a rare, insulated individual in this economy that could derive pleasure from the misfortunes of others.
The frivolous car market that we value is tanking, like it or not.
Good for buyers, bad for sellers, irrelevant in the long run because once the world economy is back up and running
the limited oil supply will eventually quiet all those lovely motors.
Keep your head in the sand or sell while you can, boys.

PS. Wait for celebrities? Anyone is game in a fur coat in Oregon. And it's not blood, it's rosso corsa acrylic enamel.

 

Now if only those service cost would fall also......