Depression in the UK. Is it really that bad?

Page may contain affiliate links. Please see terms for details.
Ive had a slow year but November and December have been very very busy... hopefully will stay that way..
 
I read this yesterday and it has been bugging me ever since. Having looked on the Merc UK website at the current new car offers, if this statement is true then why are Merc Finance still offering an ML320CDI (£43350 OTR) with a Guaranteed value of £29725 after two years?
69% of its list price and also with subsidised finance at 6.9% APR?

That is exactly the reason there are in serious trouble, the fact they are saying an ML320cdi is going to be worth £30k in 3 years is laughable.

My Dads neighbour just swapped his ML270cdi for an August 2007 ML320cdi last week and he paid £20500 for it from the main dealer.
So that is a car at just over a year old and he has paid £20500 for it, so I guess the buy back if he took it to trade in tomorrow would be around £17500.
So it is worth £17500 at a year old, in another 18 months to 2 years I bet that will retail for £12k and have a buy back of £9k??
And Mercedes are going to be buying back loads off people for £30k at 2 years old.

Well that is why they are in trouble! :(
 
And Mercedes are going to be buying back loads off people for £30k at 2 years old.

But they're not because it didn't cost £45k in the first place.

If it cost them say £22k they are getting it back for under £10k.
 
Surely paying off debt is the same as saving? So reduce the mortgage.

RH

ordinarily yes - it is likely to be much more "efficient" to pay off debts than to save. However, under the current climate of job uncertainty, it is better to have ready cash to live on stashed away somewhere. Money used to pay down a mortgage can't be easily got back to spend on living if you have no job.

Les
 
From what I've seen, there are too many first time buyers wanting 3 bed semi's! Why 1 person wants a 3 bed semi just defies logic....

So that when they start a family they dont have to move home.
 
So that when they start a family they dont have to move home.

Moving is a stressful and expensive experience particularly stamp duty. It would cost me the thick end of £25,000 to move and £20,000 of that is just to the government for "stamping" some paperwork. And they say your principle private residence is "tax free"? What utter garbage.
Les
 
But they're not because it didn't cost £45k in the first place.

If it cost them say £22k they are getting it back for under £10k.

It may have cost Mercedes AG £22k to make, but they sell it to Mercedes UK for quite a bit more and they in turn make their profit from it. But it is more like 10-15% each, a £38k ML would cost Merc UK around £32k before kickbacks or promotional contributions I would guess.

The fact of the matter is when they agreed the buy backs 1, 2 or 3 years ago they thought these cars would be worth a hell of a lot more to them than they are now.

Whether it cost them £22k or not is not the point, the point is they are buying back cars that are worth around £10k for nearly £30k, and that is not good business practice.
 
merc uk PCP

I also have been pondering trading the ML 270 in against either a 1 year old ML or E320 cdi est - the GFV being offered seems too good to be true, allowing for the fact that you are hooked into trading for another down the line it still seems a good way to reduce your losses on depreciation - or am I being naive :eek:
 
I also have been pondering trading the ML 270 in against either a 1 year old ML or E320 cdi est - the GFV being offered seems too good to be true, allowing for the fact that you are hooked into trading for another down the line it still seems a good way to reduce your losses on depreciation - or am I being naive :eek:


£38k new with a £29k GFV means you have to pay £9k plus interest over 3 years and the interest on the £29k.

2007 car at £21k with a GFV of say £10k (which should be doable) means you have to pay £11k over 3 years but interest on the £11k is going to be a lot less.

I would also guess you will throw the keys back on the new car, but you may have a grand or two on the year old one as you may find that is is worth £11k or £12k.
 
My view is that some banks through ISA and SIPP are offering 6% savings rates. So if your mortgage rate is less than 6% then it is better to save than to pay off debt.

WOW tell me where???

Most are nearer 4% the best I can see is First Direct at 7% for savers not lumpsums - and that is for one year and then reverts to e-isa of 1.5%.....so you're capped at £300 a month........a lot of hassle for a few extra pennies...but in theory you're right.
 
Last edited:
We are busier than ever at present (IT consultancy/development). No exposure to manufacturing/building sectors helps, but defence, telecomms and finance(!) are all busy.
 
From a recruiters (mainly temps) standpoint, with a big exposure to construction, 2008 sales were down 3% on 2007 which isnt that bad, but the last quarter saw us doing 2/3rds what we would have done in a 'normal' year. Plently clients still got decent order books, others are on their ****. We need to deal with the busier ones.

Other sectors we work in, e.g. Industrial Temps, e.g. chicken choppers, picker/packers etc were up 6% year on year

The perm side is much quieter though, vacancies dried up, decsions on hold, but companies are still recruiting, just need to be better than our competition

To keep profitable we have reduced staff numbers from 80 to 60 since the summer
 
Where's Hawk20 when you need him
I'm here. And what is happening to residuals shows how PCP's with a good GFV can be very beneficial. I'd rather be the customer than Mercedes on the deals that have been offered in the last twelve months. MB and BMW will lose huge amounts when many of the cars are handed back after two or three years.

BTW people keep saying it costs 5p to make a car. Don't they notice that most car makers are losing money -even Toyota. Even in the good years the profit margin on most makes was tiny. If they make a few hundred pounds per car -net of all costs- they are lucky.

And dealers make very small margins too. That is why many are going out of business even before the recession. Very competitive market with high overheads and lots of discounting.
 
The media are always looking for an angle or a hook.

This means that they can shout "House prices to fall X%" without even referencing where that measurement starts.

During the mid-nineties recession I can distinctly remember Ceefax reporting two headlines on the same page - one saying houseprices rising and the other saying they were falling. They don't really care or cross check (the headlines referred to reports from two different banks/building societies).

.

True about the headlines but usually if you read the text they do state such as 'will fall 20% from the peak' or even 'from the peak in 2007'.

The truth is that there is no need to sensationalise. New mortgages are only about half the level they were a year ago. So either only half the houses can sell, or they can sell at half the old price; or somewhere in between. We are getting somewhere in between. House prices down 10% to 15% in most areas (much more in some) since 2007 and probably by the bottom we shall have seen average house prices drop by 25% or more. That seems to be the concensus of most who follow this market.

And for first time buyers that will be a good thing. House prices have risen to levels which were clearly unsustainable and the lack of action by govt and the B of E to curb the inflation in house prices was a prime cause of the bubble getting so big that it burst. Same in the US.
 
I'm here. And what is happening to residuals shows how PCP's with a good GFV can be very beneficial. I'd rather be the customer than Mercedes on the deals that have been offered in the last twelve months. MB and BMW will lose huge amounts when many of the cars are handed back after two or three years.

BTW people keep saying it costs 5p to make a car. Don't they notice that most car makers are losing money -even Toyota. Even in the good years the profit margin on most makes was tiny. If they make a few hundred pounds per car -net of all costs- they are lucky.

And dealers make very small margins too. That is why many are going out of business even before the recession. Very competitive market with high overheads and lots of discounting.

That is very true, I know that on some Ford models the dealer makes nothing on the car, it is all done by bonuses, sell xx amount and get a kick back.
Another problem is each dealer had to spend tens of thousands a couple of years back to have a team come in and make the dealership look the same as the other dealerships, and many are still paying for that now and it is eating what little profits they are making away.

I would guess most brands are in the same position.

I know my mate has just told Ford to sod off as they wanted them to do another refit last year, so he has lost his official dealership status.

He isn't too fussed anyway as he said most of the new cars he sold made no money or lost him money anyway, so happy to go into used sales only.
 

Users who are viewing this thread

Back
Top Bottom