Why The Collector Car Market is Exploding
The market for “collector” cars, which includes “exotics,” retro-mods, and pretty much any car over twenty years old, has shown intensive growth in the past few years. Examples abound, and I was commenting to my wife this morning that it’s a pity we did not win a huge lottery years ago, as many of the cars on my “wish list” (it’s a very long list) have recently shot up in value. I could sell any of them today and deal with the tax bills to be paid.
Two examples: The DeTomaso Pantera was always a favorite. Italian design flair, a 5 speed, and a health Ford V-8 in the rear. Early teething problems have all been sorted on the remaining examples. I used to chat periodically with an attractive young woman at a store where I was having some published pieces I had written framed for the dealership that was featured in them. She was interested in cars and motorcycles, and mentioned that her senior project in high school had been a long and comprehensive list of tasks accomplished to improve the cooling system of her father’s Pantera. If I’d been about 40 years younger I would have followed her around like a puppy until the inevitable restraining order!
Panteras hovered in the low 20s range for years, and then crept into the 30s. Today a good one will cost 75 grand or so.
The Sunbeam Tiger. This was a small British sports car, the first car my father splurged on in 1962. I was allowed to drive it just once. From the driveway 200 feet into the garage. Engineers from England visiting for dinner were shocked when I went off for a date in our almost new Mercury sedan. They could not understand why my father did not want me to drive such a simple and unassuming sports car. My father felt (and now I agree) that I would park it in a ditch within 10 miles.
I preferred riding in it with my mother, also an engineer. She felt that if the tach was “red lined” at 6,000 rpm, then anything below that was fair game, and she drove it with enthusiasm. My father only let his hair down once in my company. We entered a sports car rally in the Alpine. We crested the brow of a hill and ahead could see a V junction, and the straight led to a check point. At the last second he figured out that it was an off-course control, and he threw the car sideways in a smoking and sliding stop, ending with the front wheels on one road and the rear on the other. We were one of only two teams that avoided the penalty. Later that day we were chasing a Corvette on a winding road. Father commented “See, this is just like a Corvette.” Then a straight appeared, and the Corvette disappeared into the distance. Coincidentally, my father also improved the cooling system in this car, drilling new passages in the cylinder head on the metal lathe in our basement. Didn’t everyone have one?
Carroll Shelby of Cobra fame got his hands on an Alpine and dropped a Ford 260 V-8 into it, and later that was upgraded to the famous Ford 289. Famed Brit Ken Miles did the development work, and Shelby once made the heretical comment that the Tiger was a better car than the Cobra.
A friend owned one back in the late 70’s, and his recollection was that the engine had more torque than the chassis could handle. Some days the left door would not open, and on other days the right. On a few occasions a door would open mid-corner.
Tigers languished in the forgotten land of old sports cars for decades, while the Cobra, which originally was a hard sell, soared in retrospective popularity. Until fairly recently you could purchase a Tiger in the teens, and then the 20s, until good ones broke into the high 30s. I just watched a really good one sell at auction for over $70,000! That may seem steep, but an original Cobra will bring a few hundred thousand to a million.
There are dozens of other examples. Why the surge? Several factors may be involved.
- As the Ferraris boom, so shall all of ye prosper. The market for any Ferrari, and especially older ones, has skyrocketed out of sight. This happened once before, and then there was a crash of values in 1989 and it took a decade and a half for the boom to return. I am not sure there will be a bust this time around. Older Ferraris are now going for truly ridiculous amounts, including over TWO MILLION for a car in storage for 40 years since an engine fire did a lot of damage. It will cost another half a million, at least, to get it right. Best of the best is the Ferrari 250 GTO, and one recently sold for 65 million.
- For most collectors, Ferraris are rapidly leaving the land of the possible, and so they look elsewhere. Because of this, other cars are now appreciating at a rate that is stunning. An early Porsche 911 would have been a fantastic investment just a few years ago, but now they are soaring past $100,000, and exponentially more for one with the provenance of winning race performances, etc.
- TV auctions. Auctions of collector cars are blossoming all over the TV schedules. Their live attendance figures are also going up rapidly, and with good reason. Attending an auction, if you are a car nut, is a thrilling experience, even if you’re not a buyer. I stood outside at a high-end auction in Monterey in 1997, and it was a magical evening. You could watch for free as the cars were driven into line to enter the building, and listen on a PA as they were auctioned. My friend and I had a delicious time speculating on what each one would bring, and I can still recall the evening in great detail two decades later.
- Modern cars. Almost all modern cars are, to someone interested in driving, stupendously boring. Most people do not care about cars, and the manufacturers, perennially chasing sales, are hell-bent on producing cars that ask for no involvement from the owner, either in maintenance or driving. When autonomous cars get here it will be sort of an anti-climax, as great masses of the driving public know virtually nothing about their vehicle and do not want to. It needs to start and run and go about its business and ask nothing of the owner.
So let’s say you are in your 4th or 5th decade of life. You want to purchase a car that you – just want. A modern car of middle to high spec will probably cost at least $50 – $60,000 dollars. For that money you can purchase a good example of whatever you lusted after as a teen. Right now the value of 1980’s Corvettes is ramping up for that reason. There is a gap in the market for most 1970’s cars, as that was the initial stages of anti-pollution controls and safety equipment, and most of the cars were not inspiring – even when brand new. If you wanted a nice 1976 Chevrolet for some inexplicable reason, you should be able to get there for well under $20,000.
If you’re interested in ecology, the most damage to the environment a car will ever make is in the initial manufacture. All the exhaust pollution and poor gas mileage in the world will not equal the carbon footprint of manufacture. You could drive a 1977 Cadillac for years before approaching the crimes to the earth committed by building one Toyota Prius.
Or you want a big hit? A 1969 Camaro is lusted after by many. A good to great 1969 Camaro 396 SS with a 4 speed, restored to stock, will probably run $60,000. That is a lot of money, but not when compared to most current luxo-SUVs your neighbors are buying.
For that you get a car that looks great, but is also nose heavy and handles like a modern truck. However, you can consume a set of rear tires while not moving forward, it that is what you always wanted to do.
Cue the rise of the “resto-mod.” This is a classic car shape, such as an early Corvette, Mustang, or Camaro, with essentially a new car built underneath it. A well done resto mod will outperform, in speed and brakes and handling and creature comforts, the original model. By a long way. Because they tend to be much lighter, they will also run circles around the current model whose mechanicals they have borrowed.
I have my lottery eye on three of them. A 1965 Mustang fastback, a 1962 Corvette, and a 1969 Camaro. All are top-end resto mods, and to park them in the warehouse I will rent will set me back about $400.000. Or, the price of a mediocre Ferrari.
Come on lottery!
Copyright 2014 David Preston