Ferrari Depreciation: Why a 50% Hit Means Nothing

http://www.sportscarmarket.com/articles/archives/1099

This bit explains it

"The Miracle of Depreciation,” the process whereby previously unobtainable automobiles are brought within the reach of the common man. Simply put, the first few years’ depreciation separates the truly rich from the simply comfortable. For those who can pay, the costs are moot, as those funds would otherwise go to a yacht or a third house or a Lear jet. While it may seem hard to justify a $100,000 depreciation, those who can, do, and those who can’t, buy used. ALL WE HAVE ARE MEMORIES"

Have to say I am the common man but mega rich guys I salute you.

 

Not sure I'd salute someone who makes bad choices with his money just because he has a lot of it.

Given unlimited funds, I think I would still have felt like a bit of a dupe if I had paid $500K for a 599 when they were the new thing.

 

Salute them in 2 ways I guess. Firstly for being able to have enough to not really care, more fool them if they cannot afford it. That would be dumb.

Secondly, I salute them for taking the hit so us mortals can enjoy it a few years later

 

how about salute them for purchasing new cars in the first place? Without them, there would be no demand, = no new cars sold, thus, no used cars....

 

Well put. Cars deprecitate. The end. But I would like to limit the hit as much as possible.

 

I have thought the same thing many times.

I would love to have a 458 spider when they arrive but no way. I will enjoy this one and wait a few years.

 

+1

 

Isn't it all relative? If you're making $X++ and you take a hit, isn't it the same as the average Joe making $X and taking a hit on a Toyota? Cost of doing business in other words. And, it all depends on what you're making?

 

That is why there are two types of exotic cars. The production cars like 360, 430, 599, gallardos, 911 tt, this class of cars are for us the comfortable owners. In the other hand you have the collector or limited cars like Enzo, F40, F50, McLaren SLR, Zonda, ect. Those are for the very rich guys. We are no more on the 80's when we dream with the Ferrari of Magnun from the TV series and the quantities of exotic were limited. I remember when I was a kid and saw just a Porsche I thought that car is only for a very rich guy, by the way I'm only 29, I can't tell about the 60's or 70's.

My two cents.

 

I've attached one of my favorite car advertisements of all time and though this is Fchat, I think you'll like it. Watch it until the very end. Happy New Year FChat friends!

http://www.youtube.com/watch?v=D09qQ_NM6QA

 

I must have watched that Ad 50 times..thanks for posting and Happy New year to everyone. Now you have made me love my 996 tt more..lol. Maybe i should keep it and buy a F430.

 

I wanted to post that ad for a couple reasons, first, it's a great ad, Porsche does such a great job in that department, second, life is short and a Ferrari is an emotional experience. Whether or not depreciation matters financially, buy one if you can. As the above ad states, "here's to the dreamers." Life is not always about being practical.

 

+1 on all points from another regular guy and dreamer

 

to those guys, half a million is like $30K to us so a "little depreciation" doesn't hurt.

 

It's all relative.

Ask Paul Allen if he's concerned about depreciation.

I was on a plane once flying from Dallas to Tulsa with a colleague. He's the cheapest bastrd I've ever met in my life; waiting for people to board the plane so he can walk around and pick up old newspapers, ironing his clothes from yesterday, wearing shoes with holes in the bottom, and missing out on the journey. He claims he'll retire and play golf all day.

Well, as we sat on this ATR as it flew through the worst storm I've ever experienced in my life, we all thought we were going to die. Our luggage was all over the plane bouncing off of heads and seats, people were vomiting, and some crying. I leaned over and said to my pale-faced companion; I've traveled the world, owned incredible cars, had the most fantastic food, lived like my life was something. You've saved every penny, missing the journey for the destination you may never see. Your wife will enjoy your thrifty ways now. He quickly stopped me saying; I've taken care of it. He goes on to say I told my wife if I die, I will haunt you everyday of your life if you remarry.

Stunned with his retarded response I tell him, if I make it, I'll marry your wife and spend all your money on cars.

Obviosly we made it to Tulsa, and back later that day to never travel regardless of what the stupid pilot wants to do during bad weather. Don't make your decision to fly based upon what the pilot thinks is safe. If I see black clouds, wind swirling and lightning--I'm headed to the office and the clients can kiss my ass.

Needless to say, my colleague has since bought a Mercedes, a new house (near me), and has started to travel a lot.

Life is short, don't be scared into having fun. Live now.

 

+1 totally agree.

 

Isn't this why we are all here?

 

Counterpoint - I really started living after a flight I was on almost bit the dust. People say flying is safe... until the **** hits the fan, then you'd prefer the % of survival in a car, versus all-or-nothing crashes of a plane. So I bought a beach condo & a Ferrari.

Since I was not born rich, this "enjoyment of life" ran out quickly. Between the housing market & car markets dipping, I lost my shirt!!! Now I have nothing and have to live the rest of my life in misery. So you tell me which is the smarter way to live. It's hard to revert to poverty once you've tasted luxury... but the old man in the story would never have known what he was missing.

 

sorry to hear that. i agree with you. people need to have some level of stability and the comfort level to enjoy cars like these. if money is an issue, people can still get their kicks out of much cheaper cars that can go faster than F or L. if my finances went down, i'd have no problem trading down from my Gallardo to an E46 M3

 

You have to have balance, in all things including living today. You can't live like you're dying with no care for the future but then we are guaranteed no future. An employee at one of former offices felt really, really sick and was encouraged to visit her doctor. Her doctor wanted to admit her to the hospital but she refused, went home, fell asleep and died at age 48.

My sister in law is an MD who lives like a miser so she can hurry up and retire then continue to live like a miser until death...BUT she won't be working. BFD. My job is relatively easy so I don't mind working at all. I am self employed so I am lucky in that regard to work as much or as little as I like even toward retirement. I will slowly cut my schedule over the years. I will not cramp myself in any way financially now with living a little.

People always think that one day things will be JUST RIGHT so that all their wishes will be fulfilled and they will finally be at peace and able to live it up. Bulletin. Things rarely happen this way. The final destination is death and we have to remind ourselves not to be in a rush to get there.

 

I -love- these guys who can and do take the initial hit. If it weren't for them, bottomfeeders like me couldn't get into these machines. Someone paid a dollar-corrected 150K+ for my 328 back in the day.

I just hope someone buys my favorite color combination so I can pick up an Italia in 2021

 

Hell, I salute even my pets. After all, to salute means to say hello or greet someone.

 

Sorry to hear about that, I hope you will recover again. That same thing tha happened to you happen to my brother.

I'm self employe. I live with one rule regarding money. When I start to doing good at my bussines I decide to apply one rule to myself. I calculate my bills and what I want to buy. When I reach that quantity I put my self a week salary ant that is enought to cover all my bills and hobbies. A don't waste any more in nothing that is not a good investment. My bussines is doing a lot better than my salary thanks to God. So beside my salary all the other incomes are going to a save account.

I really learn from my brothers expirience so I took all the good and the bad dessisions he made to my benifit. He is doing great now and learn too.

My two cents.

 

I have a very good friend who bought a 599 open market when it was new....the depreciation hit he has taken is about equal to what his investments earn in interest and dividends, after taxes, in one day...i dont think he feels at all like a bit of dupe...

 

I know of a guy who donated $30K to a Ferrari dealer, I don't think that he minds depreciation at all.