Last post on Jan 28, 2013 at 5:55 PM
You are in the Sedans
What is this discussion about?
Audi A8, BMW 7 Series, Jaguar XJ-Series, Lexus LS 460, Mercedes-Benz S-Class, Volkswagen Phaeton, Maserati Quattroporte, Mercedes-Benz CL-Class, Sedan
Let's try to define this forum as being limited to luxury performance vehicles where the mainstream version in a typical configuration has an MSRP of at least $60k.
A luxury vehicle with a base price of $59k qualifies because it would typically be bought with some additional equipment, bringing the MSRP over $60k.
Vehicles like the E, 5, A6, M, or GS, even if available in certain versions over $60k, don't qualify because they are cars from companies that have higher end cars in their lineups.
#10923 of 24726 Re: CEO picks for cars [dewey]
Oct 26, 2005 (9:54 pm)
So I guess your experience with your one Matrix disproves that whole myth about Toyota reliability? Thanks for the clarification!
C'mon.... You claim that the Matrix is renowned for its reliability, blah blah blah... Then I tell you that the Matrix which began life in the spring of 2002, 3+ yrs ago is not a car to be called renowned in anything, maybe cargo space.... Then you turn it around like my Matrix experience is already a myth about Toyota reliability ? C'mon man....
Americans instead buy a LS from a luxury dealership called Lexus. Buying any car from a luxury dealership is not an act of modesty nor is it being "stuck up"!
First you claim "innocent until proven guilty", and then you try to rub it in that buying a luxury car is itself an act of snobbery ! Wonder why you drive a BMW and not a Kia ? Or why your wife drives an MB and not a Hyundai ? Were these family cars purchased because of their snob appeals ?
I'm off this wagon cos its leading nowhere....
#10924 of 24726 Re: luxury and reliability [syswei]
Oct 26, 2005 (10:07 pm)
Take heart. Both of my Rolexes keep lousy time....
#10925 of 24726 Re: Reliablity Viral Contagion! [brightness04]
Oct 26, 2005 (10:28 pm)
That waitress would then be qualified for the so called "stated income" program, which is fine, but she'll need to show some asset to support her "stated income", in order for 45% to 50% ratio to fly. I was actually referring to full doc loans. On stated deals, lenders are still hesitant to go up to 50% DTI ratio.
On the super-jumbo you mentioned, a lot of lenders will still lend up to 45% DTI ratio on multi-million dollar loans, of course the LTV has to be low and you'll need compensating factors, but it's definitely not rare, a lot of these super-jumbos have ratios around 40-45%... and of course, these burrowers tend to have the so called "Option ARM" loans, in which they can choose a negative amortizing payment, of course I won't get into details about it in this forum.
I would agree with you that you have to be in the top 1%, or making about $500,000 a year to comfortable own a say, Gallardo, but that's because I factor in the maintenance. The same applies to someone who makes $50,000, but can somehow manage to stretch and buy a BMW 330. If you make $250,000 a year, you can stretch and buy a Gallardo, but the Gallardo is actually a whole lot more expensive due to maintenance, depreciation, and service costs, hence my conclusion, if you make $250,000, you can afford to buy it, you just can't afford to run it. While the 330, although expensive, is not too costly to maintain and upkeep, so you see more people making less than $50,000 but drive a $40,000 car.
Lastly, here's why I think you have to make $500,000 a year, to comfortablely afford and run a Lambo Gallardo. Your take home pay a month is about $23,000, you pay $6,800 in principal, interest, tax and insurance on your $1.35mm home. You spend about $3,500 a month for everything else, another $900/month on your Mercedes, another $800 on your Lexus. It's wise to have an investment property/second home, in which you have a $300,000 mortgage on, and the net cost after your rental income is $1,000/month. Your Lambo's monthly payment is $2,000, and another $1,000 to $1,500 depending on how much you drive, that still leaves you with $7,000, and if your CPA is a crook, you'll have about $10,000 left.
Of course, everyone has their own view. My co-workers in between the income level of $500,000 to $1,000,000 don't own any of these exotics.
#10926 of 24726 Re: Reliablity Viral Contagion! [gshocksv]
Oct 26, 2005 (10:41 pm)
"You can probably find unwary 45,50% suckers buying $200k condo or starter homes on their way to their first bankruptcy, but the loan payments for million-dollar-plus homes seldomly take up 45,50% of pre-tax income of the borrower, unless the guy works for the mob (in which case he'd be paying with cash anyway). "
Oh, and I want to add, the DTI (debt to income) ratio, actually doesn't have much to do with whether someone will be able to make his/her payment on time. Back in the 80's, DTI was the number 1 info that an underwriter check, and anything over 38% is an automatic decline.
Now days, lenders weight a lot more on LTV, credit score, and assets. I've seen DTI in the range of 57%... and we still bought the loan... it's called risk based pricing. Contrary to popular belief, lenders do not want to foreclose on your home, the cost of a foreclosure is substantial for a lender. Go check with your local real estate broker and you'll know....
#10927 of 24726 Re: Reliablity Viral Contagion! [gshocksv]
Oct 26, 2005 (10:45 pm)
I think we are in general agreement. It takes an income level well inside the top 1% club to afford one of those beasties.
A bit off topic, interesting to know that borrowers of over a mil tend to go for "Option ARM"; are you talking about developers/flippers or actual buyers who intend on living there for the long haul? I see nearly two dozen million+ housese empty within a few blocks of where I live; waiting to pick them up on the courthouse steps someday . . . wife wants a house upgrade, and that's the only way I can afford one of those beasties.
#10928 of 24726 Re: Reliablity Viral Contagion! [gshocksv]
Oct 26, 2005 (10:47 pm)
I know, in a rising market, foreclosure is a waste of time . . . the picture is different in a declining market; lenders would have a much stronger incentive for locking in value.
it's called risk based pricing.
"Junk bond" is just an unflattering vernacular term for high-yield bonds. Historically, the yield differential between residential mortgage-backed security and commercial loans had been tremendous, a rich ground for arbitrarge indeed as people start to buy houses to turn a profit instead to live in.
#10929 of 24726 Re: Reliablity Viral Contagion! [killerbunny]
Oct 26, 2005 (11:34 pm)
LOL, you justify your point by 1 year of great sales? My bad on using the wrong words. Actually, these marques were dead long ago. Only some CEOs were fanatic about these cars and thus bought them at the expense of the employees. Example: this year, 2005, Bugatti Veyron is finally rolled out with many titles like being the fastest and the most expensive. This same year, VW lays off more than 20,000 workers in Germany.
Yeah, my point being they aren't dead. They're on the comeback after years and years of neglect and fumbling. I agree about VW, but now the Piech isn't running the show they'll forget about this luxury car nonsense. That Bugatto project has to be the most awesome, but pointless and ill-timed car ever made! Engineering to death, but at what cost. Meanwhile we get base Jettas with a crap engine. Yes its all true.
As far as what makes a sounds business I'm not arguing about because Ferrari and Aston, hell just about every European carmaker has teetered on death a few times so they aren't business leaders in that respect. I'm not sure what you mean by Aston-Martin is no longer British. They are as British as British can be. They're built and engineered in a brand new facility in England, only their engines are built in Germany. Yes their V12 did start out as a 2 Ford V6s, but I dare you to find one common part and I double dare you to tell me you hear any Ford in a Aston V12 upon start up, full throttle or idle. The Ford DNA has long been engineered away.
In the United States, the most profitable marques (in terms of profit per car/suv) are Porsche at No.1 and Lexus at No.2. Is it a surprise? BTW, the most profitable company overall is Toyota, whose market value is No.1 in the world and more than double of GM and whose profit is more than the big 3 combined (if they do have a profit).
Who cares? Sorry I can't get excited about this, its very, very, very old news and no one here was comparing any of the ultra-luxury brands to any of Toyota or Porsche. Totally irrelevant. You stated that Bentley, Ferrari, Aston-Martin, Rolls, Maybach etc were did and they aren't - thats all I'm debating here so please spare us the Toyota speech. Its silly to compare such tiny brands to Toyota on a profit basis anyway.
#10930 of 24726 Re: Reliablity Viral Contagion! [gshocksv]
Oct 26, 2005 (11:38 pm)
I think we can go back and forth on this, I do agree with many of your points, but ultimately, I think reliability is the number 1 issue that these brands had to work on, and it's not just simply sorting out all the bugs, but changing people's perception of its reliability. Poor reliability means poor resale value. Let's admit it, a lot of these rich people can afford to buy these luxury cars, but they still hate to lose 50% of the value after a few years. Also, in reality, a lot of people in the nation's top 3% income bracket can afford the lower end of these premium brands, but they just can't afford to run them.
The only problem is that there isn't any mass tracking of reliability for brands such as Ferrari or Bentley. Secondly all of these cars take huge hits in resale, except the rare Ferrari here and there. Resale values and reliability are not part of the reason why people buy Astons, Bentleys and the like. These cars are toys for the rich and aren't subject to all this reliability talk. They might hate to lose 50% of the value in 3 years, but its been happening since the beginning of time and yet when a new Aston, Bentley, Ferrari etc. appears it sells out. Ferrari in particular sells every one of the 4000 cas they build every year. Every single one of them.
Regarding Ferrari I'll go with the reliability theory, but with Bentley, Aston and Lambo its price, price and price. They all have taken off nearly a 100K off the price of admission to the brand. The Gallardo is roughly half the price of the Murcielago. That is the source of their comeback because editors still report Lamborghinis breaking down during roadtests. Magazines were only stating what they found to be the problem with these brands, not what the customers found - big difference.
#10931 of 24726 Re: Reliablity Viral Contagion! [brightness04]
Oct 26, 2005 (11:43 pm)
My god did you feel that? The earth has moved because we actually agree on something.
You're right Bentley won't be as exclusive in a few more years because like I noted earlier I never saw many Bentleys until the Continental GT came out, now they're everywhere! They won't be able to maintain the momentum forever and at some point down they road they'll slow down, unless they go cheaper - something the current Bentley chief is against. They're even talking about making a Bentley SUV to keep things going at the current pace, a mistake imo. Personally, the only "Bentley" to me is the Arnage and upcoming Azure.
Selling on "exclusivity" is not a sustainable marketing position; that's why practically all the brands selling on that point are owned by one mass merchandizer or another.
I agree. This is why all of them belong to a much bigger entity. I'm just thankful that VW, Ford, and BMW value these brands enough to let them thrive.
Now how does GM fix Saab?
#10932 of 24726 Re: is this the high end timepiece discussion?? [oac]
Oct 26, 2005 (11:47 pm)
BTW, there are more Maybach's on limo linesin posh hotels than on driveways. What a disaster from MB.... And how much better to point to failure than to re-design your high-end S-class in the mold of the failed Maybach experiment. What were they thinking ?????
The difference that you're not seeing here is that the Mercedes S-Class is a known product, unlike Maybach. The S-Class will have a certain amount of buyers no matter what it looks like. Secondly the Maybach is overpriced in addition to being an unknown. They remain totally different cars and more importantly they're in different market segments. Maybach (and Rolls) developed these mega dollar monsters during a time in which the sky was the limit. Remember the Maybach concept first appeared at the Tokyo autoshow back in 1997. A lot has changed since then and they both overestimated the market for 300K cars. Rolls will always be Rolls, whatever that may mean to its buyers, but Maybach is a virtual unknown which is a huge problem for them.