Collectability v. Volume by Michael Sheehan.

I call mine the Furor. Thing about the ring investement, its one you personaly will never recover the capital on let alone the appreciation, even if it is far better investment than a car. Unless of course you recover the investment in a ring its by other means.

 

I think he loves to drive the news ones, but argues that they're not collectible. Unfortunately, the guy buying the Aperta isn't just looking for a fast convertible but also presuming he bought something significant. Ditto the 599 "GTO". So, the money does matter.

Exactly.

Rarity is overrated.

Certain eras are more collectible. If you want timeless stuff likechrome-ringed, real analog gauges, metal-spoked steering wheels, engines that look like engines, etc., you aren't going to find those in a new car showroom in 2013.

+1000

Anyone who paid $450K+ for an early 599 is going to be lucky to get half that now even with very low miles. And, 20 years from now, $200K will probably buy a 599 plus a spare for parts that Ferrari stopped stocking.

 

The element that I see driving up the "common" cars in time comes from repair versus sell or half-@$$ things to keep it. I love to use the 928 as an example of this.

When new, the car was aside from the 911 turbo the most spensive car in the lineup. First owners were doctors, professionals, business owners, etc. Over time, the complexity of the car and the high costs of the parts eventually led to owners that would rather sell the car than pay for the $$$ repair. This was the inflection point. The guy that bought this car paid peanuts for the car with the intention of fixing it.. because he (and the owners are all male) always wanted one and now it was $5500 with a blown tranny. He buys it and then finds out the car is cheap but the tranny still costs $7000 to fix / engine costs $6000 to fix because the belt skipped. So it sits in the back yard covered by a tarp for years and years until the wife tells him to sell it. Which he does and only gets $2000 for it. To the next owner that half-@$$es the repair with Chevy parts. On and on this plays out until the cars value, due to parts costs being beyond subsequent owners, drives down the price of the car in the secondary market.

Will this happen with in the used later cars such as 360, 430, etc... especially as the parts are harder and harder to obtain? I argue on some level yes. OTOH the ferrari owner is entering with the expectation of high prices and high overhead costs so it may not play out. I think it's still proverbial beauty, and latent teenage desire that drives the market.

 

Except a mint 928 if you can find one with low mileage is 100K. As the population depletes these things become more prized.

But yes the complexity of moderns may push them down the food chain. Especialy as its their very tech that makes them relevant in the first place, what happens when the tech is old expensive and outdated. What hhappens to old video games.

 

hi Dale, I am not trying to single you out, you just happened to post on something that I wanted to address, but you beat me to the punch.

Now let me preface this with... THIS IS JUST MY OPINION. This is not gospel, hardcore facts or anything. My comments are just as subjective as MS.

He said collectible. Not investment. also referencing stamps coins etc... collectible does not have a correlation with specific value(s) being high or what seems to be referenced... the highest price. I agree investment and collectible are to different things, but he stated collectible.


I will also share my opinion which nobody asked for of... I disagree with his article. I would say that they are collectible. I deal in classics car on a daily basis, and to be honest, this years new hot item is 30 years from now classic collectible car.

Referencing that todays Ferraris are not collectible because the next Ferrari is always the latest and greatest puts previous cars at a disadvantage... umm... im pretty sure Ferrari didn't build say the testa rossa or the 250gto and say... well guys... thats it... from here on out build them worse. We have reached our pinnacle. Stop pushing development forward. Stop trying to be faster than the last car we produced.

The next cars are always better or faster... but that doesn't mean the previous cars are less desirable. Faster is a measurable fact, desirability is a subjective moving target. Desirability is what I personally feel makes cars collectible. Otherwise, I guess a veyron is worth more than a 250 GTO because its faster. Or if we want to measure it with "period cars" a shelby daytona coupe should be worth more than a 250 gto because it is faster.... and while that is being said a daytona coupe is 5 to 6 times more rare than a GTO. So if we are going by the numbers... the shelby is worth more.

Concerning production numbers, I think production numbers are all relative. In this day in age, the market for these cars is MUCH larger. There are Billions of more people and many more countries that would consider purchasing these cars. The markets have grown but the numbers of cars vs buyers are probably (ratio) is probably the same. Also, no manufacturer builds one off cars anymore. They can't. They can't for legal road use in the US. That era has come and gone. So I personally think 500 of this or 80 SA Apertas will be collectible because in terms of mass production they are rare. Then factor in 80 for the world and you only have a handfuls to certain country's. or handfuls in rhd etc...

Remember, a GTO was once a useless piece of machinery it was left in a rose field and became the shop car at a high school... Kids that have a Aventador or GT RS will eventually one day seek the actual thing.

My argument is, what is collectible is subjective. It is not determined by numbers. The previous posters example of the 65-66 mustang is a great one. They are collectible. They are not extremely valuable but they are collectible. Edsels and peerless GT coupes aren't ridculously valuable due to lower numbers built.

If he really wants to open a can of worms... what worries me is... will the children of modern time want these classic cars that leak and smoke and dont run and cost the price of a carrera GT or F40 to restore, that have ZERO connection with these cars through memories. Will they want them? Drive by your local high school. There are less performance cars in the lots, they have been replaced with hybrids and the what not. The future of desirability and collect-ability may change. Who knows, if there was a secret GM EV1 still lurking... there is a chance it could be the next "722 SLR" (i cringed the entire time typing that) I think the chances are low... but anything that is subjective can change.

 

Well put.

I think there are still plenty of kids who like hot cars, they learn about them and their specs on video games, its a thrill for them to see one in the fleskh. But for kids today the cars are mostly unobtainable cost wise, and even if you can get your hands on some decent machineary there is nowhere except atrack where you can really explore it. Therefore cars are desireable for many kids, but not a practical priority.

 

One reason the 328s are doing so well is they don't have nearly as complex electronics and other difficult to work on systems as many of the later Ferraris. The newer models some years down the road, with certain options, , are going to be a tough sell, when people are looking at a car that needs a 25-30 thousand brake job(CCB's), or the F-1 transmission is messed up and the potential buyer knows that is $25,000 repair bill. Many of those cars will wind up at dealer auctions, or on the vast wasteland of Ebay. I was at the RM fall auction in Auburn Indiana, last yearl. Believe there were 8 or 9 Ferraris there, only found 1 car that had the service records, the rest of them, no records, and no one around to answer any questions about the history of the cars. Not real inspiring to bid on those types of cars. As they say, "A pig in a poke"!

 

True. Frankly speaking, I don't understand the whole collecting thing. I guess I don't have the gene. Even when I was a kid I brought baseball cards for the bubble gum. So while I think it is cool that someone like Leno owns a jillion cars, I wouldn't do that even if I had the money. The reason that I brought and sold three Ferraris (550, Stradale, GTC) in five years was because I wanted to drive them, not look at them.

And if I was going to buy a Ferrari today, I'd probably get a F430 coupe (I don't like droptops. They mess up my hair.) I have heard that the F458 is a much better car, but I can't afford to take a $150,000 depreciation hit. The point is I need to watch resell values because I need to keep my powder dry. That is, I was told a long time ago that the most expensive luxury car you will ever buy is the first one.

Given this, I understand why Ferrari guys are so sensitive to the perceived values of their cars. This is an expensive game we play (although golf in the long run is more expensive, at least that is what I told my wife.) However, I think it is bad form to fall for your own con. So all you Boxer guys? Enjoy your cars. Have fun, but don't kid yourself. A Boxer is never going to be a F40.

Dale

 

Don't kid yourself. I heard the same thing when fuel injection replaced carburetors. All of you who think F360s are going to be electronic junk in 10 years are delusional. There are already after-market fixes for all the gizmos.

And then, there is the reality that a F360 is such a better car than a 328, that it isn't even funny. Look, I'm not bashing the 3X8 cars. But you're drinking kool aid if you think that average condition 328s are going to sell for more than average condition F360s. The Luca cars are light years ahead of the Fiat cars.

Dale

 

Well a 328 is already worth more than a 355 which is suppoasedly a way better performing car. Last I saw good 360's are in the mid 60's whereas a good 328 is worth more than that too.

I think you miss the whole point about fun to drive viceral machines. But thts cool there is a buyer for every product..

Its not how fast you go, but also how you go fast.

 

I have driven both cars. there is no comparison of how the 360 handles vs the 328. 360 has more torque and better turn in IMVHO.

 

Way better. I mean, come on. Even Ferrari builds better cars with each passing year. I would not expect a 1987-1989 car to be any where close to performance to a car built over ten years later. And by performance, I'm not talking about 0-60. I'm talking smiles per mile. I'm talking about seer outright fun, and air conditioning to boot.

Dale

 

I need to see hard proof of this.

Dale

 

Just to put my cards on the table, last year I drove a 599 HGTE. On the highway mind you, not on a twisty mountain road. Great power, very easy to reach 100 mph with a lot more in the tank. Didn't do much for me. Didn't feel like what I think a Ferrari should feel like (looking for some drama here). Maybe an aftermarket exhaust would have helped. Maybe I would feel differently about an F430. From everything I've heard, the 458 is a blast.

Just sayin'.

-F

 

The V12-GTs need a stick. Floppies are wasted on those cars. The F430, on the other, is a pure on sports car. Like you, I haven't driven a 458 (hint, hint), but the only thing that comes close to a F430 is a GT3. The F430 is that much better of a car than the F360.

Dale

Oh, I guess I should something about how your mileage might vary and no animals were harmed in making this post.

 

You're making the assumption that a modern car like an F12 will age into desirability the way a 250 GTO did. The chances of that are basically zero.

At some point, Ferrari, Mercedes and other high end carmakers stopped producing handbuilt cars with simple carburetters, gearboxes and engines. Cars of that era were art, and infinitely restorable.

No one makes cars that way anymore. That's why the top European sports cars of the early 1970s -- Daytona, 246 GTS, Porsche 911S and RS 2.7 -- have been priced to the moon already.

I think Sheehan's pretty much spot on. And, he's been in the market long enough to know. Invest in classics, drive the wheels off the modern stuff.

 

I appreciate what you have to say even though we don't see eye to eye.


But i would refer back to are we talking collectibility or value? Two different things...

RE your comparo: an f12 and 250gto are not apples to apples. well nothing is compared to a GTO (im a self proclaimed 250 GTO nut!). But, a 250 GTO was a homoligation special of a somewhat road car. a 288 gto is more in line with a 250 gto. or even an sa aperta due to limited production and more "hand built". The F12 is a standard road car. sort of like a 250swb street car, which one could argue is not as collectible or valuable as a gto. Get my drift?

Personally i think one of the biggest reasons a GTO is so valuable other than its sheer beauty... is it was one of the last cars that could be driven to lemans and ran. It could even win at the track and drive home. It is a sweetheart of a car to drive and it handles very well and and is easy to maneuver quickly. You don't have to be Michael Schumacher or Phil Hill to get a good drive out of it. It is multi functional. You can be a billionaire and drive it to lunch. A bit more difficult to do with todays lemans racers.

Having said that if you want to compare a 250 GTO to a modern car... I think you would have to pick the MC F1. Closest car to a GTO in my opinion. A breath of fresh air, a car that could be driven to the lemans (detuned) and win. Doesn't take a bunch of engineers to start it. has three pedals, and 12 cylinders. timeless looks (GTO is still far better looking but for a supercar from the 90s the F1 shape still looks good and current) Limited numbers like a GTO. Rising in value quickly as well... That car while expensive is still able to be worked on and even driven by common man.

Personally just because, Sheehan has been publishing and writing as well as brokering cars for a very long time doesn't mean that he is absolute. As your financial advisor says past performance does not guarantee future performance. Desirability and collectibility is subjective. Things that are subjective are dynamic and move. If you aren't moving with them (and im not saying he is not, im just saying a prediction is just that) you may find yourself the way of some of the former largest companies in America... anyone remember the camera giant Kodak? The rental movie business Blockbuster? The appliance store Sears? Some could argue Microsoft? Remember when we used to Yahoo but now you google... hell... google is like xerox... for the younger crowd myspace vs facebook? Hell if you want a new car example a 67-68 mustang was worth less than a 65 or 66 until gone in 60 seconds was remade and Elenore was created. Or how about white ferraris once a curse, now more valuable than some colors.

I am a classic car guy through and through... but with fewer people knowing how to even use a damn drill press, or even know what a metered fuel leak is (carburetor) and that fewer memories are being created in the cars due to them being parked and not driven could potentially make them less relevant. How about people who know how to use an english wheel to bend a new replacement fender for your classic? How many of these skilled craftsman will be around in the future? Will we have people to maintain the hobby? Or will it just be filled with old rich guys who spend there money on things that leak, smoke, run on antiquated fuel if they run at all, and are slow and unsafe compared to more modern machines. At least todays machines are made with modern techniques that will likely still be in practice in the future. So there is a chance more modern cars could be restored. I don't see why a 550 or 355 430 360 etc... couldn't be restored.

Take a look, I know some guys who have sold some of the most expensive cars in the world and have been trading these cars since the late 60s. The guys who have been in the business forever and have created massive client lists (including sheehan) are being called by their very own aging clients and telling them to sell off cars before they die that way the kids don't have to sell them on there own. Car collections can be burdensome to kin. Some kin resent there fathers collection because they spent too much time or money or both on the things instead of on them.

Relevance and desirability may change is all im saying. i don't want it to. I wouldn't want to live in that world. But, we, me or sheehan can will it into submission. you can write whatever you want, but the market will speak louder. it could shout in his corner... it may not.

Concerning the cars as art... well... you could probably guess I was going to say this... but again... which cars are art in which ever era you are in purely subjective. Actually people who are truly art aficionados will tell you that a car can never be art... because it serves a function other than art. Art must only be art. (I disagree with this, I personally think a colombo V12 is a more beautiful thing than any painting or sculpture... the beauty of this "sculputure" is that it makes a beautiful noise, has many moving parts working in harmony, and even has a smell... it touch's more senses than any piece of art can)

I do agree, invest in classics (keeps me in business ha ha) and drive the wheels off modern stuff... but that is pretty obvious... i don't think anyone is buying an f12 or 430 for that matter to hold onto for a few years and make money... I don't think holding on to something that is depreciating is a wise investment. If you do, im sure some people in 07 would love to sell you some mortgage backed securities. New automobiles are not investments. They belong on the expense side of the ledger.

ok thats long winded enough

again, just my opinion. Mine differs from yours and Sheehans and thats fine.

 

one could also make the argument that the cars from the 70s are on the rise and increasing in value now is because they are becoming relevant. people of that era can now afford the car that they wanted and had memories of dad taking them to school in that car etc... Also, the collector car buzz has brought them up. The high value of 60s cars brings up the cars in the 70s because there just can't be that big of a price disparity. high prices of cars bring the cars around them up. Its a fact or rather its a trend.

prewar cars were popular and at one time the cars to have at a concours
tri 5 chevys became popular
60s sports cars and muscle cars increased in popularity
now 70s cars are now getting popular and thus more valuable

is there a chance the 80s are next over time? (that will be a dark period lol)
then is there a strong chance the 90s are next (i would personally bet on this especially due to the large amount of "car" people born in the late 70s and 80s and the reemergence of horsepower wars starting in the 90s. In the 90s the performance car was back!)

so to say 90s cars and later cars wont be collectible... I think there is a chance for this previously pointed out trend to continue.

 

Agree with Dale. As with 928's, don't confuse the one outrageous asking price low mile Wilhoit example with the average selling price. Last 328 I saw on ebay was asking $35k, $39k asking cars.com. 355 is also commonly known as being much harder on the wallet with upkeep despite what it's owners may claim. "Good" 360's with equivalent miles and "Condition" in the 60's compared to a museum 328 versus a museum quality 360 in the 80's. Not an accurate comparison. Sounds more like 328 with 50k miles going for $30k, with equivalent 360 going for $50-60k. Not apples to apples. Like "pristine" Wilhoit 928's, the outrageous asking prices sit for years.

 

The moral of the story, drive your cars, because they're going to depreciate no matter how little you drive them.

 

Fantasy Junction has an '89 listed at $74,500. Yeah, yeah, I know, asking price vs. selling price. Let's check back at the end of the summer to see if this car is still sitting on the lot.

-F

 

Fair enough, but the 250 GT SWB is one of the most desirable cars in the world. Handbuilt, simple, design unfettered by safety regs, engine unfettered by smog regs. Infinitely restorable. It's a case in point of why a 1960s Ferrari is a "forever" car.

Whether the F12, 612 Sessanta, 599 Aperta or 599 "GTO" or "Alonso" will be an asset or liability in 30 years, however, is open to debate. Machine made, technology-centric, no racing credentials, sold specifically to live under a car cover. As you can tell, I'm pessimistic on these, as Sheehan is. Very complicated, little significance beyond the window sticker. Drive them now as great cars? Absolutely! Long term? No way I'd put serious money into any of the new stuff. I would buy something like a 360 as an entry-level driver to use up, because it's fun and I wouldn't worry about it.

No one in the classic car space cares that they're slow, or lack emissions equipment, airbags, etc. When my 1956 Porsche needs fuel, I take it to the same Chevron station as my new Audi and it runs fine. As long as someone knows how to turn a screw, gap a plug, adjust a clutch cable or set points, the car should be racking up miles long after I'm gone.

In 30 years, OBD II technology is going to be gone forever, and the proprietary electronics and components in early F1 gearboxes, early ABS, etc., will be unobtainium. Perhaps some guys will be interested in restoring the F1 pump for a 355, but I suspect mostly the cars would be salvaged. Yes, it takes a skill set to properly mend a fender on a coachbuilt Rolls or Mercedes (or Ferrari), but it's metal and we've been working it for thousands of years. A thousand years from now, it will still be a piece of metal.

Again, I don't buy that you can compare an F430 to a 250 GT SWB and equate their 30-year valuation curves. Looks at the parts lists for the two cars, and imagine fabricating all of those in 30 years. (And keep in mind some of those parts are "replace only" even now.)

I think it's less subjective than we assume. Is an original Nardi wheel more artful than a carefully engineered 355 steering wheel with an old-gen airbag casing? Yes. Is the original 250 California Spyder better proportioned than the new California? Yes. Does the Dino 246 look better than a F430? Yes.

What we do see now are design throwbacks, where modern plastic-bumpered cars still feel compelled to adopt design cues from the classic era -- to the point where the 355 and TR had fake eggcrate grilles. The 550 was designed to recapture the 275 GTB, and mostly succeed.

And we probably agree that cars are a form of art expressing motion. All of you have to do is park something like a Lexus SC430 or Subaru Juke next to an E-Type, 250 GT SWB, etc. Cars can be appliances, the designs of the classics very often reflected art, because there were relatively few functional requirements back then to compete with form.

Prewar cars are still automotive royalty. Significant cars like the Alfa 6C, Duesenberg J, Bentley blowers and others command big bucks. Merc 540K's -- massively desirable, at or near the top of all collectible cars, and everyone who bought one back in the day is now dead and not buying.

Again, I don't buy the notion that nostalgia sustains a market for the long term. If that were the case, 300SLs would be affordable and 560SLs very expensive.

It's a matter of the current classic cars being important from a design and historic perspective (the era of road car as racer), and a purer driving experience.

 

Yep

Fantasy Junction always has fantasy listing prices (sorry). Moreover, #1 cars will always go to collectors at silly prices. The comparison I'm looking for is a #3 v. a #3 car.

Dale

PS Almost all used Ferraris on the market are #3 cars, despite what their current owners might think.

 

What would you guess is the average age of real buyers of '60s Ferraris? Moreover, how old do you think these guys will be in 30 years?

Enzos sold initially for $600,000. Prices then doubled to twice that. And this for a car that most people consider to be butt-ass ugly. Bottom line is Ferrari supercars will always be collectible.

Now, the production GTs? Different story. They will bottom out at around 35% of MSRP and then slowly climb back up, much like the Daytonas and C/4s.

You might want to check with Brian Crall and Dave Helms on this point. They might be surprised because they are already doing this.

Face the music, my friend. We're old. What you and I consider to be beauty and what the next gen think is cool is going to be very different things. For example, I believe that a 1970 Triumph Bonneville is one of the most beautiful motorcycles ever made. But my X'er neighbor down the street wouldn't even give it a second look.

Times change.

Dale

 

Sorry, but this is just flat out wrong. There is so much more documentation of every little aspect of the newer cars and technology is evolving so quickly that a 5th grader will be able to program a PLC (or whatever they have in 30 years) to control any aspect of these cars then. It's possible to completely get rid of the motronic system in a 355 and replace it with an off the shelf ECU that can add traction control etc. for a few thousand bucks today. The 355 isn't even 20 years old and the electronic systems that are on it are laughably simple, the same will be true of the current cars in 20-30 years. There's already a work around for the f1 pump (use a 360 pump) and they can also be rebuilt, it's just a pump. I actually saw the controller and software for the 355 f1 setup when I was at Ferrari NA around 2001. I've written more complicated code in visual basic in an afternoon to automate a spreadsheet. The nice thing with the newer cars is that they are more software and less hardware based, which is even easier to update later on as it's just a matter of programming new hardware to do the same thing instead of emulating hardware with software like you need to do with some of the older stuff.

I'd have a much easier time working on my 355 with the vast information available on it and the diy community than I would a 250swb - and I grew up working on carb equipped muscle cars. It costs probably 50-60k to rebuild an engine in a 250swb, where I could completely replace every electronic unit in my 355 with modern equipment while adding traction and stability control for less than half that.