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Profits Crash at McLaren; despite boost from F1
Topic Started: Jan 10 2010, 12:10 PM (656 Views)
Brave_Lee_Flea
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Profits crash at McLaren despite boost from F1

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McLaren should have had a golden year financially in 2008. The team won the world championship with  Lewis Hamilton and, according to the group's accounts to 31 December 2008, which were released earlier this week, revenue from sales of its SLR cars increased 17.1% to £91.4m.

However, as business editor Chris Sylt reports in today's Express, despite these boosts, McLaren's bottom line crashed 40.6% giving the group an after-tax loss of £44m. Bearing in mind that McLaren was hit hard in 2007 by the £63.5m fine paid to the FIA for being in possession of Ferrari's blueprints, how on earth did its fortunes manage to reverse even further?
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Lord Tau
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Petra Lead,Jan 10 2010
12:10 PM
Profits crash at McLaren despite boost from F1

Quote:
 
McLaren should have had a golden year financially in 2008. The team won the world championship with  Lewis Hamilton and, according to the group's accounts to 31 December 2008, which were released earlier this week, revenue from sales of its SLR cars increased 17.1% to £91.4m.

However, as business editor Chris Sylt reports in today's Express, despite these boosts, McLaren's bottom line crashed 40.6% giving the group an after-tax loss of £44m. Bearing in mind that McLaren was hit hard in 2007 by the £63.5m fine paid to the FIA for being in possession of Ferrari's blueprints, how on earth did its fortunes manage to reverse even further?
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Wouldn't a £50 million fine impact profits a little bit?
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P1
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Lord Tau,Jan 10 2010
02:24 PM
Wouldn't a £50 million fine impact profits a little bit?

Think the £50 million fine was posted into the financial books already in 2007, as also mentioned in the article. So should not have any negative effect on their financial year 2008.

What is unusual is this: McLaren made a pretax loss of £42.5M on car manufacturing and sales in 2008 (despite increased SLR sales), sharply down from a loss of £3.5M the previous year. The reason according to their accounts is that the group spent £49M on R&D during 2008 despite no such programme had been formally approved by the board for this. It is said to be for the development of the MP412-C supercar, which was launched just this last September 2009.
Further reason why Mercedes decided to pull the plug and put its money in Brawn.
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Norbert
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Maybe Ron employed too many people to keep the gravel turned over in the fountains?
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Steelstallions
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How much did they invest in the road car division Ron is running? It might be expenditure for that rather than losing money. <think>
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AndyW76
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May be that is why McLaren and Mercedes are parting company and McLaren going it alone. The SLR doesn't seem to have been as profitable as first thought. But is could also as SS says, money put in for investment. Once the new road car is on the market, that investment will start to pay off.
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Steelstallions
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AndyW76,Jan 11 2010
12:04 PM
The SLR doesn't seem to have been as profitable as first thought. But is could also as SS says, money put in for investment. Once the new road car is on the market, that investment will start to pay off.

I have said this on other threads before, part of buying an expensive car along with image, build quality etc is the place you buy it from and service it.

Mercedes dealerships are plentiful and are a recognised brand, the sales team for the top end of the marque are well practised at giving the customer experience one would expect for the money these customers will part with.

Mclaren road cars like the F1 had all the attention and customer experience that calibre of customer could ever want. I remember when it was released and Top Gear mentioned how quick the Mcaren Engineers would come to your assistance if the car broke done. Quite easy when the car cost many zeros but the production line is minimal.

If you want to sell on the scale of Porsche and Ferrari and Aston Martin, you need the right dealerships in place.
If the SLR with the experience of a Mercedes dealership behind it does not do well, Mclaren need to think long and hard at who their target market is and the customer service they expect and how they will deliver that to a such a bigger market.

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sportsman
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Steelstallions,Jan 11 2010
06:27 PM

I have said this on other threads before, part of buying an expensive car along with image, build quality etc is the place you buy it from and service it.

If you want to sell on the scale of Porsche and Ferrari and Aston Martin, you need the right dealerships in place.
If the SLR with the experience of a Mercedes dealership behind it does not do well, Mclaren need to think long and hard at who their target market is and the customer service they expect and how they will deliver that to a such a bigger market. [/QUOTE]
Exactly that SS. Very few of these cars will end up on British roads.The vast majority of sales will be to oil rich countries.
Hong Kong, Russia or Arab countries.Some will end up on the French Riviera.That's a fair trip from Woking to repair it if it breaks down.
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John
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from what I remember the 1990's McLaren F1 had the ability to be connected to the factory for diagnostic checkups and some aspects can be set or altered by the factory in Woking... granted it cannot be fixed but any problems parts can be dispatched... at a cost of course.
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Rob
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Remote diagnostics shouldn't be any trouble for a company w/ the resources of McLaren. Honestly I'm surprised they don't have automatic diagnostics via wi-fi once a week.
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John
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for the price new of a McLaren SLR 772 or the 'Sterling Moss' edition I'd expect a McLaren mechanic to be flown out to me... <devil>
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sportsman
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John,Jan 11 2010
09:07 PM
for the price new of a McLaren SLR 772 or the 'Sterling Moss' edition I'd expect a McLaren mechanic to be flown out to me... <devil>

And stuck in the middlle of nowhere in the UAE you would be happy to wait that long.
I think not
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John
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err... well I would not expect McLaren to act as a breakdown service, just a repair service... I'd still need the equivalent of the AA/RAC to get me home...

of course if I was an oil rich Arab I'd just leave the broken SLR were it stopped and go buy a new unbroken one... <angel>
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Brave_Lee_Flea
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sportsman,Jan 11 2010
07:00 PM
That's a fair trip from Woking to repair it if it breaks down.

Reminds me of a time when a friend of mine managed somehow to snap the frame on his Suzuki GSXR. He took it back to the dealer and the following week went back to collect his bike. He asked if they had repaired the frame or if they had replaced it.

"Neither" he was told.

So he asked "How did you fix the snapped frame then?"

"Sir, Frames on Suzukis do NOT snap."

I'm sure too that McLaren super-cars will NOT break down.
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John
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I like it...
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