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Any costing ideas in terms of running and setting up. At the moment I'm thinking $10-20m to set up and $4m to run each ignoring global fixed costs which I estimated at $10m for the whole group. I've no real idea so what do you think and is that ball part or off the field. As for cash - great to see it grow especially with all we are due from SEVUS. Puts us in a strong position going forward now. Taken all my potential worries out as well.
Mr Kell is very upbeat about the future - heres hoping
Pre-Close Trading Update Tanfield Group Plc, the leading manufacturer of aerial work platforms, is providing the following trading update prior to entering the close period ahead of its preliminary results for the financial year ending 31 December 2010, which Tanfield expects to announce in April 2011. Trading for the second half of 2010 was similar to that of the first half and in line with the Board's expectations. The Company continued to execute its strategy of cash preservation and net cash at 31 December 2010 was £3.6 million (30 June 2010: £2.2m). As outlined in the Company's announcement of 4 January 2011, Tanfield completed the disposal of the business and assets of the Smith Electric Vehicles division to Smith Electric Vehicles US Corporation; Tanfield's 49% owned associate company, on 1 January 2011. As predicted, the market for aerial work platforms stabilised in the second half of 2010, after a very difficult and prolonged period of recession. The Company has consolidated all its powered access products into the Snorkel brand which has been well received by customers. General activity in the construction industry remains low; however, the Board is encouraged by the positive sentiments emanating from the equipment rental sector, and is therefore cautiously optimistic that stabilisation may evolve into a return to growth in the mid-term. Darren Kell, CEO of The Tanfield Group Plc, said: "The return of stability in the aerial lift industry in the second half of 2010 allowed Tanfield to focus on enhancing its Snorkel product range and global sales channels." "Entering 2011, Tanfield remains debt-free, with a positive cash balance, a very strong product portfolio in powered access and an excellent international distribution network."
http://www.investegate.co.uk/Article.aspx?id=201102010700084160A
By chance yesterday I made a calculation of additional world-wide electric generation requirements to meet electric car recharge needs over the next 10 years. This in relation to Hyundai Motor's planned take over of Hyundai Engineering and Construction. By 2021 I estimate there will be a total of 180m electric vehicles on the world's roads.. needing an extra 56 GW of electric power generation. That's 56 1GW nuclear power stations (around 2 times Germany's current total wind power generation capacity) . You can see where Hyundai are coming from in their vertical integration and I can see that photomic1962 has grasped the issue of taxing this extra pollution.. guys, BEV (battery electric vehicles) are emissions friendly, but only move the pollution upstream.
I love the idea of state by state assembly facilities, if for no other reasons than it sends a good environmental message and it is a means of accessing state funding. BUT having run multi-site organisations myself, I know that fly-by-wire sites require significant supervisory and engineering staff.. in order to wring maximum productivity, assembly quality .. not to mention troubleshooting needs.
http://share.com/mifidreview what do you make of this, it might stop us dealing on the AIM
:O
You are right, though once the revenue starts to significantly reduce at the pumps because of electric cars, the Government will wear the other hat.......with the horns. Those zero rated cars will have a huge whack put on them or as you say, one will be charged by the mile to the equivalent of the average MPG of a petrol car. Say, 10p per mile...tracked. There could also be an anti-tamper BlureTooth sensor built into the plug of the vehicle which 'jigs' your electricity bill to recognise a direct payment to the HMRC Coffers as to how long you spend charging it. Watch the sales of generaters soar! However, if you line the roof (inside) with a thin lead sheet under the roof lining, etc. (Like film bags through Airports), it MAY not be possible to track. An anti-track jammer will be sold in the US, illegal to use but not illegal to sell. (The Death sentence for motorists will be common place!). Two things: Consider the prison sentence of 5 years if caught (uk) and massive fines if you flout the Law, failing that: Vive Le Revolution! In France, they will get away with it, over here, we public are too soft! It will happen. Cars that use Fuel Cells will have a stonking duty put on them, but whatever, they will tax the shirt off your back until no-one has any money left to pay tax with, then what? GLA!
I dont understand your "Frozen out" comment. Tan own 49% of SEVUS. Do you really believe that SEVUS have the legal capacity and appetitie to go through an IPO without TAN's support and agreement ? Tesla are a different animal and have no relervance to TAN. They make Ferrari price cars that will never appeal to the Mass market. By the time Tesla have the economies of scale to supply your average Audi that charges in 4 minutes, Audi Honda Ford and Toyota will have stepped in with stuff they have in development now. Remember, there is the whole issue of taxable travel to consider. Whilst the government is happy to offer grants to drive EV's this is simply a bit of window dressing to keep the Green campaigners happy. Behind the scenes, there working furiously at a plan to charge the motorist when they lose the ability to do that at the pump. Hydrogen allows you to do that electricity does'nt. 10 years and we will all be tracked and paying per mile based on the roads we use. Sorry for digressing lol . .
So far I'm thinking labour costs $40k * 50 = $2m per plant for the first shift of staff. With admin centralised you don't have much else in fixed costs per plant. At most it's $4m per plant and that's surely got to be conservative. So fixed costs across the new 20 plants if they happen of $80m. So we'd need gross profits of $3,333 per bus and anything above that as profit. Make $5k per bus and you've got profits of about $40m and if you make $10k per bus you have profits of $160m. Definite upside if they can make a good margin, but we'll need at least 5% gross profit margin so costings need to be spot on. If it was all we owned it would be valued at $83m as a business so if the expansion is successful and we can cut costs using the new production system to make $5k gross profit per truck then profits would be pretty good against current buy in cost. The beauty of the plan is that to add a second shift increases fixed costs by $2m*0.8=$1.6m (only 40 staff), without adding other fixed costs of running a factory as you use the same factory. So full fixed costs of $5.6m, making 48,000 buses a year (twice as much), so you'd need to make $2,333 per bus and if you made $5k per bus you would make $128m, whilst if you made $10k per bus you would make $368m. It's a nice model once you scale up. The big question is: can orders be met and can it be successful when it is not scaled up. If both are yes, it's a bit of a no brainer.
High spread won't be any good for day traders (which we don;t need). At least it's closed up nicely today. GL all for Tomorrow.
Well if BH is right we're looking at a gross profit of potentially 24,000*x (24,000=100*12*20). So I guess what matters is how much is costs to run a factory. For a gross profit of about 1% ($1,000 per sale) you need it to cost at most $1m to run a factory to make a small profit. For a gross profit of 5% ($5,000 per sale) you need it to cost at most $6m to run a factory to break even. For 10% you need it to cost less than $12m. I think some work on factory costs is in order and I shall be back with a rough figure.
No one will be sad! --Interesting BH was here last week?? Only thing getting built here is LEGGO Models, Even then the Gaffer has to cheat. Ah well.
I doubt the UK side is comparible. The interview gives expected volume so the margin is the key to the plans. There must be one else they wouldn't be doing it.
Does anyone have any idea on the margin that is made on the SEV trucks (gross profits)?
http://www.investegate.co.uk/Article.aspx?id=201101241148119649Z
http://www.businessweek.com/technology/content/jan2011/tc20110120_063762.htm
While on the subject of order books....... There is a general perception that the construction Industry is picking up and I'd be interested to know if the AWP side of the business is starting to improve? I guess all will be revealed when the year end results are released and in the meantime we have the SEV IPO float to look forward to?
Selling 1000 trucks for 2011 is a realistic target and would be a good start, while some of the new regional production facilities are created. How many of these regional facilities that will be fast-tracked, will depend upon a solid order book..... Alas, as far as I'm aware, there has been no official news on any large meaningful orders? Other than the unconfirmed Frito Lay rumour, is anyone aware of any other solid orders?
Hanover show from last year showing Smith Edison with a PPS Power Range Extender http://www.h2fc-fair.com/hm10/exhibitors/proton-motor.html ATB (G)
So where's the TAN/SEV PR on all this? If this information is firm enough it comes under the heading of Material Disclosure for RNS purposes. Why isn't this in the press?
Yes I did hear the interview though I thought it was fairly benign. i.e. one convert talking to another. What I'd really like to see/hear is an interview with BH (an impressive communicator) addressing tough questions on investment costs, unit sales breakeven schedules, a firm order book etc. The short haul electric vehicle story is a gimme. But we need to see bulk orders. This is the main reason why TAN failed in the first place - a great story which didn't convert to sales. That said BH seems to me to be the man to carry this forward. I'm staying in. Hopefully the SEV IPO prospectus will drive us forward.
Good threads. Where does the figure of 20 new plants come from? I would have thought fewer larger units suited this kind of engineering operation. But Hansel certainly seems to be getting things moving.
If 2.6 billion is 2600million wouldn't tan own 25% (650million) after IPO. If things go to plan that is.