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Tom Hogan Motors gone bust!

drunken_munky52

Just read on RTE that 190 jobs are likely to go becuase Tom Hogan group is on its knees. The showroom in Ennis is already closed and the others may go aswell.

This is shocking, as Toyota are Irelands favourite and never expected this brand would be hit first. How come other car companies have managed to beat the session so far and they couldnt.

Most likely down to bad management and high prices. Can anyone come up with any other ideas?

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Run_to_da_hills

drunken_munky52 wrote: »

Just read on RTE that 190 jobs are likely to go becuase Tom Hogan group is on its knees. The showroom in Ennis is already closed and the others may go aswell.

This is shocking, as Toyota are Irelands favourite and never expected this brand would be hit first. How come other car companies have managed to beat the session so far and they couldnt.

Most likely down to bad management and high prices. Can anyone come up with any other ideas?

More to do with rediculous VRT rates here, cheaper secondhand imports from the North and general cut backs in peoples spending.

Mountains of other main dealers have gone belly up around the country with heaps more to go before the years out. We had Pat Keogh Ltd in Limerick, Esmonds in Stillorgan,, Crawfords of Dunlaoghaire, Audi Mazda Turners Cross Cork, Appleton Motors in Cellbridge, Main Opel Dealer, CoopersFiat in Sligo, White Bishop of the long Mile Road, Dublin, Kia. Seat & Citroen, BK Motors in Balbriggan, PreformanceCars in Coolock

Independant Traders gone Bust 9
Main Dealers gone Bust 12
Non renewed franchises 2

Thread on the subject in Motoring forum.
http://www.boards.ie/vbulletin/showthread.php?t=2055436742

Fallen Buckshot

Quick buy into the horse and buggy market !

Hawk Wing

The Government have to shoulder responsibility for some of this, the VRT is a joke, and now more than ever people are going to England and the north for better cars and better value, these morons are running this country into the ground

Run_to_da_hills

Hawk Wing wrote: »

The Government have to shoulder responsibility for some of this, the VRT is a joke, and now more than ever people are going to England and the north for better cars and better value, these morons are running this country into the ground

I was seriously thinking of upgrading this year but decided to hold back and put the cash it into a scoot instead.

There are heaps more holding back, the only dealers that are doing anyway ok are those with large service & maintenance or busy fuel / deli sales attached. Unfortunately T Hogans had both and still could not make it. Their fuel sales were a bit too far out of town to catch the local Ennis trade and they also lost out on passing trade with the recent bypass.

R.I.P. Tom Hogans.

Akrasia

just yesterday I posted this about the site including the One Mile Inn

As far as I know, the Hogans of toyota fame bought the place with the intention of knocking it down, along with the esso garage which they already owned, and the old pitch and putt site for a big retail development. figures were massive, between 7 and 15 million was spent (allegedly) on the land....

Money that will never be recovered (though it'll probably find it's way onto the books at NAMA)

I think the whole project fell through because the area was deemed to be against the town development plan (in other words, the residents of the shanaway road had more influence than even the Hogans)
http://boards.ie/vbulletin/showthread.php?t=2055600722

The Hogans might complain about the state of the motor industry, But I suspect bad speculative investments in land and property and developments were the primary reason the group failed.

I feel very sorry for the staff who have just lost their jobs, but don't have very much sympathy for the owners as they are ruthless businesspeople and have probably protected their personal fortunes very well before winding up the business and leaving the suppliers and staff hanging,

asmobhosca

Akrasia wrote: »

just yesterday I posted this about the site including the One Mile Inn

The Hogans might complain about the state of the motor industry, But I suspect bad speculative investments in land and property and developments were the primary reason the group failed.

I feel very sorry for the staff who have just lost their jobs, but don't have very much sympathy for the owners as they are ruthless businesspeople and have probably protected their personal fortunes very well before winding up the business and leaving the suppliers and staff hanging,

Youre dead right in one respect, it was the peoperty side of things that brought down the group and there is no doubt about that, it had nothing to do with VRT, Petrol sales or deli offerings as others have suggested here.
Toyota is probably the safest and most profitable franchise to operate internationally, even in bad times they still sell reasonably well. There wont be a shortage of people looking to takeover these franchises.

However the end of your post is downright libellous, bitter and just vicious. I know a now former staff member very well and while devastated he still had only good things to say about the Hogans today. I have also met Paul many times and found him to be a very decent guy.
They sponsered Eire Og for years and were generous to local charitys as well as providing employment for 30 years.

No one sets out in business to go broke, as for "protecting their personal fortunes" I find this highly unlikely given the banks in Ireland's use of personal guarentees to secure company debt. Much of the time everything is intertwined and cross collateralised so the limited liability that a company affords you can be meaningless. Meaning when the **** hits the fan its like a house of cards, one brings down the rest.
I dont think they'll be out on the streets either but can you imagine the feeling of losing the company that your parents built from scratch in the 70's? It must be devastating.

I have great sympathy for all involved, the staff, any creditors left in the lurch and the hogans, a sad day for clare business.

drunken_munky52

Akrasia wrote: »

just yesterday I posted this about the site including the One Mile Inn

The Hogans might complain about the state of the motor industry, But I suspect bad speculative investments in land and property and developments were the primary reason the group failed.

I feel very sorry for the staff who have just lost their jobs, but don't have very much sympathy for the owners as they are ruthless businesspeople and have probably protected their personal fortunes very well before winding up the business and leaving the suppliers and staff hanging,

Doubt the assets of the buisiness could have been tied up with their land assets directly, but good point you raise, well spotted.

The reason why theres a session at the minute is becuase the likes of the Hogans got reeled in by the property bubble, everyone was at it. I myself, a young man, had notions 3 years ago of someday owning my own property empire, how glad i now know property aint worth the risk.

Did you hear what the IMF said about the economic boom? Irelands Celtic Tiger boom "MASKED" the Irish economy's and public finance's weaknesses. Finally w'eve snapped out of it.

carmel45

drunken_munky52 wrote: »

Just read on RTE that 190 jobs are likely to go becuase Tom Hogan group is on its knees. The showroom in Ennis is already closed and the others may go aswell.

This is shocking, as Toyota are Irelands favourite and never expected this brand would be hit first. How come other car companies have managed to beat the session so far and they couldnt.

Most likely down to bad management and high prices. Can anyone come up with any other ideas?

no, but its very sad

finbarrk

It's the lads who lost their jobs I feel sorry for. It looks like greed got the better of the lads in their mad plunge to aquire plots of building land. I doubt if their father, lord rest him, would have allowed them to behave in such a reckless fashion if he was still alive.

clarecoco

Not surprised this trader and other dealers gone bust. In Jan 2007 I was quoted €20k to upgrade from a 4 year old Primera to a new Toyota avensis. I got €10k in a trade in from another dealer. I know several people over the past few months who bought the old model Toyota Avensis from Tom Hogan motors for €20k IN A STRAIGHT DEAL . I could not trade in my own car for this price 2.5 years ago.

They got greedy and everybody had to go on a waiting list for a new car

finbarrk

clarecoco wrote: »

Not surprised this trader and other dealers gone bust. In Jan 2007 I was quoted €20k to upgrade from a 4 year old Primera to a new Toyota avensis. I got €10k in a trade in from another dealer. I know several people over the past few months who bought the old model Toyota Avensis from Tom Hogan motors for €20k IN A STRAIGHT DEAL . I could not trade in my own car for this price 2.5 years ago.

They got greedy and everybody had to go on a waiting list for a new car

You are wrong there. Tom Hogans closing has nothing to do with selling cars. It's about overpriced property deals that the garages were used as security for the borrowings.

clarecoco

Tom Hogan motors was a car dealership not a property company. In 2005 the company opened new premises in Galway at a cost of €3 million. According to the most recent accounts filed with the Companies Registration Office, the Tom Hogan Group reported a pretax loss of €393,163 in 2006 after a writedown of €992,559 for exceptional costs. Turnover was €103 million and the cost of sales €98 million (less than 5% profit in a boom year!!). New-car registrations up to June 09 are down more than 60 per cent compared with a year earlier. It became insolvent, because it was not selling enough cars to cover the very high overheads and make a profit. When it was making a loss it could not pay day-to-day debts. If the directors had other property interests this had nothing to do with Tom Hogan motors going bust. It was a standalone issue: the car dealerships were losing money and could not cover costs or pay any debts.

asmobhosca

clarecoco wrote: »

Tom Hogan motors was a car dealership not a property company. In 2005 the company opened new premises in Galway at a cost of €3 million. According to the most recent accounts filed with the Companies Registration Office, the Tom Hogan Group reported a pretax loss of €393,163 in 2006 after a writedown of €992,559 for exceptional costs. Turnover was €103 million and the cost of sales €98 million (less than 5% profit in a boom year!!). New-car registrations up to June 09 are down more than 60 per cent compared with a year earlier. It became insolvent, because it was not selling enough cars to cover the very high overheads and make a profit. When it was making a loss it could not pay day-to-day debts. If the directors had other property interests this had nothing to do with Tom Hogan motors going bust. It was a standalone issue: the car dealerships were losing money and could not cover costs or pay any debts.

Well done obviously you can read the irish times website and copy and paste, but you know very little about accounting practices and you obviously havent actually READ the accounts which you quote.

What these figures will not tell you are the levels of directors fees, contributions to directors pensions, consultancy fees to directors included in admin expenses, rents to associated companies/directors and various other means of taking money out of companies to eliminate profits and therefore avoid paying corporation tax.

Hundreds of very profitable companies in Ireland show a loss on paper in the accounts filed in the CRO. Anyone who understands accounting procedures and filing requirements in Ireland for limited companies can tell you this.

The reason for this is thanks to systems of personal tax reliefs such as capital allowances and rental income allowances, penion contributions, etc means that a director can take out the profits without paying any income
tax.

E.G. - Paul Hogan bought a listed building near ennis as his principal private residence and refurbished it at huge expense, all of which he is able to write off against ANY income.

I have heard that the hogans spent up to 90 million on property in the last few years (could be a rumour or exaggerated) if so this is likely to be highly leverged which would have necessitated personal guarentees from the hogans for the banks for the loans. I would not be surprised also if the hogans used their shares in the motor group as security for the loans.

Looking at the accounts they seem to have quite a bit of land in the motor group which various different banks have charges over outside of their garage locations.

Also the total debt of the motor group was only 15m at end 2006, which really isnt that high considering the size of the group.

Also if you look back over the accounts for the last 10 years they rarely showed a large profit, taking the money out in the various mechanisms i outlined above.
Remember cost of sales includes wages to Directors!!

Another thing you probably didnt realise (i didnt till i read the accounts) is that the company changed from a limited company to an unlimited one 2 years ago.

The upshot of this is that while you dont have to file detailed accounts anymore, limited liability is gone and if the compamy goes into difficulty, the shareholders are liable!!! Also if the shareholders are in trouble the company shares become fair game for the banks.
The "Standalone issue" which you speak of is now truely out the window!!!

Also the exceptional item was a write off of a related party debtor (i.e. one of the shareholders or a related company).

Finally the net value of the company including all loans and liabilities was over 10m, hardly insolvent!!!

Sorry to go on a rant like this but if youre going to make comments like the above at least have an idea of what youre talking about.
Judging by your previous post you dont understand the motor industry either.

I see the Irish Times reporter didnt bother his ass reading the accounts either...

Mark my words this will not be the last case of a viable company being brought down by property speculation by the directors/shareholders.

P.S. if you'd like to see the accounts pm me and i'll send them to you!! I got them off vision net.ie, its a great site!!!

palaver

clarecoco wrote: »

If the directors had other property interests this had nothing to do with Tom Hogan motors going bust. It was a standalone issue: the car dealerships were losing money and could not cover costs or pay any debts.

Sorry, but you're wrong here. Hogan bought overprized property (One Mile Inn, as far as I know) with loans and used the garages and motor business as collateral. When the property became worthless (development plan failed - recession anyone?) the banks just had enough and seized and closed the garages.
It was pure greed, trying to be part of property kings instead of concentrating on what they know about which is the motor business.

How do you know about the accounts and the exact numbers? Even if they are true there would still be no reason to close the motor business down. There would still be enough assets to keep it going.

Edit: asmobhosca, saw your posting after I posted mine. Well spoken and even better researched!

buck65

Also Hogan was supposed to be involved in a big property deal in Dublin that lost alot of value, JJ Rattigan builders and a third party also rumoured to be involved.

clarecoco

I based all my comments on my experience of the company and facts - not rumour and innuendo which seems to be very prevalent in this thread.

My point is that there seems to be an obsession with linking the failure of the Car sales company with property speculation. In this case we are talking about a liquidation - it was not closed down by anybody. This happens when a Company reaches the end of its life, or becomes insolvent. A creditors voluntary liquidation is the most commonly used procedure for dealing with an insolvent company. In summary, the directors "voluntarily" place the company into liquidation. If the banks were calling in loans they would normally appoint a receiver as happened when National Irish Bank installed a receiver over the Citroën and Mitsubishi dealership Magheracloone Motors.

Tom Hogan motors went into liquidation like the following car companies:
Limerick BMW dealer Pat Keogh Ltd
Newlands Renault
Ray O’Brien Motors, newbridge
Brendan Brady, BBC in Navan,
Westland Motors, Liffey Valley Peugeot dealer has also closed

I think any reasonable person would see the trend here – very few motor companies are not making money in this recession and many will close down unless the go back to basics of looking after customers.

The point about changing to unlimited is very valid. If an unlimited company cannot pay its debts, its owners (known as members) are liable for all those debts. This exposes the total assets in the event of the failure of the company.

For information the following are related companies – similar Directors as published in the Company Registration Office

CRO Number Company Name
65103 TOM HOGAN MOTORS (ENNIS)
127533 TOM HOGAN MOTOR GROUP
300255 TOM HOGAN MOTORS (SHANNON)
300847 TOM HOGAN MOTORS (CLONMEL)
341008 CORPORATE FLEET MANAGEMENT LIMITED
341763 TOM HOGAN MOTORS (DUBLIN) LIMITED
347119 GALWAY AUTOBODY
359143 MOTORWAY CARS (ATHLONE) LIMITED
452960 TOM HOGAN MOTORS (ORANMORE)
188845 TANSIDE PROPERTIES

There is one property company in this list of 8. All the others are related to the motor industry.

drunken_munky52

Lets not forget that alot of places dont have Toyota dealers now becuase of this. Where are we to go if we just want to test drive the best built cars in the world? We need a new dealer to fill the void.

Run_to_da_hills

drunken_munky52 wrote: »

Lets not forget that alot of places dont have Toyota dealers now becuase of this. Where are we to go if we just want to test drive the best built cars in the world? We need a new dealer to fill the void.

You will have to go to Sheils, the Mondeo will kick the Avensis :pac:

drunken_munky52

Toyota have always been known for thier reliability and quality.

Ford have been known for rust buckets such as the Escort, Orion, etc. They have only been playing catch up with Japanese quality in recent years and they are still no where as good as Toyota.

Sure what kind of Mondeo are you on about? It could be a 1.8 that "kicks" a 1.6, its not rocket science why that happens and has nothing to do with the brand of car.

buck65

clarecoco wrote: »

My point is that there seems to be an obsession with linking the failure of the Car sales company with property speculation. In this case we are talking about a liquidation - it was not closed down by anybody. QUOTE]

Come on man, everyone knows that property was the reason that Hogan's went under.

finbarrk

buck65 wrote: »

clarecoco wrote: »

My point is that there seems to be an obsession with linking the failure of the Car sales company with property speculation. In this case we are talking about a liquidation - it was not closed down by anybody. QUOTE]

Come on man, everyone knows that property was the reason that Hogan's went under.

Dead on there.

asmobhosca

clarecoco wrote: »

I based all my comments on my experience of the company and facts - not rumour and innuendo which seems to be very prevalent in this thread.

My point is that there seems to be an obsession with linking the failure of the Car sales company with property speculation. In this case we are talking about a liquidation - it was not closed down by anybody. This happens when a Company reaches the end of its life, or becomes insolvent. A creditors voluntary liquidation is the most commonly used procedure for dealing with an insolvent company. In summary, the directors "voluntarily" place the company into liquidation. If the banks were calling in loans they would normally appoint a receiver as happened when National Irish Bank installed a receiver over the Citroën and Mitsubishi dealership Magheracloone Motors.

Tom Hogan motors went into liquidation like the following car companies:
Limerick BMW dealer Pat Keogh Ltd
Newlands Renault
Ray O’Brien Motors, newbridge
Brendan Brady, BBC in Navan,
Westland Motors, Liffey Valley Peugeot dealer has also closed

I think any reasonable person would see the trend here – very few motor companies are not making money in this recession and many will close down unless the go back to basics of looking after customers.

The point about changing to unlimited is very valid. If an unlimited company cannot pay its debts, its owners (known as members) are liable for all those debts. This exposes the total assets in the event of the failure of the company.

For information the following are related companies – similar Directors as published in the Company Registration Office

CRO Number Company Name
65103 TOM HOGAN MOTORS (ENNIS)
127533 TOM HOGAN MOTOR GROUP
300255 TOM HOGAN MOTORS (SHANNON)
300847 TOM HOGAN MOTORS (CLONMEL)
341008 CORPORATE FLEET MANAGEMENT LIMITED
341763 TOM HOGAN MOTORS (DUBLIN) LIMITED
347119 GALWAY AUTOBODY
359143 MOTORWAY CARS (ATHLONE) LIMITED
452960 TOM HOGAN MOTORS (ORANMORE)
188845 TANSIDE PROPERTIES

There is one property company in this list of 8. All the others are related to the motor industry.

Ah for Gods sake man are you for real?
I already explained to you in detail why and how the property investments brought down the Hogan group.
The Dogs on the street know it was the property that brought it down, people who know the hogans know it was the property that brought it down. People in the car industry know it was the property investments that brought it down.
Its common fecking knowledge at this stage.
Youre wrong get over it.

Also do I detect a bit of Glee in their demise given your only 3 posts ever on here are about the hogans, the first one giving out about what they offered you for your used car....

Again I say to you READ the ACCOUNTS they explain alot, and also just because a company has the word "motor" in its name doesnt preclude it from purchasing property assets.
If there is bank finance attached to these folios then they are also declared in the accounts, and in the hogan group there are plenty of these.

Also in a voluntary liquidation it can often be in the interest of the Directors and the banks to go this route, and agreement between the parties is usually involved following negotiations beforehand. Although I must admit I have very little knowledge of liquidations specifically involving unlimited companies. (they are very rare in Ireland)

Also in speaking in general terms about the motor industry the reason so many dealers are going bust is not just falling car sales, but the level of debt these dealerships have been forced to take on by Car Manufacturers to build the shiny new glass showrooms. Pat Keogh in Limerick is a very good example of this.

youre of course entitled to your opinion but if you really believe it then read the accounts and justify it with your "facts"

clarecoco

I am converted. The property investments caused the liquidation. Mea culpa. Though I am worried where everybody will go for their Toyota....

palaver

clarecoco wrote: »

I am converted. The property investments caused the liquidation. Mea culpa. Though I am worried where everybody will go for their Toyota....

Good

! That's the point of discussions. But not your fault - no 'mea (tua) culpa'.

I don't know about Toyota, was never a fan (Nissan is way better and more reliable), but I bought a second hand car at Hogan's in April with a six months warranty.
That really worries me, despite the promises that warranties will be honoured. But where to go when all the Hogan places are closed?

Akrasia

....

finbarrk

palaver wrote: »

Good ! That's the point of discussions. But not your fault - no 'mea (tua) culpa'.

I don't know about Toyota, was never a fan (Nissan is way better and more reliable), but I bought a second hand car at Hogan's in April with a six months warranty.
That really worries me, despite the promises that warranties will be honoured. But where to go when all the Hogan places are closed?

If you bought a Toyota more than likely you won't need to use the warrinty.

palaver

finbarrk wrote: »

If you bought a Toyota more than likely you won't need to use the warrinty.

Nah, it's a Renault Clio, a trade in apparently. Hogan's didn't do only Toyota in the second hand car section.
I'm happy with the vehicle, works fine, at least compared to my old banger, a Nissan Sunny '91 which was absolutely reliable and low maintenance over all these years.
But there is still the warranty I might (!) need.
It's the principle of warranties of a company gone bust which worries me.

Clareman

There is a union of car traders in Ireland, can't remember the name of them now, you could give them a shout and find out what the story is with your warrently

Clareman

Here you go, get in contact with them http://www.simi.ie/

palaver

Clareman wrote: »

Here you go, get in contact with them http://www.simi.ie/

Thanks Clareman, I'll try that. But with my luck the first car failure or whatever will occur about two days after the warranty ended anyway ... :rolleyes: