Maranellos are disappearing

I think we are seeing the beginning of the gradual, and ultimately terminal decline of the Classic Car market. Only the rarest and most special cars will be "investor grade" (I HATE that term - cars are for driving, not investing IMO) in a few years' time. Factors driving this trend are:

1. Younger people less interested in older cars, and in cars generally, especially urban dwellers (eg my daugheter who lives in London doesn't own a car and hasn't even driven a car since she passed her driving test 10 years ago).
2. Newer cars are more complex, will be more prone to electrical / computerish issues especially, expensive to maintain and will suffer from NLA parts (especially plastics) that fail.
3. Legislation that will ultimately force ICE cars off the road.

I have sold off almost all of my "classics", except:

1. My Bentley, which is worth peanuts anyway.
2. Me E-type, mechanically simple and for which spare parts are in abundant supply, new and seconhand, and which I suspect will gradually decline in value, but I don't mind because it gives me an immense amount of pleasure, so I don't care even if it is ultimately unsaleable: when I can no longer drive it, I shall just admire it!
3. My Mercedes CLK, which, at just over 20 years old is on the cusp of being a "classic" if it isn't already, but is in fact my daily driver and will probably continue to be so for the foreseeable future.

 

1. Younger people less interested in older cars, and in cars generally, especially urban dwellers (eg my daugheter who lives in London doesn't own a car and hasn't even driven a car since she passed her driving test 10 years ago).
2. Newer cars are more complex, will be more prone to electrical / computerish issues especially, expensive to maintain and will suffer from NLA parts (especially plastics) that fail.
3. Legislation that will ultimately force ICE cars off the road.

1. This is true everywhere and one of the major reasons why there will be way too many cars to keep them all.
2. Its only matter of time when some Raspberry Pi type generic computer comes along which can emulate just about any old automotive computer box. This and 3D printed plastic will keep old cars going if people have interest. At first they are for expensive cars only but price will drop enough for this to be non issue in long run.
3. Horses are still legal transport. When there is only one or two gas stations in town which sells synthetic fuel at $20/gal or $7/L there is no need for any major bans. Only true masochists will use horse or ICE for commuting to work.

 

One other issue is that economic growth has stalled in Europe especially, which accounts for a good chunk of the classic car market. When and if it comes back, it will be driven by a techy young Gen who are not sitting now dreaming of Ferraris. And the guys who are dreaming of Ferraris won't have the funds to buy them, because they are in dying industries - a manager at a piston manufacturer in Germany for example. And all the places with economic growth like Vietnam are no place to own a classic car. And the world's second biggest economy China doesn't even allow classic cars.

So that leaves the US. And I will leave it at that so not to get into forbidden subjects.

On the other hand, almost ten years since this thread started, who knows what will happen in 10 years. But our Maranellos will still be phenomenal to drive.

 

Bianco Avus FHP '99 550 re-listed on BaT, this time at no reserve. RNM @ $228K back in Aug. Originally sold in Japan, went to Canada around 2018, now at selling dealer in California. https://bringatrailer.com/listing/1999-ferrari-550-maranello-39-2/?utm_source=Iterable&utm_medium=email&utm_campaign=campaign_2461171

 

I'm selling a perfect UK RHD 575M Maranello, factory manual and FHP. A genuine no-stories car. I'm sure I'll regret it, and we'll all be saying, do you remember when you could buy one for less than $200K in 2024!
https://ads.ferrarichat.com/buy/575m-maranello/zffbt55c000134021#

 

The U.S. is - by far - leading AI, quantum computing, space/rockets, innovation in general. Plenty of brains and money will be here. And, our car culture is only expanding. Not worried long term.

 

The manual transmission is seen as prestigious among all the youngsters interested in cars. And the Ferrari gated manual is the pinnacle of shifting cars. Everyone wants one of these. It’s like a driving a v12 once in your life or other iconic moments. These cars will forever go up in value. Especially now that they are limited in number. 550 definitely an appreciating asset

 

Owning manual Ferraris as I do, I'd love to share your optimism, Bill and Charlie. And while there's certainly a cool factor in old cars and manuals among the young gen, so many of them are just not interested, or able, to share our passion. Cars are becoming appliances and there are just so many around. Unlike in the 1960s, when you had a tiny choice of a tiny number of cars, now someone wanting a glamorous car can choose between so many Ferraris, Bentleys, Astons, McLarens, Lambos, Audis, Porsches, AMGs, Ms, and all the electric cars. And while I love a manual car, pretty much every car was manual in most of the world til recently.

And those wealthy people in AI in San Jose and Shenzen and wherever else..I don't think they're lusting after Maranellos.

I hope I am wrong and you are right! And there may be enough people to keep this market hot.

One thing's for sure, 550s and 575s are demonstrably not appreciating assets. For a 550, Hagerty quotes $162k for a "good" condition in the US, not much change on 10 years ago; in Europe nominal values are quite flat over 10 years which means real values are down a little.

 

Trust me you’re wrong maybe only lambo or McLaren are on the level of Ferrari but Ferrari still edges them out. Ferrari is ranked the most prestigious brand in the world. Absolutely everyone wants one. I’m sure someone said all these similar things about the 50s racers in 70s but look how much they cost now

 

It's prestigious, but that doesn't translate automatically into residuals. Brand equity is based on newness and desire, with heritage playing its role.

Porsche is often ranked as high as Ferrari and you can get a 996 for £15k (that's pounds, but same principle applies everywhere). You can buy many models of Ferrari for under £50k: Mondials, 348s, 360s, 456s, 575s, 308s, GT4s, 400s. Their values aren't going anywhere.

There were handfuls of 50s racers made. There were 167 250 GT SWBs. 456 275 GTBs. They were the best cars in the world; pretty much; no Paganis or Bugattis or Konigseggs or P2s or LaFerraris or Valkryies or Sennas above them. There are tens of thousands of front engine V12 Ferraris made since the 1990s, and a surfeit of other supercars.

I'd love to be proved wrong, only time can show!

 

Of the ones you mentioned only the 456 is manual v12 and is like 100,000 in the states at least.

 

Also nobody really wants a Bugatti or a senna it’s only poseurs in Hollywood who care about those cars. The Bugatti is a volswagen product a Bentley super sport with 4 turbos basically and the senna is a 720s with a carbon body kit and boosted turbos. Nobody who actually appreciates cars thinks those cars are worth getting at those price points. The 456 is a bargain at its current price. I think future prices will reflect that

 

For YEARS here in the US you could barely give away a mondial.

I love a QV 308 but all 308’s languished until the Covid frenzy.

Your points make a lot of sense.

Plus what’s annoying is….remind me when Ferrari last had an F1 title 8-(

I’m grateful I don’t have to worry about values since I have the car I want and can’t fathom selling and the inherent value isn’t material in my financial situation (I hope we are all that fortunate).

 

The argument that the enthusiast market is doomed long term, and today's kids don't care about manuals is bizarre. It's never been bigger, and continues to expand thanks to social media/content, video games, the cars & coffee phenomena, pop culture, you name it. And, the brand continues to inspire, generation after generation, all over the world, and we're pretty sure they'll never make manuals ever again. Since future high earners and big dreamers are born every day, and they don't make 550s anymore, this isn't rocket surgery to figure out. Even for those of us who don't want or need to sell now or ever, for whomever we're leaving our toys to in the will, it's nice to know it's not a resale time bomb (like an Aston Martin or Bentley... or San Fran office space ;-)

 

Its annoying we can't easily change those office floor plans to condo's!

When I moved out of corporate housing into my first SF apartment I was at the Paramount at 3rd & Mission (good times)!

 

Hah! Big chunks of midtown Manhattan should convert.

 

Re: Maranello market future potential, this was in the last issue of Sports Car Market, FWIW:

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If we want our cars to trigger the interest and desire of the younger generation then the very first thing we should do is to drive them around so that the younger can see them up close and realise that they are not the impossibly complex and expensive to run cars that the wildest and most stupidly inaccurate Ferrari fantasies usually nurture. No they are not cheap but compared with the likes of BugVWattis they are a walk in the park.
Locking them to keep the mileage down (and cause reliability issues related to lack of use) is a very short term approach that will kill the desire that the young may have for these cars and they will buy something else that they saw in the street once they have grown up and have the money for such things.

 

I think the opposites true. People want the Ferraris because they are a unicorn. You never see them and you stand out. They don’t want the Tesla or the beemer or the lambo huracan you see every other day

 

With all the brainwashing that takes place with the ever increasing screen exposure people who want see through all the supercar spin will realise that 550s are real world, long term enthusiast cars very much unlike Huracan or other cars in the same vein which from the start were always going to be consumables that cannot hold their values over the long term because too many were made and when they will go wrong they will be dumped because they will be too expensive to fix when they will even be fixable. Vintage Ferraris like the 550 are down to earth high end cars of the Renaissance era for Ferrari and were never supposed to attract idiots who want to show off downtown on Sat evenings. They may be rare but have never pretended to be unicorns and people who consider them as such have in my opinion completely misunderstood them.

 

You’ll never see 550 on the road it’s really a special treat to see one

 

Very true, living Orange County, one of the largest Ferrari markets, I can't recall seeing any 456/550/575 on the road or Cars and Coffee in the last 5 years, maybe longer.

MB

 

By the logic of rarity and production numbers 456(M)s values should be on par with 550 values, which they are not. There were 30% less 575Ms produced than 550s which makes them even rarer yet there again 575M values have remained lower.
Also, about as many Diablos were produced as 550s yet I will never even just dream of owning one just because they are not anywhere near as easy to work on as a 550 which is IMO a much better designed and better built car. My point is that cars "easy" to wrench on will always enjoy a better reputation on the classic car scene, among DIYers but also among professional mechanics, and this will always make a difference on long term values wrt its production number, which makes the 550 a real world supercar with no silly maintenance items such as fuel tank replacement every x years, for example. This is what makes such a high end GT more desirable to me than anything else, but this is just me and I confess that decades of DIYing has probably made me more down to earth and practical than most exotic cars enthusiasts, sorry.

 

Hagerty's valuation tool should be taken with a pinch of salt. I happily paid 40% over their figure for my Bentley Continental in 2021 and sold it 2 years later for double their valuation.

Classic cars are not reliable financial investments. Even if you are into buying "investment grade" cars (very expensive and rare models) and wrapping them up in cotton wool instead of driving them, you can go wrong. They are, however, enormous fund to own and drive, and if you are lucky they can provide free motoring.

Like most "investments", timing is everything - and almost invariably a matter of luck rather than skill. I bought my 550 for £45K in 2012 and could have sold it for well over £100K a few years later, but by the time I did sell it in 2021, it cost the new owner only £85K. But I wasn't unhappy - it had repaid every single penny I had spent on it, right down to the last gallon of petrol, and I had had 8+ years of motoring in one of the all-time greats. Of course, if I had bought it in 2015/6 for £120K, I might have been less sanguine!

 

456s have too many seats and most 575s are flappy paddle automatics.