Down-On-Their-Luck Jaguar Customers Pay Thousands - For No Car With AM-GM, Bjt
LONDON (AP) _ It’s not exactly a car buyer’s dream: After coughing up $183,600, you can’t even kick the tires. You won’t need tires because you won’t get a car.
But luxury automaker Jaguar claims to have received several takers on an offer to let cold-footed customers pay their way out of a contract to buy its so-called ″supercar,″ the XJ220, with an original price tag of $612,000.
The limited-edition two-seater - with a top speed of 212.3 miles per hour - is now worth substantially less. About 100 would-be drivers have defaulted on their purchase agreements, which initially required a $76,500 deposit.
Jaguar has told the unlucky folks they can bypass a legal battle by paying out another $107,100 for an ″escape clause.″ Payment must be in cash, with no installments allowed.
″The whole intent is to bring this thing to a speedy conclusion,″ Jaguar spokesman David Boole said Friday.
The the fate of the XJ220 in many ways symbolizes the end of the 1980s boom.
When Jaguar, a Ford Motor Co. subsidiary based in Coventry, England, announced in December 1989 that it would be making just 350 of the cars, some 1,500 people put in applications.
Some were well-heeled car lovers. Others were speculators, some of whom quickly sold their contracts for prices that reportedly gave them instant profits of up to $306,000.
The recession soon put a damper on the party.
″Since 1990, the value of the car has fallen in line with the world economy to a value below the purchase price,″ Boole acknowledged.
Jaguar has delivered about 150 of the vehicles. Of the 200 that still must be finished, about 100 buyers don’t want them. One automotive industry source said the unfinished cars probably will be worth a mere $428,400 when they are ready to drive.
Jaguar appears to be trying to break even on the project by charging its non-paying clients the difference between their deposit price and the probable sale value, said the source, who spoke on condition of anonymity.
Boole agreed that Jaguar most likely will sell the cars at below original purchase price. The initial deposits, plus money from people taking the escape clause, ″allows us to make a substantial reduction in the price,″ he said.
But anyone who entered into a purchase agreement who fails to buy into the escape clause will be liable to make up the difference between the original price and the ultimate selling price, Jaguar said.
Jaguar last week sent letters to its reluctant buyers outlining the details of the offer.
″As of Wednesday, a few had responded with checks,″ Boole said. Jaguar declined to release its letter to a reporter.