The value of things

The tourist industry is very important in France, although this year it is going to have a difficult time – so I am hoping that M. Sarkozy will announce soon that he will compensate us, and all the thousands of hoteliers and gite owners and travel agents in France, for the slowdown in business. It is after all an important part of the economy on which a great number of people depend.

If the government could offer to pay for any unbooked accommodation or uneaten meals that would be very useful – I’m thinking that would be much preferable to having to reduce the rates on the unsold weeks in our gites, at least from our point of view.

You might of course think that if we or anyone else has gites or hotel rooms that aren’t booked, or restaurant tables that aren’t filled, we should reduce our prices and tighten our belts in order to make the best of a difficult time.

If someone is doing their best to attract customers and still can’t make enough  money to survive, they should either be allowed to go bust, or they should be helped out, depending on your personal opinions – but most people would agree the effort comes first and any ‘bailout’ comes later, and that simply giving us money so we can keep prices too high would not be a sensible idea.

In fact you might be wondering where I dreamed up such a hare-brained scheme – that prices should be kept at the same levels as last year, and the government should make up the difference…so I’ll tell you.

The last week or so we’ve looked at quite a few cars – as I explained before we need to buy one quite urgently. Some car sellers have reduced their prices quite substantially – we saw a lovely Honda Civic at 20% reduction. Certain manufacturers haven’t reduced their prices – Renault and Peugeot are offering the same ‘discount’ as they were offering last year (less than 10%).

I can’t help wondering if there is a connection between the large amounts of money the French government are giving to the car companies and the fact they aren’t reducing their prices – why would they bother cutting prices when they are getting the money anyway? (Presumably the same situation might exist in other countries where the car industry has been bailed out – I’m not suggesting it’s a uniquely French problem.)

I noticed that a (French marque) garage about an hour from us was selling a second-hand model of one of the cars we had been looking at locally (a 2008 model which had done a few thousand kilometres), so I sent them an email asking if the advertised price could be discounted, since their listed price for the second-hand car was the same as we could buy the exact same model brand-new.

The reply – ‘the price advertised is the only price that we will sell the car for’. Well, good luck with that then.

The big idea with car sales in France at the moment seems to be to advertise a car as having a large discount, but that doesn’t bear up to close scrutiny. 1000 euros of the ‘reduction’ might be dependent on handing back a car over 10 years old (a government scheme), and another 700 euros might be because the car is environmentally friendly (another government scheme – the ‘bonus-malus’ plan) – hence 1700 euros of the ‘discount’ is courtesy of the government. The other 2,500 reduction will typically consist of ‘items of a value of 2,500 euros that are included free in the price’ – metallic paint 800 euros, front fog-lights 400 euros – things that only have such exalted values in the wildest dreams of the manufacturers.

I have no idea what the real value of a car is or should be, but I do know that refusing to actually reduce prices when sales are plunging (Japan have just reported a 66% drop in car exports compared with last year) is, to put it mildly, unlikely to be the best solution – for the car companies or the taxpayers.

As for me, I’m holding out for the 15,000 euros Toyota Prius. Might be a long wait though. Otherwise I’ll just buy a full-priced one with the big ‘aid cheque’ that I’m sure will arrive from the government some day soon.

2 Responses to “The value of things”

  1. Hi Boris – As fun,interesting and informative as ever, but do I notice a slight undercurrent of trepidation in your recent posts?
    Don’t let the doom mongers get to you.
    As an avid reader of francethisway for sometime before we ‘made the leap’ – and still so a year after the event – I find your musings quite a good indicator as to the state of things.
    We are thinking of having a little B & B business here in Bourges, Cher Centre. It wont be/can’t be anything grand since we only have one spare en-suite bed / shower etc in the small house. The occasional 50 euros drifting our way would be nice , especially as for the last year the ( lots of of ) euros have been drifting in the other direction.
    You would have experienced similar when you were putting your venture together, and probably still are with storm induced maintenance etc.
    With your take on the current economic climate, how would you kick-start such a ‘micro’ business?
    Being an attractive medieval town in the middle of France it is a good stopping off place on the way to the Pyrenees /the Southern coasts , etc – as several migration prone friends have discovered.
    Your thoughts appreciated, John

  2. John, sounds like a good idea, every 50 euros helps and if you have a house somewhere well placed it sounds like a great idea. Don’t forget to check with your insurance company before starting , and I think there are probably rules that apply to people serving food and drinks that you would need to check out – your local mairie will point you in the right direction.
    Does your local tourist office have a list of local chambre d’hotes for passing visitors? Most do and will be the one place almost all visitors will stop at. Is your property situated where a sign on the house would be seen? If there is a significant English community nearby put the word about to attract people that have family coming over for a couple of days and need an extra room.
    I’m not sure what websites people look on for chambre d’hotes – keep thinking we should start one on ftw but I never have time. If anyone knows please post a comment below.
    The rules for small businesses are much improved under the new auto-entrepreneur system (talk to your chamber of commerce or tax office), which allows social charges to only be paid on actual earnings (not estimated earnings) – pretty radical.
    Re kick-starting, I’d keep the charges low for at least the first year, offer great service, and try and get a group of people who recommend it and want to come back – these are much the best kind of visitor to get.
    Sorry I can’t give more useful help, I never quite grasped the b and b business in France…
    Good luck with it, keep us up to date how it goes.
    ps you’re right, recent experiences with running a business, buying a pc etc have turned me into a cynical old git. But now, the sun is shining, I’ve just finished a big project…things are looking up!

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