David Martin Graff
First Officer
Flight distance : 108805200 ft
United States
Offline
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Ex Machina Posted at 8-25 16:48
The general rule of thumb is that as soon as you take a retail item home, or drive a car off the dealer's lot, it depreciates 40%.
Electronics are still rapidly evolving, and generally depreciate faster than hand-made items; next year's models always are much improved, yada yada. Is the original Mavic Pro going to be a collectible? Maybe, but I kind of doubt it. I'd sell it while you can still get some money out of it.
Yes, you are right about the depreciation rule. But what rule and what schedule are we incorporating?
Straight line depreciation?
Double declining balance?
Modified accelerated cost recovery rule?
How are we calculating amortization? Are we doing so equally over a period of years or are we using an impairment test? I know it sounds like my career is in valuation, because it is. If you subscribe to Alan Greenspan's irrational exuberance that prices are rational, I would only venture to say remember DJI charged a 50% premium for the M2P over the MP year over year. At this rate in 5 years if DJI were to continue charging a 50% premium for each subsequent Mavic iteration, then we'll see a Mavic crack the $5,000 price point in likely 5 years?? By the time 5 years comes around, a Mavic Pro including all drones are going to be locked down with a geofencing and NFZ evolution that will practically make the drone flying experience almost entirely automated, and as a result, people may be looking to some of DJI's earlier Mavic iterations as a means of experiencing a more truer flying experience, and that could command a heft premium from now for a Mavic Pro original??
I appreciate your feedback, thank you. |
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