In the middle of 2008 we started to note that the metrics were beginning to go the wrong way
Wow,things must have been pretty jolly during the first half then. I d have thought you might have spotted something was up even with the bino's the wrong way around, but, guess not.
In Fairline's defense, the world's entire car industry didn't seem to spot it until then either, we had a high sales month even in September 08, then they fell off a cliff in October.
It was more surprise on my part, not really a criticism. And maybe they had spotted the possible problems and were waiting til they saw things in hard figures.
So I mainly meant "hit them" in terms of sales, not "hit them" in terms of did they notice the world might just fall apart. Perhaps thats what the MD meant too.
In Fairline's defense, the world's entire car industry didn't seem to spot it until then either, we had a high sales month even in September 08, then they fell off a cliff in October.
..being a little involved with the retail car industry I agree certainly front end of 08 was OK for us, nothing special, but it was the fourth quarter which was just horrible! Just glade 2009 has been a complete turnaround.... so far..
I do recall reading an article mid 2008 stating that Sunseeker had seen as yet no noticeable downturn in their order take..... now Sunseeker sell far more product rest of world than Fairline which may have accounted for that initial position, but perhaps if Fairlines order take was initially not effected they naively thought they could weather the storm unscathed...?! god knows!
I think is very different to compare a luxury yacht builder with cars
and then when it is Fairline it is also difficult may be even more for Sunseeker due to there global branding
the fact is that actual sales to British UK people for Fline can be at about 50 boats a year in the best times make that to about average of 40
I think a good car dealer can sell much more to what is Fline max production of about 300 BPY
take also the full global coverage and you might never know when is going to happen and how big it is going to be until it does
I read an interview with Norberto Ferretti where he says basically the same things, Norberto unlike Fairline but is very cautious on the future and says the market is back to how it was in the end of the ninties begining new millenium where people buy a fifty footer and a couple of years later will buy a 55
in the past years he said (before 2008) clients where coming to buy an eighty footer and on negotiation will finish to buy a hundred footer...
Ferretti says 2010 will be good but will also give a guide of the future but he says before 2012 he does not see a confidence and return to sales as good as 2007
I think is very different to compare a luxury yacht builder with cars
Not when you're just talking about a general reduction in sales due to a recession its not. People fear they might lose their job, or see their assets devalue, so they cut back on non-essential spending till things are a bit more certain. Actually 90%+ of people (the ones that don't lose their jobs) are in a better position to buy a boat during a recession that at any other time, because interest rates are lower and there's better deals to be had, but they don't buy new boats, or cars, because of the uncertainty. As that was the only comparison I was seeking to draw, I could have equally compared boat sales to sales of sofas, dining out, or boob jobs, but I don't sell any of them.
I think is very different to compare a luxury yacht builder with cars ...........................I think a good car dealer can sell much more to what is Fline max production of about 300 BPY
Yep, obviously the two markets are VERY different... everyone needs a car.... I also insist (to SWMBO) that everyone needs a boat.... just most people never realise it! But yes, a boat is a luxury purchase. it was just an agreement of sale downturn...and the fact I have some experience in cars....but I do wish my experience was in boob jobs!
.........and FYI.... yes, any large dealer worth his salts with a medium volume franchise will sell well in excess of 300 units PA, but remember, car dealers are NOT manufacturers.... we struggle to hold onto a small %age of a margin given to us by the very controlling manufacturers.... obviously Fairline IS the manufacturer.... a different case altogether!
agree Nick,
my referring but was more to the fact of globalness which these builders have
today 2009 is very different from the eighties and nineties and that is why many renowned names thought at the time they will get through this
most builders where saying if US and England and EU got slower we have East EU and the Middle East plus Australia so we might get out of this when is all over, plus we also have a big back log or order of a year on some models
problem is with media today a recession also spreads globally much faster today...
just to see how wrong they where Fairline delivered 126 boats out of a max production of 300, they estimated sales deliverise of 200 boats for 2008
for 2007 they estimated 250 and sold 200
apparently Ferretti Group still wants to sell Apreamare and its new premises in Sorrento, but Itama is not for sale, and nor is Bertram
the best selling brands for the group are CRN, Ferretti Custom Line and Pershing
In the middle of 2008 we started to note that the metrics were beginning to go the wrong way
Wow,things must have been pretty jolly during the first half then. I d have thought you might have spotted something was up even with the bino's the wrong way around, but, guess not.
Things were jolly enough in the first half. The credit crunch was happening thru 2008 and Bear Stearns/Northern Rock had happened, but the big event that shook people and made them lose confidence bigtime, and made the banks stop lending, and caused several thousand City folks not to get bonuses, was Lehmans weekend, mid September 2008. Soon after that you had WaMu, Merrill Lynch, HBOS, and so on, but the 16 September 2008 weekend was the big fall off a cliff point (the time that nick H refers to above)
Things were jolly enough in the first half. The credit crunch was happening thru 2008 and Bear Stearns/Northern Rock had happened, but the big event that shook people and made them lose confidence bigtime, and made the banks stop lending, and caused several thousand City folks not to get bonuses, was Lehmans weekend, mid September 2008. Soon after that you had WaMu, Merrill Lynch, HBOS, and so on, but the 16 September 2008 weekend was the big fall off a cliff point (the time that nick H refers to above)
The writing was on the wall way before mid 2008 and boat builders really should have been planning for market decline well before then. Northern Wreck went tits up in Sept 2007 and that was definitely the beginning of the crash in many markets. Sterling dived over the Christmas/New Year hols 2007/8 and during the first half of 2008, the stock market and property markets were in freefall so there were plenty of signals that the new boat market was about to suffer
Agree though that Lehmans was what pushed the global economy off the proverbial cliff. I was in Dubai the week before and business peeps were confidently predicting that Dubai would ride out the credit crunch unscathed. A week later and Dubai fell down a large hole. IMHO, the severity of the global downturn would have been far less had Lehmans been saved that weekend
yep, I know the timeline well enough, day by day, if not hour by hour, on some occasions.
And as I also said, the MD comments dont clarify whether they had some foresight and mid 2008 was when they decided to take action, or whether they didnt see anything at all until mid 2008.
OK, they are in boat building and I m not, but I still would remain surprised if the situation mid 2008 came as a surprise.
And for sure, if mid 2008 WAS a surprise, they were about to get slaughtered by events a few months later. But, just that shows how wary one should be of ex GS employees in senior government positions
And as I also said, the MD comments dont clarify whether they had some foresight and mid 2008 was when they decided to take action, or whether they didnt see anything at all until mid 2008.
People often see what they want to see...
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Ari
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If a man speaks in a forest, and there is no woman to hear him, is he still wrong..?
Did it really hit them that late?
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