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why ? there are many ppl with garages full of cars who will start selling them off when their business are at risk ... you can survive pretty well if you only keep 2-3 if you now own 8 or more such cars ... additionally many 765LT would go to ppl with currently high income but not the free funds to directly buy these cars (these would cancel orders if they look forward to a 10-20% income decline or more bc for example bonus pools are smaller or sales targets no more hit) ... additionally still many buy not to drive but to think they can make money on a flip (these will also now think twice with falling values in the whole market) ... most LE cars like the LT don't exist in a bubble (this can maybe be said about cars like Ferrari 250 GTO/ Speedtail or Valkyrie, but not a car of which we will see 765 x2 examples) ...

Personally, I would just keep what I have vs giving it away especially knowing we are not in a recession but rather a health crisis which "hopefully" will be mitigated soon. I guess we will see how things play out. As of today I am not seeing much if anything change.
 

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Discussion Starter #42
Personally, I would just keep what I have vs giving it away especially knowing we are not in a recession but rather a health crisis which "hopefully" will be mitigated soon. I guess we will see how things play out. As of today I am not seeing much if anything change.
We are already in a recession...
 

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Recessions absolutely do affect high-end luxury items...including cars like the 765LT.

I ordered and bought a 612 Scaglietti OTO back in 2008 for a 2009 delivery. Every OTO sold was pre-ordered. No show room floor examples. Order only. By the time I took delivery of mine there were several sitting on the dealer show room floor of people who backed out due to the financial crisis. Mine was a $394k car in 2009...so roughly $500k or more in today’s world..If cars in that price range were affected in 2009 they will be affected in 2020.
 

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We are already in a recession...
I have already been through ten recessions and am still here living my life. Not to make light of the many premature deaths the virus will bring, but society has incredible resilience and always comes back stronger. Recessions are like going to the dentist: it's no fun when you're in the chair, but before long you're out of it and can get back to what you were doing.
 

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you don't see the long term changes in your view of the market ... the disruption this brings can last for a longer time bc there were other external factors before (trade-wars, climate change discussion/policy, with companies needing to spend unusual amounts into R&D and so on ), which will be made worse by this ... also at the moment its fairly uncertain how long this virus mode will last (hopefully only some 2-3 months like in China) but it could also be much longer if it keeps jumping from one country to another and return later ...
thats a great question. I guess I’m not really sure what I consider long term changes. 6-18 months, yes. 5+ years, probably not. However historical markets have rebounded quickly (90-180 days) from pandemics.
 

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Maybe on a $100K Porsche but higher ticket items such as a 765 wont be affected. It also really depends on how this whole thing gets resolved and when.
I almost bought a 2007 LP640 in Summer 2008 for $200K. 430 Scuds tanked too IIRC.

The 675LT debuted in the bull market and still shit the bed in depreciation. 765LT would be much worse in a major recession like this.
 

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I almost bought a 2007 LP640 in Summer 2008 for $200K. 430 Scuds tanked too IIRC.

The 675LT debuted in the bull market and still shit the bed in depreciation. 765LT would be much worse in a major recession like this.
Don't forget that the 675LT program involved the spider 'surprise', ultimately more than doubling production numbers and upsetting a lot of folks.
 

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Don't forget that the 675LT program involved the spider 'surprise', ultimately more than doubling production numbers and upsetting a lot of folks.
Doesn't matter IMO. 765LT will have 50% more production than 675LT, and then they're definitely going to make a spider as well. Anyone who's only modestly wealthy thinking about buying an exotic right now is crazy. Huge downside risk. If you have 10s of millions of dollars, whatever, but if you have something like < $5M... that's nuts, and I believe lots of exotic buyers are in fact less than $5M.
 

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Doesn't matter IMO. 765LT will have 50% more production than 675LT, and then they're definitely going to make a spider as well. Anyone who's only modestly wealthy thinking about buying an exotic right now is crazy. Huge downside risk. If you have 10s of millions of dollars, whatever, but if you have something like < $5M... that's nuts, and I believe lots of exotic buyers are in fact less than $5M.
Even with a much higher wealth there is no rush to buy, especially being a bit smart you can anticipate that prices will go down significantly ... why buy one now if you can have 2 in a year or so ...
 

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I’m starting to see all exotic prices fall considerably. I figure average depreciation for on the lot stock is 1-1.5% per week at this point. If this virus lasts 6-8 weeks. Look out.
 

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Was quite keen on a 765 a week or two ago but now my shares have tanked, my tenants may default and I may have to take a pay cut in my day job to help the organisation survive. Fortunately no debt and hopefully it won't get bad enough that I have to sell my cars. As far as McLaren is concerned, the release of the 765 could not have been timed any worse. Agree that there probably will be quite a few of these cars looking for homes for a long while.
 

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I think it is common sense man.
Typically, when markets tank, purchasing high end exotic cars is not top of mind - and fewer numbers of cars are sold, which means, dealers and individuals, for the most part, are willing to negotiate further and/or offer better deals.
However, if someone is telling you otherwise and they are feeding you line about percentages and expectations, they are either high AF or you are, for believing it. Nobody can predict these things with accuracy - you just have to use common sense.
 

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Yeah, I have a feeling the 765LT is not going to do well in the depreciation department. But a lot of exotics will be in the same boat.

I was all ready to buy a 765LT if I could get an allocation, but am going to hold off now.

Fortunately business is still doing good, I have no debt, lots of cash, and plenty of time for my investments to come back. But I am just in no hurry to buy any exotics when the prices will probably fall. I think I may wait until the tail end of this thing and buy a 675LT, which will be even more of a bargain. Then wait for the 765LT spider release and pick up a coupe that has already depreciated some.
 

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Looking back at the 2009 crash and its effects on the luxury auto market, I gather there was a relatively short dip in exotic prices followed by a long boom. Which I did not expect. This is not to say Covid-19 will have the same effects on the market and our long-term purchasing power (I hope not), but it's the most recent and similar comparison I can draw from.

Was anyone active in the exotic market during the 2009 crash and can comment? How did the prices behave; were there dealer incentives; and general your comments would be helpful in this conversation.
 

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2008/2009 was extremely positive long term for those with cash because of the market returns in 2009-2019 and extremely negative for the common man. A lot of the income inequality was driven off of that event. This will be much the same. The hourly worker is going to get crushed. Wealthy individuals will take a short term hit but if they have cash on the sidelines they'll be far wealthier in 2-5 years than if this event did not take place. I was incredibly fortunate to have a massive liquidity event in December of 2019 and have 90% of my money in cash. I expect to do quite well in the next few years due to this event. I fear for the average worker and their ability to get through. For my own Karma I'll look out for the workers and friends over buying super cars until we see what happens here.
 

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2008/2009 was extremely positive long term for those with cash because of the market returns in 2009-2019 and extremely negative for the common man. A lot of the income inequality was driven off of that event. This will be much the same. The hourly worker is going to get crushed. Wealthy individuals will take a short term hit but if they have cash on the sidelines they'll be far wealthier in 2-5 years than if this event did not take place. I was incredibly fortunate to have a massive liquidity event in December of 2019 and have 90% of my money in cash. I expect to do quite well in the next few years due to this event. I fear for the average worker and their ability to get through. For my own Karma I'll look out for the workers and friends over buying super cars until we see what happens here.
Could you give a little more insight over why those with cash liquidity will benefit from this current economy?
 

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Could you give a little more insight over why those with cash liquidity will benefit from this current economy?
I know you're not quoting me but this can be answered generically:

  • Those holding cash vs. investments will not experience the same losses as the market continues to fall. The delta between the resulting wealth will increase the buying power of those with cash.
  • Those making buying decisions with their cash based on the relatively low cost of market positions will benefit medium-long term as the market rebounds.
  • Those buying and executing on call/put options on the fluctuating market can benefit tremendously.
 
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