Volkswagen

qwert_yuiop

...and right on cue this morning, the ratings agencies Moody's and Fitch have declared a significant risk to vw bonds due to decrease in second hand car values.

motorguy

qwert_yuiop wrote: »

...and right on cue this morning, the ratings agencies Moody's and Fitch have declared a significant risk to vw bonds due to decrease in second hand car values.

Really? Have you a link to that? Why would VW bonds be impacted by any decrease in used car values?

Their statement from the 29th never mentioned used car values?

"The damage to Volkswagen’s reputation and credibility from its alleged breach of US environment rules will curtail future earnings and cash flow generation, in addition to potential material fines and further recall costs. The company will face more pressure on its ratings if the impact of the scandal spills over into its core markets outside the US, particularly Europe where the bulk of the 11 million affected cars were sold. Any resulting significant damage to the company’s market share or pricing position, with sustained negative impact on revenues or EBITDA, could lead to further negative rating actions."

qwert_yuiop

Irish independent

motorguy

qwert_yuiop wrote: »

Irish independent

I think its a small extract pulled out of a much bigger report that makes for a good newspaper story.

The "risk" they are talking about is that more people may hand their cars back at the end of a PCP deal or similar which could impact profitability of bonds used to finance the deals.

qwert_yuiop

Correct. Also the value of cars repossessed will be impacted.

RikM

Surely, part of the risk will be that "corrected" new cars aren't as attractive, both for performance and reputation reasons - directly hitting the VW group bottom line.

Lost the green and boy racer groups, in one go...

motorguy

RikM wrote: »

Surely, part of the risk will be that "corrected" new cars aren't as attractive, both for performance and reputation reasons - directly hitting the VW group bottom line.

Lost the green and boy racer groups, in one go...

It'll only hit the bottom line if they sell fewer.

I'd imagine the VW publicity machine will have ground into action to ensure people dont have that perception though.

qwert_yuiop

Does anyone on here borrow money to buy a car? As money savers, I'd have thought you'd all be averse to paying interest, using money you've paid tax on to acquire an asset that's losing value. Not a good move in most cases.

motorguy

qwert_yuiop wrote: »

Does anyone on here borrow money to buy a car? As money savers, I'd have thought you'd all be averse to paying interest, using money you've paid tax on to acquire an asset that's losing value. Not a good move in most cases.

True.

Bought the Jag with cash and its replacement in the new year will be bought with cash.

The 370Z is on a very low APR finance agreement. We got the car for £3,000 less than the cheapest available anywhere in the UK, so we're still better off than someone else buying the next cheapest with cash. We negotiated hard and happened to be in the right place at the right time - in fact i just checked there and the cheapest one in the UK with similar miles to ours is still £2,000 more than we paid for ours (AND its on the mainland), and we've had ours six months. :money:

If someone is happy to budget £X per month and has done so in an MSE manner, then thats their perrogative. Not everyone wants to drive a banger.


However my view is that MSE is about ensuring you get the best value for your money, hence why you see great deals on say a discounted SONY TV being promoted and viewed as a good deal when a Matsui will do a similar job for £200 less. For any item i buy, i'd rather search around and / or negotiate hard on the item i want (and i've often taken advice from the MSE forums on what to buy and how much to pay) rather than settle for something i dont really want, just because its cheaper.

A car i'd consider buying on finance, but anything else its cash for the item i want, or wait until i have cash

qwert_yuiop

For business purposes it used to be quite easy to write off all these expenses against income, but now accountants recommend you claim mileage at civil service rates. This is the first year I'm using that method, so I don't know what the difference will be. I suspect it won't be as good, otherwise they wouldn't have changed it.