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Richard McCreery's Business Editorial
RLTV 16
Apr 10
Riviera based Independent Investment Adviser, Richard
McCreery, has joined the expanding RivieraLife.tv
team as Business Editor. Richard publishes a weekly Financial
Editorial every Friday with
informed comment on topical financial matters relevant to
residents and businesses on the Cote d'Azur. |
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This
week the 7th Top Marques super-car show is on at the
Grimaldi Forum in Monaco. It’s a collection of the word’s
most luxurious, expensive and extravagant cars that includes
top-of-the-range examples from the mainstream manufacturers such
as BMW and Mercedes as well as some tiny manufacturers such as
Fisker and Caparo who make only a handful of cars each year. The
car industry has been through a difficult time as a result of
the credit crunch and the top end of the market has not been
immune. |
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The
credit freeze has been particularly devastating for the modern
day business model of a car manufacturer because credit is used
to finance a huge proportion of car sales, even in the luxury
market, and the car industry has changed significantly in recent
years. The American brand Hummer has been closed down by its
parent GM after failing to find a buyer. The Dutch super-car
manufacturer Spyker has acquired the Swedish company Saab,
despite never having made a profit selling its own cars in the
past 10 years, and there are rumours that Mercedes will sell its
über-luxury brand Maybach after reporting 2009 sales of just
200 cars. Another major change is that China has now become the
largest car market in the world, overtaking the USA, whilst car
sales in Europe declined last year even with a massive injection
of taxpayers funds to support sales. |
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The
cars on display here in Monaco are very much the preserve of the
wealthy, many of whom will own several cars and who own a number
of them for enjoyment rather than simply as transport. This end
of the market has different dynamics from the wider mass
production market and its customers have generally retained much
of their wealth during the downturn. It is also fair to say that
for the ultra high net worth customer the purchase of a car does
not usually make a significant dent in their overall wealth and
therefore they still have the ability to buy a desirable new
super-car if they choose. The number of millionaires in the
world has expanded rapidly in recent years as emerging market
economies such as China, Russia and India have created wealthy
individuals who want to enjoy their money and who also want to
illustrate their new position in society. A super-car is an
obvious way to do this. |
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Sales
of sports cars from Ferrari, Lamborghini and Porsche have been
surprisingly resilient, even as the average person has been
cutting back on spending, and whilst this may be due in part to
brand loyalty from buyers, they may also have ordered their cars
before the downturn began and are only now taking delivery. The
market for super-yachts has seen a significant number of buyers
pull out of their purchase before taking delivery, resulting in
some canny purchases for others with the cash to buy these
distressed assets, and the purchase of a car doesn’t require
quite the same financial commitment so there have been
relatively few distressed sales. One of the most striking images
of the Great Depression of the 1930s was that of stock brokers
attempting to offload their luxury cars in order to raise cash
but this time round they seem to have been spared, and they are
still buying. |
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Whilst
some might have expected the early years of the 21st
century to turn out to be the peak of a golden age for luxury or
super-car manufacturers, only to be followed by the inevitable
downturn, the opposite almost looks to be true. McLaren are
introducing a new super-car, Rolls Royce sales are going strong
and they have just introduced the baby Rolls for the customer
who wants to appear ‘slightly less’ ostentatious. Audi is
launching its most expensive car ever with the R8 Spyder that
starts at €162,300 before you add any options and even Bugatti
is adding another car to its current 1 car range. There is
little sign of a let-up in the new supply of such expensive
motors. |
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The
Top Marques show in Monaco is probably a good example of how
resilient the market for super-cars has proven to be and even if
sales are a little slower than they were a couple of years ago,
the fact that we still have a super-car show at all, with an
amazing range of unique and unusual cars from
micro-manufacturers, is evidence that there is still money to be
spent and plenty of it is still going on cars. The rich still
want their toys and, in contrast to past recessions, they still
have the money to pay for them. |
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Richard McCreery 16th April 2010 Send us
your comments for publication email:
richard@rivieralife.tv |
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The
7th edition of
Top Marques Monaco took place at the
Grimaldi Forum,
Monaco 15-18 Apr 10. It is the world's only live supercar show,
described as a showcase for the haute couture of the motor
industry. RivieraLife.tv correspondent
Andrew Burroughs reports on
this years show featuring the worlds most expensive car; the
most powerful car at the show; an electric supercar; a no frills sports
car from Nahr; the worlds most expensive golf cart and a bling bling
motor that would even startle the makers of
MTV's 'Pimp My Ride'! |
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Read Richard's
previous blogs |
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09
Apr 10 Expect More Strikes In France |
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02
Apr 10 Riviera
property still popular, but prices have fallen |
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26
Mar 10 Carbon tax dumped but are new taxes planned? |
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19
Mar 10 Riviera Living set
to get even more expensive |
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12
Mar 10 Euro battered, but
not as much as the Pound |
