Zoom, sputter, aagghhh!! The biggest loss-making cars in Europe

September 27, 2013 Leave a comment

Zoom, sputter, aagghhh!! The biggest loss-making cars in Europe

Sep 25th 2013, 13:27 by S.W. and L.P.

CARMAKERS in Europe are facing a rough ride, with sales at a 17-year low region-wide. So it seems cruel of Sanford C. Bernstein, a brokerage, to remind them of their biggest commercial wrecks. Most major makers suffered billions in losses. Yet not all cars failed by accidents of poor design, ill-judged technological leaps or wildly optimistic production forecasts. VW knew its Bugatti Veyron, a quick and complex supercar made in tiny numbers, would not make money but hoped it might burnish the brand. Daimler believed it could transfer know-how from its sleek executive saloons to small cars. It did—but it brought the same high costs too: its Smart Fortwo had the biggest loss. Renault produced reasonable cars but was overly optimistic about sales. Fiat failed to compete with the VW Golf. As for tomorrow’s pile-ups? Bernstein reckons that the latest bunch of electric cars could some day join the list.

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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