Maplin administration

[melmerby]

I believe a tangible example of this (and reasonably relevant to this Forum) is the fact that modern trains are designed and built for export in Germany by German companies but are not built for export in Britain by British companies even though in times past British companies built trains for the world. It's not as if Germany is a cheaper place to build things.

 

...R

One of the problems of Multi-Nationalism. (e.g. The Global Economy)

AFAIK no major UK manufacturer of railway products has taken over a foreign company.

Plenty of UK businesses have been taken over by foreigners.

When some cost cutting is required the first bit of the business to go is the non-native bit.

Could you really see Alst(h)om closing a French factory in preference to Metro-Cammell?

PSA did the same thing with the car factory in Coventry. They closed that, even though I believe it was profitable, rather than face flack back in France for closing/downsizing a plant there.

 

Keith

[rockershovel]

One of the problems of Multi-Nationalism. (e.g. The Global Economy)

AFAIK no major UK manufacturer of railway products has taken over a foreign company.

Plenty of UK businesses have been taken over by foreigners.

When some cost cutting is required the first bit of the business to go is the non-native bit.

Could you really see Alst(h)om closing a French factory in preference to Metro-Cammell?

PSA did the same thing with the car factory in Coventry. They closed that, even though I believe it was profitable, rather than face flack back in France for closing/downsizing a plant there.

 

Keith

Exactly. The idea that the EU exists for mutual benefit is wholly mistaken.

 

Somewhere around 1965, British industry lost the ability to create positive cash flows. There were various reasons for this, but the loss of Empire, the long post-War boom which led to the hardening of the corporate arteries, and the breakdown of R&D were all reasons. The steam locomotive industry was one of the first to go; what happened to North British? Loss of Imperial markets and a complete failure to adapt to diesel or electric traction quickly finished them off.

 

Motorcycles were quick to go, in the 1960s. All major manufacturers were committed to design types which essentially dated from the 1930s, in some cases designed by the same people. Major innovations, available for the asking, were cast aside (Honda, Yamaha and Suzuki in particular would make extensive use of work done by DKW, such as two-stroke induction cycle technology and welded pressed steel frames). British cars of the 1970s really WERE that awful; but why?

[jjb1970]

I think Clearwater has already made the point, but I see the demise of Maplin and other high street retailers much more as a sign of evolution in the retail sector than as being indicative of the evils of capitalism. The sad or positive truth (depending on perspective) is that many items sold on the high street can be bought more cheaply and with vastly more consumer choice on-line and with very slick delivery and service, the question is unless people enjoy walking around shops (and clearly some do) why bother going to the high street or an out of town industrial unit if you can access a lot more choice from your smart phone or other device? That's got nothing to do with evil venture capitalists or tobin taxes, it's just evolution in retail. Sad for the workers obviously but nothing stays fixed and all industries change.

[Clearwater]

Surely the idea of the tax is to kill all the trading that exists purely to extract profit from such small price movements.

Regards

So basically you want to ban something you morally don’t approve of which has a benefit to the wider market?

[Clearwater]

Because the liquidity has become an end in itself that is almost entirely divorced from considerations of how business is managed.

 

The problem is that people are making decisions because of the liquidity that they would not make without it. And if some companies can't raise capital maybe that would be a good thing. Some share issues are a thinly veiled exercise in printing money.

 

I recognize that transition from one system to another needs to be managed. But I don't believe that is impossible if people want to change.

 

I have no objection to the idea of a person owning a piece of a company and being rewarded with a dividend. I do object to a system that allows people to make profit from bits of paper - or bits in a computer database.

 

...R

So it’s a moral objection to share trading? I refer to my comment above: Where do you find the replacement for the £3.3bn in direct taxes paid by such trading? You fail to understand why liquidity is important. To ask the question in model rail terms, would you prefer to sell your collection at a local car boot sale or on eBay?

 

Sure the principle of company value is npv of dividends but a start up company with high growth has a different risk profile to a multinational paying a regular dividend. That growth stock is not be suitable to pay annuity pension income but may suit a younger investor who wants capital growth. It takes time and skill to understand which growth stories are credible. It’s only natural to want to realise a profit once the growth has occurred.

 

I really don’t understand the point you are trying to make about management decisions. It seems to me to be a non sequitur to understanding liquidity.

 

Personally, I think it would be a really bad thing if we made it harder for companies to raise capital. The market already has failed IPOs and share issues (most recently think of Carillion who were unable to raise money.

[Jol Wilkinson]

One of the problems of Multi-Nationalism. (e.g. The Global Economy)

AFAIK no major UK manufacturer of railway products has taken over a foreign company.

Plenty of UK businesses have been taken over by foreigners.

When some cost cutting is required the first bit of the business to go is the non-native bit.

Could you really see Alst(h)om closing a French factory in preference to Metro-Cammell?

PSA did the same thing with the car factory in Coventry. They closed that, even though I believe it was profitable, rather than face flack back in France for closing/downsizing a plant there.

 

Keith

 

Keith,

 

I worked for PSA and the closure of Ryton was an economic decision. It was originally built as a WW2 "shadow plant" opening in 1940. It stayed in car production for longer than was really practical and wasn't as productive or efficient as continental factories owing to its layout and other factors. It was profitable while producing the 206, but with production of that model coming to an end, it needed considerable investment in the first decade of this century to update the plant, including the paint facilities (partly to meet new legislation on emmissions).

 

PSA approached the UK Government for support, but none was forthcoming. Looking at the timeline it is worth noting that the PSA/Toyota joint venture plant in Czechoslovakia opened just over a year before Ryton closed. It was said that the  Czech government had provided a grant of 50% of the cost of the new factory (probably from EU funds, which they joined in 2004). The then head of PSA, J M Foltz, wanted to keep UK production going, but the economics dictated otherwise. The support sought from the UK government was relatively small (£17.0M I believe) to maintain jobs around Coventry, but making things had become unfashionable in our "service" orientated economy. Not only did Ryton close, but also the PSA support operations such as Hills Precision who had also supplied JLR, Ford and others but who weren't viable without the requirements of the PSA plant. 

 

The Ryton site is a now a distribution hub, while the old Humber Road plant is a housing estate.

 

Jol

[Horsetan]

....When some cost cutting is required the first bit of the business to go is the non-native bit.

Could you really see Alst(h)om closing a French factory in preference to Metro-Cammell?

PSA did the same thing with the car factory in Coventry. They closed that, even though I believe it was profitable, rather than face flack back in France for closing/downsizing a plant there.

As it happens, PSA still ended up closing their plant at Aulnay-sous-Bois.

[Bernard Lamb]

I believe a tangible example of this (and reasonably relevant to this Forum) is the fact that modern trains are designed and built for export in Germany by German companies but are not built for export in Britain by British companies even though in times past British companies built trains for the world. It's not as if Germany is a cheaper place to build things.

 

...R

 

It is rather more complex than that.

Kato make German outline models to sell in Germany and other markets.

I do not see them looking at the UK market and building UK prototype models.

It is a matter of the size of the market and the attitude of that market in respect of a willingness to pay a fair price for the product.

Bernard

[Jol Wilkinson]

As it happens, PSA still ended up closing their plant at Aulnay-sous-Bois.

 

Ivan

 

apparently due to regular and persistent industrial relations problems.

 

I once briefly visited a PSA plant in France with colleagues in the mid 80's and we commented on the fact that it still carried Talbot signage. It may well have been Aulnay (we were driven there by a French colleague so were a bit lost when we arrived). We queried  the Talbot branding and were told it had been retained so that, in the event PSA shut it down it was a Talbot, not a Peugeot factory.

 

Looking at the major producers and brands in UK motor industry today, it is either Japanese, Indian, Chinese, German or French owned. So little chance that any decisions about the future of manufacturing in the UK won't be made on economic grounds.

 

Jol

[rockershovel]

Mention of Ryton being an obsolete, 1940s-era plant only begs the question; why was such a plant still in operation, at such a late stage?

 

The British authorities controlled VW between 1945-1949 and could have had it for the asking, as they did the little DKW 2-stroke motorcycle which BSA (and incidentally, Harley-Davidson) would make profitably for many years. They didn’t, and we know the rest. VW in turn would see opportunities where the U.K. saw none, and invest in Skoda (with a very material contribution from EU funds) and we know the rest of THAT.

 

The only conclusion I can draw, is that British management, fully supported by British political elites, wouldn’t recognise a good product if it ran up and bit them in the leg. Hence the obsession with money-shuffling, a self-defined field which offers the dazzling mirage of return without investment or the need for actual skills (Nick Leeson’s book Rogue Trader offers a scathing portrait of this sort of thinking, right down to the “dazzling brogues and Lapsang Souchong” in the Barings boardroom. Lesson was undoubtedly an unreliable witness at best, but SOME enormous failure of management must have occurred over quite a long period, to destroy the company so completely and suddenly).

[Horsetan]

Ivan

 

apparently due to regular and persistent industrial relations problems.

Yes, they replaced that with unemployment and disaffection in the surrounding banlieues. Frying pan and fire springs to mind.

 

I once briefly visited a PSA plant in France with colleagues in the mid 80's and we commented on the fact that it still carried Talbot signage. It may well have been Aulnay (we were driven there by a French colleague so were a bit lost when we arrived). We queried  the Talbot branding and were told it had been retained so that, in the event PSA shut it down it was a Talbot, not a Peugeot factory.

My own interest in the Aulnay plant is because it built the CX so, er, vested interest, sort of.

[Jol Wilkinson]

Mention of Ryton being an obsolete, 1940s-era plant only begs the question; why was such a plant still in operation, at such a late stage?

 

The British authorities controlled VW between 1945-1949 and could have had it for the asking, as they did the little DKW 2-stroke motorcycle which BSA (and incidentally, Harley-Davidson) would make profitably for many years. They didn’t, and we know the rest. VW in turn would see opportunities where the U.K. saw none, and invest in Skoda (with a very material contribution from EU funds) and we know the rest of THAT.

 

The only conclusion I can draw, is that British management, fully supported by British political elites, wouldn’t recognise a good product if it ran up and bit them in the leg. Hence the obsession with money-shuffling, a self-defined field which offers the dazzling mirage of return without investment or the need for actual skills (Nick Leeson’s book Rogue Trader offers a scathing portrait of this sort of thinking, right down to the “dazzling brogues and Lapsang Souchong” in the Barings boardroom. Lesson was undoubtedly an unreliable witness at best, but SOME enormous failure of management must have occurred over quite a long period, to destroy the company so completely and suddenly).

 

Ryton continued in operation because the management, led by Geoffrey Whalen, made it efficient and cost effective. It finally reached the point when, not having been specifically designed for car production, it needed considerable investment to upgrade it. In the face of grants available in other, developing, low labour cost, EU countries it became no longer viable. It also was an assembly factory, with stamped panels and partly assembled drive train units imported from France.

 

It also gave Peugeot the opportunity to promote itself as a British manufacturer, at a time when many fleet operators wanted to buy British. That enabled the 405 to be sold into fleets in competition with Ford and GM.

 

It is worth noting that many of the major UK manufacturing plants of the post war period have closed.  Dagenham, Browns Lane, Luton (now vans only), Ryton and Fords Southampton Transit plant. Longbridge assembles a few MGs, Abingdon is owned by BMW while Nissan, Toyota and Honda are all newer plants based on more recent manufacturing processes. 

 

While your comments about UK management are valid for some, we should also reflect on the part various governments have had on UK industry. Starting with Thatcher, manufacturing became unfashionable, although she made the UK an another Japanese island for their car industry with "support" the UK manufacturers were denied. The immediate post war period also stopped investment in the car industry (much like the railways and ship building), which coupled with the Unions attempt to keep the clock stopped with industrial relations didn't help either. The fact that we also tried to continue as a "world Power" with our own weapons programmes meant that many of the brightest scientists and engineers were employed there. The Germans and Japanese on the other hand, not being allowed to play at Cowboys and Indians, put their scientists and engineers to work in the manufacturing industries.

[Clearwater]

Whilst the Uk doesn’t make some of the visible headline products of old, there is still a vibrant manufacturing sector. Look at names like Rolls, pharma sector etc. The link below is interesting:

 

https://www.eef.org.uk/campaigning/campaigns-and-issues/manufacturing-facts-and-figures

 

I don’t doubt the uk needs to do more in investing in skills and creating an environment to encourage cash investment but I think it’s a mistake to hark back to the 30s-50s and say why aren’t things like they were.

 

It’s also possible to play games with stats. because services has grown quickly and at an above average rate, necessarily even if manufacturing grows, it’s percentage as a proportion of total gdp will fall. That doesn’t mean manufacturing is doing badly, just that the uk economy has diversified.

[Robin2]

Exactly. The idea that the EU exists for mutual benefit is wholly mistaken.

I am a strong supporter of the EU and I beleive that is nonsense. If everyone is in the club working together there is no problem.

 

And any warm-cuddly notion that Brexit will solve the problems has been completely scotched by the decision to get British passports made in France. It is all just a race to the bottom. The "bottom" within the EU was not low enough.

 

You fail to understand why liquidity is important.

I rather think that you fail to see that I believe it is not so important as to require the sort of cut-throat market that now exists.

 

To ask the question in model rail terms, would you prefer to sell your collection at a local car boot sale or on eBay?

If eBay did not exists the car boot sale would be fine.

 

It is rather more complex than that.

Kato make German outline models to sell in Germany and other markets.

Sorry for not being clear. I was referring to Siemens and real trains, not models.

 

...R

[Titan]

 

It’s also possible to play games with stats. because services has grown quickly and at an above average rate, necessarily even if manufacturing grows, it’s percentage as a proportion of total gdp will fall. That doesn’t mean manufacturing is doing badly, just that the uk economy has diversified.

 

Indeed, I believe the reality is that we are manufacturing more than we ever were - certainly true of the car industry.  The problem is that manufacturing output is expressed as a percentage of GDP. What this means is that if manufacturing grows by 5%, but the service industry grows by 10%, then despite its growth, manufacturings percentage of GDP appears to have fallen. This has been happening for some time...

[Clearwater]

eBay has a global reach and thousands of potential buyers. Hence you’re more likely to achieve the best price for your item relative to a poorly advertised car boot sale. You won’t get best value from selling at the local car boot sale. However, what you will get is traders looking to pick up bargains to resell into more liquid markets. Look at the likes of Gostude on eBay.

 

Financial Market liquidity- I’ve never met a finance professional who’s argued that less liquidity makes for a better market. Some would prefer less but that’s usually because that creates a bigger opportunity for them. Generally the more liquid a market, the tighter the spread and the more transparent the price to the end user. Isn't that a posiitve?

[Robin2]

Financial Market liquidity- I’ve never met a finance professional who’s argued that less liquidity makes for a better market.

Well of course not. That's like asking a Bishop if God is a myth.

 

Ask someone who does not have a vested interest.

 

...R

[Clearwater]

Well of course not. That's like asking a Bishop if God is a myth.

 

Ask someone who does not have a vested interest.

 

...R

You could equally argue that a professional is a person who has the best and deepest understanding of the issue in question. Merely because you don’t like the industry in question, doesn’t mean that their professional judgement is wrong. I certainly wouldn’t wish to argue theological points with a person who’s studied theology for 30+ years and reached the pinnacle of their profession.

 

We all have a vested interest. For example, if a company is importing /exporting and is looking to fix its cost of production by buying forward fx (a sensible strategy), if liquidity decreases then the cost of goods and inflation increases. directly or indirectly, you will use a number of financial products and implicitly depend on the supply chain that gets you to that point.

[Grovenor]

try your local library, if you are lucky enough to still have one, and read the books by Robert Peston.

Regards

[Classsix T]

A myth is a female moth. Everybody knows that.

 

C6T.

[jjb1970]

The idea that less liquidity is good for an economy is a very odd one. If people want to see what happens when liquidity dries up then there are some excellent examples in recent history, particularly the Asian economic crises of the late 1990's. Liquidity evaporated almost overnight (quite literally) in several Asian countries with dreadful effects for those countries and their inhabitants. And despite the obvious pleasure that some see in these events as they imagine it is greedy profiteers getting their comeuppance the biggest losers are invariably ordinary people living and working in the "real" economy and who often do not recognise the link between the financial markets and their own lives. I was in Indonesia at that time and it was brutal, it led to some properly awful social unrest and an economic implosion, it made the years following the 2008 crises in our country look like a walk in the park and quite a sunny time by comparison.

[melmerby]

A myth is a female moth. Everybody knows that.

 

C6T.

What's a married one called?

 

Keith

[melmerby]

Maplin have upped the discount on many lines

 

In Birmingham Today:

50% off components

40% Kits (Velleman/Arduino/Pi etc.)

30% Many other items.

Strangely ordinary computer Keyboards and Mice are only 10% but gaming kit (Including Keyboards/Mice) is 20%

 

As I found out these discounts are not off the shelf price but the notional recommended price.

I bought an item that was on a 40% off shelf but as it was already on offer with a 10% discount I only got another 30% discount.

 

There were a lot of Corsair PC power supplies, which weren't there before (20% off). I wonder whether some warehouse stock has been shipped in?

 

The salesman said the shop just has weeks to go before closure.

 

Keith

Edited March 22, 2018 by melmerby

[Robin2]

You could equally argue that a professional is a person who has the best and deepest understanding of the issue in question.

It is vitally important not to forget that professionals are human and are subject to all the human frailties - including greed and the need to believe they are doing something vitally important to society.

 

Just because someone has a degree or a doctorate does not mean they have common sense.

 

...R

Edited March 22, 2018 by Robin2

[APOLLO]

This from BBC news. This will be interesting.

 

http://www.bbc.co.uk/news/business-43494001

 

Brit15