I think (and Hughlysses' comments above seem to support this) LAP is interested in getting the best return on their investment, and that may not be the 'quick buck'. Sure, ultimately they're probably more interested in making money than selling motorcycles, but the path they're taking may be very wise.Originally Posted by GJB
Imagine you find an old Camaro rusting away in someone's garage. You pay $500 knowing you could turn around and sell it for $1000. But you also know that if you invest $5000 in it you'll be able to sell it for $20,000.
I think LAP thinks they'll get much more for a functioning motorcycle company than what they'd get for the parts.
It's even possible that in this particular case there may not be any "quick buck". Selling off the equipment and parts might not get them more than they paid, but assembling the parts into motorcycles may be worth far more than they'd get for anything else. We've heard rumors that there are parts to make 300 bikes. If they can sell those bikes for approximately $10,000 each, that's $3 million.
If they can do that for less than $1 million investment, they've broken even. Then if they can sell that operating motorcycle manufacturer for a modest $5 million, that's $5 million of pure profit.
And who knows. Maybe once they get going they'll realize it's worth running the business for the foreseeable future and they could actually become motorcycle manufacturers. I know I'd love to try doing that if I had some cash to try.
But the bottom line for us is it seems we'll be able to get parts. I've never been particularly concerned about the warranty. I figure most manufacturers calculate they won't make very many warranty repairs before they offer it. But the idea that the actual parts wouldn't be available scared me. I think a lot more people will be willing to buy some of the bargain bikes that are still out there if they have some confidence parts will be available.
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