2021 F8 what would you do after 1 year

My new F8 has just arrived. Been 18 months since I ordered it. I currently have a 2010 458 Italia with about 25K miles which is in showroom condition (owe 90K). As is the case with many business owners my business is down about 15% this year which in the 300K to 400K lost revenue. The original plan was to put about 75K down on the F8 and pay the 17K in taxes, and finance the rest with a balloon and sell the 458. Given the lost revenue I am very hesitant to take 75K out of my business as I may need it for cash flow. That leaves me with a total finance with balloon option which comes out to a monthly payment of about $3100, as opposed to something in the $1800 range.

As many of you are aware I signed an agreement not to sell the car for a year so I can't just flip it.

Would love some input on what I should do next.

1. Finance as about at 3100 a month and sell in a year. I suspect I may be worth 75 to 100K more then I paid for it. And hold on to my 458

2. Keep it and wait to sell the 458, then refinance.

3. not take delivery and let the dealer exercise their buy option. If they don't then I can try to sell it now for over 300K

 

No one can answer those questions for you to that level of detail to the degree you are probably hoping for. The fact that you are number crunching to that degree and posting such a precise financial question for strangers' opinion indicates to me you are not comfortable in your gut purchasing the F8.

Personally, my view is uncomfortable decision making should be left to tough business decisions, not luxury goods. Buying a luxury car should not feel uncomfortable, and if it did I wouldn't go through with it.

Also note that you don't have to take delivery of a car you ordered...you can back out and just lose your deposit, which is a sunk cost in your situation anyways.

 

how much are you financing on the f8 that your payment is only 3100

 

which state are you in?

 

dont take delivery of the F8. if you are this concerned about the finances, walk away now.

 

Just sell the 458. Then decide from there. The F8 is so spectacular.... With this Vaccine coming on board quickly, maybe your business will regain traction too!
Best of Luck!

 

How do you expect the car to be worth 75-100k more than you are paying?? Do you mean less since it will depreciate? Like others have said, if you are worried about the costs it is probably better to pass on the F8.

 

I'm with Socal. If this is causing you angst, Don't do it. Unless you're forecasting that your business in 2021 will get back on track. On another note, not sure what kind of margins your business does but $2.2-2.4MM in annual revenue is pretty lean to be buying a $350k car. That's purely my opinion though feel free to ignore me.

 

if you are in CA, you will be able to get your deposit back legally despite the sour relationship with the dealer. If you need 75k cash flow for your business, I don't think I will buy the F8 for now. I would explain to the dealership nicely and they will understand because of the covid and you are not the only one and the last one. You will lose a lot in the range of 50k the moment you take the F8 off the lot, guaranteed.

You won't be able to flip F8, as it is already yesterday's news unfortunately. Look at Pista. You however may be able to come out even with 458.

 

I don't know what you have into the F8 already, but it's sometimes easier and better just to walk away. All your scenarios sound complicated and not without further risk.

 

If your business has any employees, the acquisition of a Ferrari by the company owner/CEO during these times will not be well looked upon.

 

Another point to consider- not sure how long you owned the 458, but 90k is a decent sized note foe a 10 year old car. However that also means you have about 100k equity in the car. Why not trade the 458 in for the F8. That’s a 100k deposit and then put maybe 25k more down.
Just a suggestion to on. Good luck.

 

Cant believe why someone would resort to asking strangers on an internet for advice on financial matters when its clear there is so much discomfort and concern being expressed.

Clearly the best option is to hold the low exposure 458 and walk from the F8 and Id be offering that same advice even if op had no financial issues.

These std production cars all depreciate heavily, particularly these late model Ferraris where huge numbers are made.

Not too long from now there will be a smattering of F8s to choose from anyway so whatever hit is taken by walking away will be recovered and then some.

I think op already has his own answer but hes just reluctant to execute.

 

FWIW, I wholeheartedly agree 100% with Obbob above. I've been in both situations, one where money is tight and one where money is not an issue. I've also been a business owner myself, for 15 yrs. I know what this is all about.

With this in mind, I would NOT pull the trigger with the F8. The 458 is an awesome car already and a luxury to have even in good times!

 

Absolutely. I try to keep it as low profile as possible and we're doing extremely well considering the circumstances.

 

$3,100 car payment makes me laugh. Anyone who has that kind of payment on a depreciating assest that brings in zero income is a complete idiot. People think that is ok and that's why this Country is such a mess. I have zero respect for anyone who finances a Ferrari If you have to finance a toy, then you can't afford it.

 

Eh, idk. If you have to finance then don’t. If you can afford to finance it, that’s really where it’s at. I put vehicles on my LOC from time to time. My line is $15mm. I pay 1.5% on it. I struggle come out of pocket when money is this cheap.

 

I get your point, but with all due respect, I'd refrain from using harsh words. I think that's also why the country is in such a mess...

As far as financing, I think it'll depend on the situation. Here's 2 facts:

1) Many Ferraris get sold within a 2-yr period.
2) Cash is king

With these facts in mind, one can argue that financing the car, including paying a low down payment, might make sense.

 

I think that's a fact because people no longer want to make their payment. I know more people finance Ferraris than who pay cash. I have owned each of my Ferraris until I had enough cash to move up to a more expensive model.

As for the other Op I just roll my eyes when people say money is so cheap or free. 1.5% is 1.5%. Everyone has different philosophies. I don't owe a penny to anyone. My business doesn't owe a penny on anything. I can under stand if you have a new business financing is usually always needed for 5-7 years but a business should be debt free before an owner is splurging on exotic toys. Let alone someone having enough cash to pay for it.

 

I hear you and understand your philosophy. I bootstrapped my business so I get it. But at 1.5%... You can easily put your money to work and make more than that. So I'd rather not pay $200k upfront.

 

I pay cash foe my toys. But I have used my line for short term self financing if cash wasn’t readily available or would be a tax hit to liquidate stocks or something. But I agree- financing when you u can’t afford - not a good idea. Financing to leverage cheap money- no issues.

 

1.5% is far less than I make on that money elsewhere. You can eyeroll. It’s simple math. However I’m definitely not advocating overleveraging.

Btw, you should look into the power of appropriate leverage on return maximization and tax reduction. Take the ego out of it. It’s real.

 

I'm not greedy. I make plenty with my business. I'm not a fan of financial advisors, brokers, and bankers. I also pay all my taxes. If I over pay so be it. Someone has to pay for the 54% of people in this country that pay no income tax. They depend on me.

 

The entire companies of Ferrari, Lamborghini, Porsche, Aston Martin and McLaren would all still be making 1,000 cars a year max if it was cash buyers only. Lamborghini in particular would be busted and continued to be passed around from owner to owner.

It's buyers willing to lease or finance for $2,600-8,000 per month that keeps their lights on now. (I've heard of financing Aventador Roadsters for nearly $10k/mo).

 

they depend on you? Lol. Check that ego at the door. Btw, nobody over or underpays on taxes. The IRS will assess you appropriately depending on the deductions that you or your advisors put in the effort to attain.