Meridian Unplugged - Powered by MrTechGuy.co.uk Forums Discussion Meridian - Systems Will Meridian survive?

Listening to Radio 4 today the 'experts' were talking of the drop if not complete stall of demand for luxury goods.
Meridian I'm pretty sure would be classed as a luxury purchase!
With Meridian losing �3 million last year on a turnover of �10 million, I can only see it getting worse over the next couple of years.
I know that they may have some well financed support, but how long will that continue with a loss making business, especially with the losses that many may be experiencing in their other investments!
I would imagine some Hifi shops will be going out of business and I already know of one very large car dealer network on the verge of going bump.
No one seems immune and if Meridian are losing money in a good market what will happen in the current environment?

Given Arnon Milchan (Muse Consortium) (a) thought Meridian could be a billion dollar business and (b) was worth $3B at the last count, I doubt that Muse will let Meridian fail in the short term. I think this year, Meridian will see the effect of a *lot* of F80 sales on it's P&L.

I've been hearing that at the very high end, there is no drop in demand. That's Aston Martin's justification for the One-77. I would imagine that the likes of Jaguar, BMW and Mercedes might be in for hard times, but Rolls-Royce and Bentley seem to be confident. Same with Lamborghini. And I've heard that of yacht builders, too.

Then again, if I were CEO of those companies, I'd be saying that things were fine.

Do �4k processors and �6k speakers count in that bracket? Perhaps it will be more of a problem for the likes of Denon, Arcam or NAD?

Rolls-Royce have dropped 50% over the last 12 months alone and no its not all recent!
Sealine who are one of the largest UK yacht builders is closing two of its factories and making 300 people redundant.
In a statement, the company said: “As economic conditions worldwide continue to worsen and are unlikely to change in the foreseeable future, Sealine is planning for a leisure marine market that will be smaller in the near and medium-term and will be scaling production output accordingly.

I don't imagine Aston, Rolls or Lamborghini will maintain sales in the short to medium term.

I don't think value has much to do with it,

Blackstone Group one of the largest private equity companies worth �30bn lost �84m in the last 3 months of 2007 and are selling the hotel side of the business.

I guess only time will tell.

It may not work but it would be a great time offer "upgrades" at modest prices to survive through the storm. And take advantage of their existing customer base.

Presumably he came to the judgement about M's "bilion dollar business" potential before the current economic situation kicked off. He may have revised his opinion now. While Milchan is undoubtedly a rich man, I suspect he's also a shrewd man, who wouldn't hesitate to effect an exit strategy if M don't deliver financially.

Mark S

True. I guess it depends on how passionate he was/is for Meridian and Meridian products as well as his shrewdness. There may be a global recession in progress, but there is still plenty of money in the oil-rich states.

There is still a LOT of money around. A recession is a great time to be employed and pickup/invest in some great bargains, albeit, usually at someone else's expense. In Australia, the brokers are hurting and a lot are selling their Ferrari's and Lambo's. I saw Gallardo's advertised in a Sydney auction house at nearly half price, with only 5000klms on it. Now, if only I had a spare $230k!!

Meridian will survive.
The investors have very deep pockets and the tax advantages to them are significant. Most of the previous problems with Meridian seem due to limited capital for development.
There is not much doubt that Meridian design and build great equipment.

I agree that M should survive if its investors want it to. That being said, these times will exasperate the difference between the halves and have nots. That means products like the 8 series should continue to sell in historic patterns but products like the F80 (sarcastically viewed as a pricy clock radio) will be under pressure. M is in for hard times because of its poor retail and mind share presence. I can tell you that the exotic car dealers I know are all crying (RR, AM, Bentley, etc) The only car right now that is holding up is the Ferrari Scuderia. Even the other Ferrari models are soft right now. Yes, BMW, MB are having a terrible go of it too. A good question is will JagUar survive? I don't know.

I thought we were talking about the "haves" and the "have yachts"

I think M could do well to release a very thin server client priced somewhere between SB abd Sonos. They'll be able to tap the little disposable cash that might be out there and ready a new customer base for when the times improve.

If they only sell big toys it'll be tough I am sure.

nick: wouldn't building the distribution channel for such a device be cost-prohibitive against its margins unless it was going to push lots of other products into that channel (which products don't exist in the price point)?

jerry: does jag deserve to survive?

doody.