is the bubble due to burst?

Ford just announced pulling-out of Japan & Indonesia as "younger generation just not that interested in cars"; Ford only sold 5k units Japan & 6.5k Indonesia last year, mainly due to Japan's "closed auto market" etc etc.

Jack

 

that is interesting. obviously a different market, but i was in taipei last month and there is a thriving exotic car culture there. i am expecting a good number of the upcoming ford GT's to end up in the pacific rim.

 

Thank you for the clarification.

You would not want a degree in engineering as engineering does not have anything to do with repairing old cars. You are not designing anything when restoring cars. You would be much better off getting a proper automotive technology education.

The school I teach high performance engine design classes at, DeAnza College in Cupertino, has a three year automotive technology certificate program or you can get three associate degrees if you put in another year and a half for general education classes. That's about the same length of time it would take for you to get a bachelors degree.

There is a myth that the engineers and the mechanics skill set are the same. Mechanical aptitude is something that is developed over time and few engineers are turning wrenches enough to develop it.

That being said, as the number of people who can work on old cars declines the demand for them would go up so I think it is definitely a career that is viable into the future.

There are no carburetor classes taught in my area anymore. I do not know what school across the country are teaching it. Unfortunately to get it right you need to have both a theoretical understanding of them as well as a lot of experience. Unless you work at a carburetor shop, you are not likely to work on carbureted cars day in and day out.

 

Getting back on topic....

Here is an interesting piece on "softness" in the art market.. While the auction houses continue to make big news on record prices for "old masterpieces", there appears to be less demand for newer works, and Sotheby's lost $12 million on guarantees that it made in selling the Taubman collection.

In the auto world it parallels very much what we are seeing in that highly sought after cars like LM's and SWB's are still going for record prices, while the lesser cars have stagnated and are rolling off in value.

Christie's Sales Fall 5% as `Froth' Comes off Global Art Market - Bloomberg Business

 

All these collectibles and commodity markets remind me of pistons in an engine: when one is going down in its cycle, another is rising. Below is a link to an interesting graphic developed by Macquarie Research relating to commodity cycles. It appears that Diamonds are near TDC while Oil is near bottom and Palladium and Zinc are poised to rise.

In a similar vein to Macquarie's commodity chart, I would speculate that the classic car market is currently around peak prices and market balance point. Upcoming car auctions will indicate when and if the market moves from this point.

http://edge.alluremedia.com.au/uploads/businessinsider/2015/12/Macquarie-research-dec-2015-commods-outlook.jpg

 

If you think about it, only the more valuable cars are worth restoring at this point from an investment perspective and that was how a lot have buys have treated these cars over the last couple years. Simply as an investment.

If you could buy a 250 GTO for $36 million in basket case shape it doesn't matter how much you spend restoring it if you can get $50 million for it perfectly restored. Even if you spent $5 million on the restoration, it would still be worth it.

If you had a lower end Ferrari in not so good shape that you paid $50k for but it's only worth $100k, it doesn't make a whole lot of sense to spend $100k to restore it because then you are $50k in the hole.

We saw a lot of very low mileage Porsche 930's that had been stored. I probably restored 25 of these that had below 20k miles. Some that were below 1k miles. Time will kill a car faster than miles. On average, we would spend about $30 - $60k to get them back to as-new. You would think that at 1000 miles the car would be perfect, but that was rarely the case. As I was leaving there was a 930 in the shop that had about 1800 miles on it and I think that bill was already up to about $100k.

 

Was this 959 an anomaly? Or was this something that has happened over and over again?

 

At least one more...the 1980 512 boxer red/tobacco interior out of Canada offered 2013. I flew to Vanc to inspect car at Ferrari of Vanc (Nov 2012) found out car when owned by Les Groberman had slid off the road thus needing close to 100k in repairs (owner of body shop who did repair meet me at dealer to discuss) btw, car was originally black w/tobacco, Les re-painted it red (that is how car derived it's "rare color combo", lol).....car was sold by MS to Canadian owner (D.R.) who knew nothing about wreck and/or black to red before HE bought car several yrs ago. Mind you, D.R. was a repeat MS customer!!(365 gtb/4)..well you should have seen his face when we all gathered 'round the car to discuss...he was speechless....given this new info, I offered accordingly and ultimately passed on car. Well, imagine my surprise when car ended up @ B.C. with NO mention of this at all. IIRC car was discussed on boxer thread with many favorable comments to the effect of "B.C. sure gets some great cars". Mind you this was when bb's were just starting to accelerate in price and it was marked-it accordingly (350 or so)...one remark was to the effect of "well, B.C. does lead the market" (ne price) !! You just never know......it is always a Jungle out there.

Jack

 

So in the above example, you believe that 2 different dealers/brokers omitted material information about this car when presenting it for sale? Wow, just unbelievable, especially when they were asking probably all the money in each case.

 

1000% on the 1980 red/tobacco boxer

would LOVE to hear some stories from our "inside guy"....but understand why he may not. I think it speaks to his integrity that he left B.C. and is now running his own shop. Maybe he got fed-up with all the b.s. that CAN and DOES go on.

Jack

 

Great comment.
Refreshing!

 

I can't stress this enough with old cars. Grease dries out and causes mechanisms to stick. Plastic bushings turn to chalk and disintegrate. Paper gaskets shrink and leak. Electrical connections that have not been subject to the shaking a rough road incurs become oxidized at the point of contact. Anything rubber oxidizes until it is hard and has lost most of its original properties. Plastic interior pieces become brittle and warp with heat cycles. Glass de-laminates. They fall to the laws of natural decay.

I had the fortune of driving the #21 1964 250 LM that won Le Mans outright in 1965 - the last Ferrari to win Le Mans outright (I drove it in the parking lot only). The car had been plucked from the Indy museum basement after sitting there for 45 years or more. It was going to concours and needed to be able to drive under its own power to the spot it would be shown. The brakes were completely inoperative when it came in. After we finished repairing the brakes, my job was to test them to make sure it would be safe to take on the lawn. I had to bring it into the parking lot and do repeated panic stop from about 30 mph. The tires were hard as a rock and the thing would easily slide under the least amount of braking due to the hardness or the rubber. The moral of the story here is don't drive on extremely old tires. Keep them for the show!

 

Useful comment. But isn't the real moral of the story that we should use these cars not just store them. Driving them is the best thing you can do to keep them going

 

Useful comment. Re the carb issue my view is that there are enough carb cars out there to keep the skill base needed. In the UK there is a thriving vintage race car scene with the likes of Goodwood , silverstone classic etc that there are plenty of specialist race car garages to keep the skills needed to maintain simple things like vintage Ferraris

 

Absolutely!
Unfortunately we live in that market's obsession with "low miles" and even a desirable car has it's value shot with even very reasonable mileage.
My SA with 14900 miles would not be even accepted at Gooding or RM (as I was told by both reps)

 

Yes very true. Wow I wonder what the auction houses would make of the 70k km on my humble 550. I'd better hold on to it and just keep driving it everyday as I am doing Good luck with your 575 super America

 

By 400 miles, lol
Gooding is listing an '89 328 GTB with 14,500 miles

Jack

 

Assume it has an F1 box? Suspect they would take a manual one with those miles?

 

I like to work on my own carbs. You just need the right mindset and equipment.
A nice lazy afternoon, some jazz playing, and of course the proper carburetor fluid, a nice cool IPA in this case.

And the Webber tuning manual is a big help.
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I bet they would...

 

That sounds like a thoroughly enjoyable way to spend an afternoon.

 

Just a suggestion. I would really like to see these and your other comments in a stand alone thread perhaps posted in Technical Q&A or General Automotive, etc. since you discuss different brands and eras. Maybe call it "hpengineprep's stories of revival and restoration". And this thread can return to beaten dead horse of "bubble" or "not bubble" commentary.

 

Understood. However, the point I was trying to make was that there are more and more poorly restored cars on the market and I feel it will have a big effect on this 'bubble' as people are realizing it is hard to find a good car.

 

Anyone who has the cash can find a good car, but not everyone can find a good original car.

 

What is a Webber?