Most of us know that a new car almost immediately loses in price just after leaving the dealership. Thus, normal cars are just an expensive buy never making an investment at all.
At the same time, some cars manage to increase in price several times not only offering the joy of owning and driving them, if one ever dares to take his or her investment gem on the road, but also making their owners richer.
Sometimes it is not even 100-200 percent but thousands of percent like in the case of iconic classics made in the last century. Those cars were priced below $50,000 thousand when new and now are skyrocketing to millions of dollars at recent auction sales.
Cars that Appreciate in Value
At the collector car market, muscle cars show the best appreciation, boasting high performance and special technical advancements. Not surprisingly, many of them were made in America, including Ford Mustang, Chevrolet Camaro, or Dodge Charger, the latter being one of the most sought after cars in the U.S.
But what makes a car a true collectible is its rarity. A car for investment must be made in limited numbers, and have some unique features, making it stand out. In this respect, American cars lose to European manufacturers — Ferrari, Porsche, and Aston Martins were never made in such numbers as Detroit iron, and the limited supply of the former drives their prices much higher.
The next thing, which boosts value, is when cars are featured in the movies. James Bond saga could be as important to the popularity of Aston Martins as the brand’s racing victories. Ferrari had its own James Bond in face of the race driver and Le Mans winner, Steve McQueen, who was a great fan of the Italian brand. But red stallions were not the only car which benefited from McQueens’ liking for fast cars. After Steve’s chasing scene on the hills of San Francisco in the famous Bullit movie (1968), Ford Mustang was never the same again.
Another aspect shared by the most collectible cars is their race heritage. Ford GT winning Le Mans in 1966 made it immediately coveted by car collectors. In the same way, as almost every model of Ferrari, Lamborghini, and Porsche are synonymous with races, these cars always ignite a lot of interest and attract the highest bids.
Where to Buy Collectible Cars?
Same as with arts or gemstones, the world of collectible cars is full of scams. Offers of cars restored from a wreck with non-original engines or parts are ubiquitous. Finding a car in original condition with low mileage requires many hours of research as well as technical and insider knowledge.
You can find the best cars for investment at top tier auctions including Bonham (UK), RM Sotheby, and Gooding (Pebble Beach). These auctions sell exclusive collectible cars and are key events for classic car aficionados. As a rule, the cars sold during these events are comprehensively documented and thoroughly checked both for ownership and technical state, which safeguards the investments. At the same time, the level of service and prestige of these events command high commission and top prices affordable mostly to affluent buyers.
But these top events are not the only places to get a classic car, especially with a lower budget. Although smaller local auctions include many non-original or customized cars, it is not uncommon to find there rare collectible cars at lower prices and with lower auctioneers’ commission.
Finally, many deals are concluded privately directly among collectors. These require the most due diligence. full documentation, and, preferably, the assistance of experts who can make all the checks and guarantee that you get exactly what you pay for.
What it Takes to Own a Collectible Car
Special design, race heritage, and technical innovations make car investors spend hundreds of thousands of dollars. Meantime, the costs of owning a collectible car often include more than just the price of purchasing, maintenance or, God forsake, repair.
Driving older cars may be quite different from what is expected by those accustomed to the technology of today. The dynamics of cars made in the 80s would be not that superior to the characteristics of, for example, Ford Focus RS, which accelerates to 60 mph during the same time as epitomic Ferrari Testarossa. The safety standards, driver’s comfort, electronics (if any) of collectible cars are also far outpassed by modern automotive technology.
Meantime, a classic car calls for special care in order to grow in value. You can hardly expect it to bring you millions of dollars if you are going to use it in street racing or as a daily commuter. At the same time, finding reliable mechanics can be a challenge even for a Toyota Camry, not to say about the 20-30-year-old supercar. Such servicemen shall have expert knowledge and special tools to work with particular car make and model.
Finding spare parts for rare older cars is another story. Actually the more original parts and the lower mileage the car has, the higher is the price tag. While the cost of the least expensive original Ferrari part may well exceed a thousand dollars, it may be even more expensive with cars that are no longer manufactured.
Summary
Unlike regular vehicles, collectible cars grow in value year after year, similar to other investment assets. Their rarity, race heritage, and association with movie stars and celebrities add to their value and prestige of their owners.
Investing in classic cars does not only require enough resources to purchase and take care of a rare vehicle but also calls for running proper due diligence when buying, keeping the car in mint condition, and finally choosing the right moment to sell to make a profit.
Ownership of collectible cars has many similarities to possessing objects of art, offering stable appreciation when all other conditions are met. Still, the majority of the car investors agree that the real reason for having a collectible car is never the expectation of profits alone but an unforgettable experience and the pleasure of owning the real piece of automotive history.
Leave a Reply