AMA won't go down that path, they paid well over the odds...

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DocHudson

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25/01/24

14:15

Post #: 72066304
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Originally posted by Chevelle67: ↑

I was under the impression that the industry was operating at capacity, with most shops large and small understaffed even at the current rate of sales. If that is still the case, where does Suncorp find the capacity to absorb the business AMA is now handling for them (and making zero money doing so)?

The point is, AMA paid Suncorp $400 MILLION for what should have been a great joint venture between the two companies. Instead, Suncorp somehow got out of that contract, during the hight of the COVID panic, and AMA's shareholders were not told of the massive implications of that for an outrageously long time. I'm pretty sure that is fraud, which is illegal, and a breach of fiduciary, by not only AMA, but by Suncorp as a JV partner. I'm not a lawyer but I think AMA has a right to sue Suncorp for the entire $400 million or to have the original contract reinstated.

But forgetting that for now, this idiotic PCM (predictive cost method) pricing has to go, everything should be line by line. The companies in this business in the US and Canada look at Australia collision repair and shake their heads wondering how on earth they would ever have agreed to PCM pricing.

AMA needs to be a pricing leader, as their market share allows, and rid the industry of that absurd PCM model. It should all be done line-by-line like the heavy division does.

Russ, you're in the busienss, wouldn't you agree?

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AMA won't go down that path, they paid well over the odds for that business and had the same information that the other bidders had.

when you buy a business at 20 times on a business that has minimal upside to claw that back that is your own fault.

I still think that was a desperate purchase to line up some revenue to replace the diminishing IAG work.

AMA Price at posting: 6.9¢ Sentiment: Hold Disclosure: Held
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AMA won't go down that path, they paid well over the odds...