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Collector Car Values - Four Good Buys

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On: Tue, Sep 11, 2012 at 9:41AM | By: Jon Summers


Collector Car Values - Four Good Buys

For a few weeks each year in August, the entire focus of the collector car community falls on the Monterey peninsula, in Northern California, for the auctions, shows, and races which take place around the Pebble Beach Concours. This year Hagerty classic car insurance organized a panel discussion on car values – useful both to car guys and pure investors, since anyone who has been paying the slightest attention to the classic car market knows that values have been steadily marching upwards, and generally speaking have been doing a whole lot better than traditional investments such as property or stocks.

Rare, but not too rare

There are certain rules of thumb to apply to values in car collecting; as “Chasing Classic Cars” Wayne Carini put it, “production numbers is always key to collectability”. The ideal number seems to be between 25 and 1000 made: more than that and there is a sufficiently strong supply to weaken values – the example given by the panel was the 80s Ferrari Testarossa, with around 1300 made, while extremely rare cars suffer from their being no comparable sales to base values upon. The example discussed by the panel was a 1908 Simplex – there have only been two other Simplex come to market in the last few years, each were touring cars, not speedsters, plus the 1908 car is the oldest known Simplex still surviving. Without a meaningful comparison point, the value will be determined by how many and how wealthy the bidders are on auction day. Naturally, this doesn’t mean virtually unique cars cannot make huge numbers, just that from an investment perspective they are less predictable.

Usability

The panel highlighted the rise and rise of the Aston Martin DB5. This is the easily-recognized “James Bond” Aston Martin. Five years ago, values were around the $250k mark. Today, they are around $750k – show me another investment with a 300% return in the last five years! The panel made the point that there is consistent strong demand for these cars because they can be used easily, in that they are comfortable to drive and can fit into the twenty first century easily, both in terms of having reasonable performance and brakes, and not overheating in traffic. The same argument can be applied to the Mercedes Benz “gullwing” 300SL, or the ultimate collector car, the $30m Ferrari GTO. Each is a fun to drive Grand Touring car which was so good when built that owners today can drive them to and from vintage events. The importance of usability – either day to day or eligibility for particular events – has long been a feature of the collector car community, the best example being the relative values of veteran/brass cars: a car eligible for the London to Brighton run is worth DOUBLE a similar car made too late to be eligible.

Porsche 930

The panel was asked to highlight an entry level car which they would consider a great investment. The first car selected was the Porsche 911, specifically the models built between 1974 and 1989. The mid-late eighties 911 has long been considered a minor classic, with the last “G50” cars, equipped with a 3.2-liter engine and Porsche’s own gearbox commanding higher prices than the later, nineties “964” 911 models. The panel suggested that early Turbos – the 930 – will probably see an uptick in values first, since prices are often led by the biggest performing earliest cars, and the 930 is looking conspicuously cheap right now.

Jaguar XJ-S five speed

Doug Osborne picked the Jaguar XJ-S as a good future investment, citing specifically manual transmission models. The huge numbers of automatic transmission cars make these significantly less valued by collectors; by contrast the stick is very rare, and very good to drive. Both V12 and 3.6-liter inline 6 cars could be specified with manual transmission. The XJ-S is unloved and still very undervalued in comparison to the model it replaced, the iconic XKE, and Don feels for low mileage original condition stick shift cars are just beginning to climb in value.

BMW 3.0 CS

The panel also selected the BMW E9, commonly known as the 3.0 C.S. Many purists feel that this is BMW’s best design of the modern era, combining as it does coupe good looks with the signature BMW shark nose. The high, open glass house is aesthetically appealing but also offers almost total 360 degree visibility; it was the rollover protection legislation of the seventies which led to the 6 series, the 3.0 C.S.’s replacement, having thick and unsightly B-pillars. The E9 came with BMW’s quintessential straight six, an engine the company has spent the better part of a century perfecting, and many had manual transmissions. Today, it is not unusual to find cars with modern five speed transmissions, although obviously the collector community values originality over drivability. The E9 is also appealing since it has strong racing record, both in the US and Europe. A homologation special model, the CSL, was developed for competition purposes, and E9 prices are being led by the increase in CSL values, especially cars with competition history and the full “batmobile” body kit.

Fox Mustang

Generally, the panel was not optimistic about the muscle car market, highlighting only one or two cars which seem good value at the moment – for example 1969 Firebird Trans Ams. However, Colin Comer did mention the Fox Mustang as a future entry level collectable car – there is a new generation of car collectors today who grew up in the eighties and value these cars as the first performance machines to come out of Detroit since the muscle era. He was quick to point out that modified or tired cars are likely to remain flat for some time, selecting the very last of the carburetor cars, in original condition and period colors, as the cars a new generation of collectors would take an interest in. Comparison was made with the Buick GNXs and original, clean Monte Carlo SS’ which are also beginning to increase in value.


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Comments

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k2msmith | 11:33PM (Mon, Sep 24, 2012)

The information reported seems to be incorrect. The Porsche 964 has the updated G50 gearbox that was released in 1987 for the 3.2.



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