Phil's philosophical reflections on collapsing prices, scrappage, Volvo Valhalla etc.

[Flatout Phil]

T5Rs and Rs going for scrappage, prices plummeting by the week - I am trying to see a silver lining in this cloud.
I am looking at the long game - now, given how few of these cars there are, and the apparent commonplace of them going for scrap, it seems to me that, in a fairly short time those that are left will (as the economomy heaves around by about 2013) actually benefit from these sad departures. So a bit like that ghastly Talbot Sunbeam in Pistonheads for £9k, I think a time will come - in the not too distant future - when prices will start to creep the other way: because there will be SO FEW LEFT. You may have a different opinion completely.
Whatever the future, my R thrills me every time I turn the key - I get on well with the guys at the filling station etc. As I may have said before, it may be worth nothing (or at least very little) in the performance estate market of today - but just how much fuel could you buy with the thirty-odd thousand quid you saved NOT buying a new performance estate???
Mine ain't going to Valhalla for a very long time if I have anything to do with it!

[AlanG]

Said this on here before mate and I think it's already starting albeit slowly. Gobby Brownose ain't gettin' mine and I think some will regret their actions,especially when their brand new econoboxes are no longer new. I've parted with more than one car before which I regretted. One that springs to mind was a factory standard '83 Y plate Sierra 2.3GL V6 5sp manual. A sleeper of it's day. Learned from that..

[Flatout Phil]

Originally Posted by AlanG

Said this on here before mate and I think it's already starting albeit slowly. Gobby Brownose ain't gettin' mine and I think some will regret their actions,especially when their brand new econoboxes are no longer new. I've parted with more than one car before which I regretted. One that springs to mind was a factory standard '83 Y plate Sierra 2.3GL V6 5sp manual. A sleeper of it's day. Learned from that..

My chum John has over the years had a selection of choice cheap motors, bought, fiddled with - but never kept - several of which would have been worth a mint now eg:
Mk1 GTi Campaign, a Spike Anderson Samuri (his spelling) Conversions Datsun (can't remember the model but like a 120Y) with a 240Z endgine and drivetrain built as one of two in the mid seventies - called a Sukarti. Apparently the twin car held the HEIGHT record for a crash at Silverstone! Oh, that was a car to drive I can tell you. Bought for a grand sold for a grand. Datsun 240Z - wonderful machine. Renault 10 - look it up, cost £200. Opel Manta A-Series Broadspeed Turbo - he couln't be bothered to sort it. These days, it has been long since sold on, but turns out it was one of the three press cars made of this incredibly sought after model. He flogged it for £1500. Weep. Alfasud Cloverleaf - it would have turned to dust by now but gorgeous motor. I bought my best ever Imp from him (£50) although I had sourced it for him £300, he didn't want to maintain it. Now drives a Fiat Doblo...
So, there is a moral to the tale. A lot of ordinary extra-ordinary cars are ditched for no good reason. What remains becomes the collectors item of not so very long into the future. I mean, you try finding a 240Z these days. And fond out the cost of a Broadspeed Turbo Manta A-series - you will get my point.

[AlanG]

With you totally Phil. Wish I had kept many of the cars that passed through my hands. It's similar to the regrets you have when you think of all the old Dinky Toys,Magazines etc,etc that you passed to wee cousins and so on. Hindsight is a wonderful thing as they say. Still.........We're older and wiser and keepin' our Volvo Turbos so we must have learned something..

[Marvin]

Also by hanging on to our old pride and joys, we are been environmentally friendly, as they have already made their carbon footprint. But on a financial point as someone on the forum said " if you spend £500 a year to keep it on the road its still amounts to less than depreciation and interest charges on a new car" I only have a 2.5T but it puts a smile on my face every time I turn the key, yes its my first unpractical car as the kids reach late teens.

[Flatout Phil]

Originally Posted by Marvin

Also by hanging on to our old pride and joys, we are been environmentally friendly, as they have already made their carbon footprint. But on a financial point as someone on the forum said " if you spend £500 a year to keep it on the road its still amounts to less than depreciation and interest charges on a new car" I only have a 2.5T but it puts a smile on my face every time I turn the key, yes its my first unpractical car as the kids reach late teens.

Nothing in the least impractical there. Totally logical.
And a 1.4 Golf may have some huge 2 litre equivalent output and a tiny fuel consumption - but a turbo and a supercharger: wait til the bills come in three years down the line. An as for the Toyota Priapus - try getting a new set of batteries for one of those!
By the way, scrappage set against a new car buys you about 90 days grace before that money is GONE IN DEPRECIATION - NINETY DAYS!!!
All of you scrappers put that in your economy pipes and smoke it.

[bomb192uk]

Long live the AWD!!!!!

(well, soon to be AWD again, got the gearbox, got the sleeve, now all I need is some good weather tomorrow and I'm sorted!)

[lance]

A family friend of ours is sending his beloved old Uno Turbo to for a Panda! I nearly cried!

[Mrs_PA]

Apart from a hiatus with a company car, we've always bought older cars (OK, bangers) and mostly we've been the final owners. It's the cheapest (if most nerve-wracking) form of motoring.

There's been some goodies along the way - an Opel Manta (sold on and now restored and looking fabulous), a Datsun 510 Station Wagon (colleague: "do you know your car smokes?" Me: "well, it IS old enough to smoke".) which went to the scrapyard after Chris banana'd it after taking a short cut down a road that wasn't yet opened and hit a pile of tarmac, at which point it took to the air, Dukes of Hazzard style and ended up on the embankment. We had a Vauxhall Senator in gold (ex-Lord Mayor's car), a beautiful looking Rover 850 with sh*te running gear, and a Hillman Imp. And some not so goodies, too, such as the procession of plastic pigs we had until I took my car driving test. We got them so I could drive on my bike licence, but after my first attempt at driving it, I stopped the *thing*, got out of the driver's door, threw the keys at Mr PA, and told him he could drive the *$@#&^! thing, and I never got behind the wheel of one again.

I've always said that driving older cars is more eco-friendly (what's the carbon footprint from just making a new car??) and I don't subscribe to this whole man-caused global warming ideology. If the world's getting warmer, it's the sun causing it, and we should be spending money to be prepared, not in a futile attempt to stop it.

[dave stew]

I sold an unfinished but 'most of work done' Mk2 RS2000 in 1992. I had stripped the shell and had it fully restored. Ditto the 2.1 Pinto, sourced a modified 5 speed gearbox that had been worked on by Caterham's gearbox man, got a set of genuine 7" wide RS alloys, reupholstered seats, Quaiffe LSD, 4 pot calipers, Janspeed exhaust etc etc.

Sold it for space in the garage for £2000. Sob.

[Flatout Phil]

Originally Posted by dave stew

I sold an unfinished but 'most of work done' Mk2 RS2000 in 1992. I had stripped the shell and had it fully restored. Ditto the 2.1 Pinto, sourced a modified 5 speed gearbox that had been worked on by Caterham's gearbox man, got a set of genuine 7" wide RS alloys, reupholstered seats, Quaiffe LSD, 4 pot calipers, Janspeed exhaust etc etc.

Sold it for space in the garage for £2000. Sob.

I weep!!!

[Flatout Phil]

Originally Posted by AlanG

With you totally Phil. Wish I had kept many of the cars that passed through my hands. It's similar to the regrets you have when you think of all the old Dinky Toys,Magazines etc,etc that you passed to wee cousins and so on. Hindsight is a wonderful thing as they say. Still.........We're older and wiser and keepin' our Volvo Turbos so we must have learned something..

Well, we're older anyway mate...

[TheFlyingFridgeMover]

I read the following on another forum, and yes, this is directred at the slightly different scrappage scheme the americans runs, but alot of it is still relevant to us, and the unintended consequences of the scrappage scheme....

1. You think it’s hard to find a good, honest mechanic now? Fewer clunkers on the road means fewer clunkers being repaired. Repair shops that specialize in older cars will really feel the pinch and many will undoubtedly go out of business.

2. Brother can you spare a muffler? Spare parts will cost more. Cash-for-Clunkers regulations dictate that any spare parts must be scavenged from the clunkers within 180 days. After that, all remaining parts – no matter how valuable – must be shredded. The Law of Supply and Demand dictates that scarcity of spare parts will lead directly to more expensive spare parts. Collision repair shops that depend on buying useable doors, hoods, and other body parts from salvage yards will undoubtedly see price increases.

3. Inflate to $4,500. Older cars will cost more, pricing them beyond the means of the poor who need them most. Since the Cash-for-Clunkers law requires that all trade-ins must be destroyed, the program has taken 690,114 (and counting) vehicles off the used-car market. A contracting supply will lead directly to price the smaller pool of remaining used vehicles. Unfortunately, that means the low-income people most likely to buy clunkers will not be able to afford them.

4. Blowing bubbles. Remember when Barney Frank railed against lenders who enticed low-income people to take on debt they couldn’t afford? Keep that in mind because that’s exactly what the government’s Cash-for-Clunkers program does with cars instead of real estate. In effect, when nearly 690,114 clunker drivers traded up to more expensive new cars, they took on piles of new debt and higher monthly payments.

5. Bubbles burst and clunkers crash. Cash-for-Clunkers unleashed pent-up demand for new cars that probably would have been made sometime down the road anyway. The Cash-for-Clunkers sales bubble cannot be sustained and will, therefore, reduce the number of new cars sold down the road. It’s likely that we just spent $3 billion simply to encourage hundreds of thousands of car buyers to make their purchases a few weeks or months earlier than they would have without the program.

6. Domo arigato, Mr. Obama. The Japanese economy was stimulated more than the American economy. According to the latest stats, eight of the top ten cars purchased under Cash-for-Clunkers were Japanese or Korean. Most of the ones traded in were American-made. Asian manufacturers saw their market shares increase and American manufacturers saw their shares decrease. In effect, Cash-for-Clunkers stimulated the Japanese economy at the expense of the American taxpayer.

7. The Clunker Children’s Fund. When more old cars are destroyed, it means fewer old cars will be donated to charities that depend on those donations for funding. Numerous charities say they’ve already seen auto donations drop substantially.

8. Let them eat carbon. Those who replace their clunkers with new cars will see their monthly payments increase, giving them less discretionary income for other purchases.

9. Baby you can drive up the price of my drive train. Engines and drive trains have always been the most valuable parts of clunkers. They’re often rebuilt and put back in other serviceable used cars. As the clunkers’ engines and drive trains are destroyed at the dealerships, it will cause prices to increase.

10. Bear market for junkyard dogs. Engines and drive trains have account for about 80% of the value of a scrapped car. But Cash-for-Clunkers regulations require that the engine and drive train be destroyed before the car leaves the dealership. So not only are salvage yards denied their most valuable products, they’re given just 180 days to sell any remaining parts they’re able to scavenge. After that, each car mus be shredded and sold for scrap value – sometimes no more than a few dollars.

11. Drill, baby, drill. Strange but true: research shows that the purchase of new cars cause people to change their driving habits. CNW Marketing Research says that clunkers were driven only about 6,200 miles in 2008, but new car owners drive an average of 12,000. Even with better gas mileage on the new cars, they’ll burn an average of 61 extra gallons of gas annually. Multiply that by 690,114 vehicles, and those wasted gallons of gas really start to add up.

12. Sticker shockin’ it to the man. We’ve had an oversupply of cars for the last couple years because automakers didn’t anticipate the 2008-2009’s steep drop in sales. That made it a buyer’s market. In response, automakers reduced production, bringing it in line with demand. Cash-for-Clunkers has now flipped that situation upside down and created shortages. Short supply leads directly to higher prices.

13. Don’t mess with taxes. Surprise, surprise. Not many of those rushing to take advantage of the Cash-for-Clunkers program are aware that the government’s $4500 “gift” is taxable.

[Flatout Phil]

Essentially this is pyramid selling. The economy is in pieces worldwide. The bill will come in eventually. It is disgraceful that having arrived in such a debt ridden situation as this (amongst many other nations) country is in, that we are encouraged to spend more of what we don't have. The chickens will come home to roost sooner or later, whatever you do. That is a law of economics. The world economy has over-inflated and no amount of pumping will stop it sagging in the end. Stick a few thousand corrupt bankers/lenders in the clink - that might actually do something useful: not least because 3/4 of Parliament would be in the jug too. In China they would be getting one in the neck.
As for the environment, if you want to be green and you believe it makes a difference, walk. I am sick of being foisted with economic and environmental lies by governments, the G8, etc, etc. David Icke may have some strange ideas about lizards, but goodness me, I am now taking a new look at some of his (as I used to think bonkers) ideas on global conspiracies. This global warming thing is top of the list. He has a fair bit on Youtube so check him out.

[daveforber]

Originally Posted by Flatout Phil

but just how much fuel could you buy with the thirty-odd thousand quid you saved NOT buying a new performance estate?

You asked and I was bored...

Petrol at £1.05 a litre.
£30,000 buys 28,571 litres of petrol at current prices
28,571 litres is about 6,285 gallons
At 40mpg, that takes you about 250,000 miles
At 30mpg, that takes you about 190,000 miles
At 20mpg, that takes you about 125,000 miles

Which is 19 years ownership at 40mpg, going down to 10 years at 20mpg (assuming 12,500 miles a year)

Clearly that doesn't take into fuel prices rising, service costs, fixing costs, etc. But then in 10 years time, your £30,000 car will be worth about the same as your R is now and you'll have had to fuel it, so...

So I might sell my 2.0T and buy a T4 or a T5 for the scarcity

[cookie]

Originally Posted by daveforber

You asked and I was bored...

Petrol at £1.05 a litre.
£30,000 buys 28,571 litres of petrol at current prices
28,571 litres is about 6,285 gallons
At 40mpg, that takes you about 250,000 miles
At 30mpg, that takes you about 190,000 miles
At 20mpg, that takes you about 125,000 miles

Which is 19 years ownership at 40mpg, going down to 10 years at 20mpg (assuming 12,500 miles a year)

Clearly that doesn't take into fuel prices rising, service costs, fixing costs, etc. But then in 10 years time, your £30,000 car will be worth about the same as your R is now and you'll have had to fuel it, so...

So I might sell my 2.0T and buy a T4 or a T5 for the scarcity

I would guess that servicing costs etc will be little different, and you have ignored the fact that a new car will still need fuel, so in real terms its the difference between a new and current cars MPG, so deducuting that from the equation, we should be paid £1000 by government for NOT scrapping our cars (and road tax exemption )

[Flatout Phil]

Originally Posted by daveforber

You asked and I was bored...

Petrol at £1.05 a litre.
£30,000 buys 28,571 litres of petrol at current prices
28,571 litres is about 6,285 gallons
At 40mpg, that takes you about 250,000 miles
At 30mpg, that takes you about 190,000 miles
At 20mpg, that takes you about 125,000 miles

Which is 19 years ownership at 40mpg, going down to 10 years at 20mpg (assuming 12,500 miles a year)

Clearly that doesn't take into fuel prices rising, service costs, fixing costs, etc. But then in 10 years time, your £30,000 car will be worth about the same as your R is now and you'll have had to fuel it, so...

So I might sell my 2.0T and buy a T4 or a T5 for the scarcity

Because in 10 years time my R will almost certainly be worth much more than any car bought new through scrappage today will be by then!

[daveforber]

Well, there will probably be scare 'new' cars now that people won't buy because they're scared of the fuel economy, say an S80 V8, but yes, I think the point is well made.

I'm not good enough at maths to calculate in service costs and differences in mpg. A fuel-price adjusted figure (assuming a 5% per year increase) says you spend £30k in juice in about 15-16 years for 40mpg, 11-12 years at 30mpg and 8-9 years at 20mpg.

Now, my maths is a bit ropey, but my little spreadsheet reckons on 20 years to recoup the £30k spend and the saving on fuel if you bought a slow, yukky clattery 60mpg diesel vs your 30mpg turbo.

Maintenance still not included, but you've got to maintain the new one too, and they ain't getting any easier

Ergo, keep the old 'un and fix it up.

[Flatout Phil]

Originally Posted by daveforber

Well, there will probably be scare 'new' cars now that people won't buy because they're scared of the fuel economy, say an S80 V8, but yes, I think the point is well made.

I'm not good enough at maths to calculate in service costs and differences in mpg. A fuel-price adjusted figure (assuming a 5% per year increase) says you spend £30k in juice in about 15-16 years for 40mpg, 11-12 years at 30mpg and 8-9 years at 20mpg.

Now, my maths is a bit ropey, but my little spreadsheet reckons on 20 years to recoup the £30k spend and the saving on fuel if you bought a slow, yukky clattery 60mpg diesel vs your 30mpg turbo.

Maintenance still not included, but you've got to maintain the new one too, and they ain't getting any easier

Ergo, keep the old 'un and fix it up.

If only I could drive it so it would do 30 mpg - but it's no good, I just can't help myself

[-CHRIS-]

Originally Posted by Flatout Phil

Because in 10 years time my R will almost certainly be worth much more than any car bought new through scrappage today will be by then!

I love this thread!!

that is all.