JD Classics, what have they been up to?
Discussion
This illustrates the fact that a large (huge) part of the escalation in values of classic cars is driven by those with a vested interest. Just like any other financial investment, there is no intrinsic value. Value is determined by 'experts', and those experts are never going to promote a bear market.
Again, just like any other financial investment, throwing money at classic cars requires some objective market research. If the man who is talking up the market is also the man who is taking your money, then you really need some independent advice.
Again, just like any other financial investment, throwing money at classic cars requires some objective market research. If the man who is talking up the market is also the man who is taking your money, then you really need some independent advice.
Indeed. Very much a case of 'let's see how much I can get away with' in the upper reaches.
Seventeen grand (!) for a Farina MG Magnette, a car that was a joke even when new. I don't care that it's only done 15'000 miles, it's f
king junk. That's not nostalgia but stupidity fed by greedy dealers.
I have a sort of vested interest in the values of old Escorts but even I just laugh at the madness of it all. All the way to the bank? We'll see, but I paid buttons so I don't care.
Seventeen grand (!) for a Farina MG Magnette, a car that was a joke even when new. I don't care that it's only done 15'000 miles, it's f
king junk. That's not nostalgia but stupidity fed by greedy dealers.I have a sort of vested interest in the values of old Escorts but even I just laugh at the madness of it all. All the way to the bank? We'll see, but I paid buttons so I don't care.
iSore said:
Indeed. Very much a case of 'let's see how much I can get away with' in the upper reaches.
Seventeen grand (!) for a Farina MG Magnette, a car that was a joke even when new. I don't care that it's only done 15'000 miles, it's fking junk. That's not nostalgia but stupidity fed by greedy dealers.
I have a sort of vested interest in the values of old Escorts but even I just laugh at the madness of it all. All the way to the bank? We'll see, but I paid buttons so I don't care.
Hear Hear!Seventeen grand (!) for a Farina MG Magnette, a car that was a joke even when new. I don't care that it's only done 15'000 miles, it's f
king junk. That's not nostalgia but stupidity fed by greedy dealers.I have a sort of vested interest in the values of old Escorts but even I just laugh at the madness of it all. All the way to the bank? We'll see, but I paid buttons so I don't care.
Strela said:
A couple of general observations.
It took over twenty years for classic cars to regain the values they reached in the late 80s boom, and very few have surpassed those values when adjusted for inflation. That's a bleeding awful record, and lowdrag's examples of fluctuating values in that period are very instructive. Remember the MK.II Jag frenzy back in the 80s? And 512BBis are not being advertised for much more now than they were back then. The market for these things remains tiny, but is definitely less speculative because more people are more wealthy and aren't just in it for a quick buck.
The six figure Ford Escort commands disproportionate attention, and lends undue excitement to the fact that the majority of examples have increased in value from effectively zero to low five figures then plateaud. You've got to be pretty skint to consider that a goldmine. And the fact that it's an Escort simply reflects changing tastes. Some people were probably shifting a few Phantom VIs back in the late 80s for over £200k. There are far fewer buyers for that kind of thing now and most sellers would rip your arm off for any kind of deal.
I don't go along with the black swan idea. Classic cars have been a long undervalued asset, are a discretionary and highly risky purchase, and remain at peanuts values compared to watches, fine art and property. They have mostly only ever been an expensive hobby, and unless you've only bought for short term gain and been exceptionally lucky in the last few years, it's inconceivable that you'd ever turned a profit worth talking about. You're exceptionally lucky if you cover the costs of even short term ownership.
Just my tuppence worth.
I recall the feeding frenzy of the late 1980s and, at the time, was dismayed to see once affordable classics disappear out of reach. I was in my late teens and a Mini enthusiast. I had to make do with a 1275GT because the Cooper S's were so bloody expensive.It took over twenty years for classic cars to regain the values they reached in the late 80s boom, and very few have surpassed those values when adjusted for inflation. That's a bleeding awful record, and lowdrag's examples of fluctuating values in that period are very instructive. Remember the MK.II Jag frenzy back in the 80s? And 512BBis are not being advertised for much more now than they were back then. The market for these things remains tiny, but is definitely less speculative because more people are more wealthy and aren't just in it for a quick buck.
The six figure Ford Escort commands disproportionate attention, and lends undue excitement to the fact that the majority of examples have increased in value from effectively zero to low five figures then plateaud. You've got to be pretty skint to consider that a goldmine. And the fact that it's an Escort simply reflects changing tastes. Some people were probably shifting a few Phantom VIs back in the late 80s for over £200k. There are far fewer buyers for that kind of thing now and most sellers would rip your arm off for any kind of deal.
I don't go along with the black swan idea. Classic cars have been a long undervalued asset, are a discretionary and highly risky purchase, and remain at peanuts values compared to watches, fine art and property. They have mostly only ever been an expensive hobby, and unless you've only bought for short term gain and been exceptionally lucky in the last few years, it's inconceivable that you'd ever turned a profit worth talking about. You're exceptionally lucky if you cover the costs of even short term ownership.
Just my tuppence worth.
I was pleased when the market crashed and took so long to recover, as it allowed me to buy all sorts of daft things.
In 2005 I paid £37k for a 1500 mile Ferrari 328, had a fantastic couple of years with it and sold it on. Adjusted for inflation, that's the equivalent of £54k today.
What price that same car now? £125,000? More?
Either way, it is considerably less accessible than it was. And I regard that as a shame, because there is a whole generation of enthusiasts who can't afford the admission price and are denied the opportunity that I had.
From a purely selfish point of view, it was pleasant watching my old Esprit appreciate from the £15k that I paid to the £30k that it was eventually sold for. But then again, what price the cost of replacing it with an Elan?
I know a chap who has been hoovering up old Nortons, BSAs and Triumphs. He has filled a shipping container with them. It's his pension.
They don't get ridden. They don't get maintained or restored. They provide no benefit to the bike restoration industry. He derives no enjoyment from them and I am denied the vicarious pleasure of seeing them being used. Frankly, I think it stinks.
Do I want to see people get their fingers burned? No, of course not. But it would be nice to see the speculators and investors bugger off and leave old cars and bikes to proper enthusiasts.
And if that means that they are undervalued compared to watches, fine art or property, then so much the better.
I so agree, these things are worth the money or they are not, and that is the judgement you have to make. I bought a DB5 way back in the day for £5000 and it was great fun and I thought that I was James Bond, but expensive and with loads of little problems creeping up, and I sold it on for much the same before it had the chance to bankrupt me. The car was obviously worth more than that even then, but £750k now? I don't think so, and I think that a number of specific dealers started that off by asking outrageous sums of money for them, and it caught on with the speculators. It has at least resulted in superb restorations being carried out. I also had a TR4A IRS, which cost me £900, again clearly a bargain. I had it for four years then sold it for £1000. I'm sorry that I didn't hold on to it, not because of the appreciation, but because I could have had much more fun out of it. But £25k now for a good example? And 40k plus for a TR5? Again, nuts in my view, as you are much better, faster more economical and safer with a new top end MX5, or even an entry level F Type.
Classic cars took off in the 1970's because they offered a way into the ownership of exciting cars for those who couldn't afford to buy them new. And what you could buy in those days for relatively small sums even allowing for inflation is gobsmacking - look at an old copy of Motor Sport. At the time I bought my TR4A for £900, a DB3S could have been bought, no doubt a bit tatty for £8000, and a DB5 Convertible for £1,695. They were obviously undervalued then, but things have totally changed.
These old cars are very attractive, but in my view the entirely real market for true collectors cars is smaller than is generally believed. Old cars have a nostalgia value, and people get carried away with the idea of buying a slice of history. There is also an increasing interest in acquiring classics among the manufacturers themselves, and among rising wealthy classes in India, China and Russia. A lot of the cars bought for significant sums are however in my view at least, of no great historical, artistic, cultural or automotive merit at all, and as far as the others are concerned I am happy to leave the collecting, particularly at high values, to the fabulous motor museums at Munich, Sinsheim and Speyer, which I can visit when I feel like it. However collectors are collectors, and they may choose to collect what they like. The speculators feed off them, but if it were me at this point I would be very cautious. You can't use a classic worth £20 million in the way the car would have been used when it was new, so ultimately, apart from curiosity value, what is the point in having it? It also needs to be kept in an expensive, secure and air conditioned environment, as well as serviced frequently by expensive experts.
I applaud people like Jay Leno who can collect, maintain and run some fabulous cars, but he is the exception, not the norm. For the enthusiast, who can't afford or does not want to get into collecting cars at the price of Impressionist paintings (and that is another very comparable story) new car availability and pricing is the yardstick to judge a purchase. If you can buy a new car or a remanufactured classic (like the XJS's from KWE) which gives you what you are looking for, why buy an old car with all sorts of potential issues and dubious authenticity.
Right now, you can buy low mileage Bentleys, Aston Martins, Porsches or BMW M-cars which would run rings round most of the classics. Why buy a Bentley Continental R, which is a museum piece, for £1m, when you can buy a new Mulsanne, or Black Badge Ghost, which are better cars in every measurable way, for £250-350k? On the other hand you can buy an extremely decent RR Silver Shadow for £15k, and again, it is a better car than the R-Type, for a fraction of the price. But as for buying Morris Marinas, or some of the stuff Quentin Willson is recommending, because you think they are going to increase in value, is just bonkers.
Classic cars took off in the 1970's because they offered a way into the ownership of exciting cars for those who couldn't afford to buy them new. And what you could buy in those days for relatively small sums even allowing for inflation is gobsmacking - look at an old copy of Motor Sport. At the time I bought my TR4A for £900, a DB3S could have been bought, no doubt a bit tatty for £8000, and a DB5 Convertible for £1,695. They were obviously undervalued then, but things have totally changed.
These old cars are very attractive, but in my view the entirely real market for true collectors cars is smaller than is generally believed. Old cars have a nostalgia value, and people get carried away with the idea of buying a slice of history. There is also an increasing interest in acquiring classics among the manufacturers themselves, and among rising wealthy classes in India, China and Russia. A lot of the cars bought for significant sums are however in my view at least, of no great historical, artistic, cultural or automotive merit at all, and as far as the others are concerned I am happy to leave the collecting, particularly at high values, to the fabulous motor museums at Munich, Sinsheim and Speyer, which I can visit when I feel like it. However collectors are collectors, and they may choose to collect what they like. The speculators feed off them, but if it were me at this point I would be very cautious. You can't use a classic worth £20 million in the way the car would have been used when it was new, so ultimately, apart from curiosity value, what is the point in having it? It also needs to be kept in an expensive, secure and air conditioned environment, as well as serviced frequently by expensive experts.
I applaud people like Jay Leno who can collect, maintain and run some fabulous cars, but he is the exception, not the norm. For the enthusiast, who can't afford or does not want to get into collecting cars at the price of Impressionist paintings (and that is another very comparable story) new car availability and pricing is the yardstick to judge a purchase. If you can buy a new car or a remanufactured classic (like the XJS's from KWE) which gives you what you are looking for, why buy an old car with all sorts of potential issues and dubious authenticity.
Right now, you can buy low mileage Bentleys, Aston Martins, Porsches or BMW M-cars which would run rings round most of the classics. Why buy a Bentley Continental R, which is a museum piece, for £1m, when you can buy a new Mulsanne, or Black Badge Ghost, which are better cars in every measurable way, for £250-350k? On the other hand you can buy an extremely decent RR Silver Shadow for £15k, and again, it is a better car than the R-Type, for a fraction of the price. But as for buying Morris Marinas, or some of the stuff Quentin Willson is recommending, because you think they are going to increase in value, is just bonkers.
Edited by cardigankid on Sunday 1st April 00:19
cardigankid said:
you are much better, faster more economical and safer with a new top end MX5, or even an entry level F Type.
cardigankid said:
Right now, you can buy low mileage Bentleys, Aston Martins, Porsches or BMW M-cars which would run rings round most of the classics. Why buy a Bentley Continental R, which is a museum piece, for £1m, when you can buy a new Mulsanne, or Black Badge Ghost, which are better cars in every measurable way
I fully agree with you regarding inflated values, but these comments are those of somebody who doesn't understand classic cars.I have lost count of the number of times I've ben asked things like "Why don't you buy a new BMW instead?", and it saddens me.
I hope that I do understand classics - I have owned a few and currently have a Bentley T2, Jaguar XK8 4.2 and Mercedes CL500, all of which I regard as classics and the value of which is largely irrelevant. But I do think that you have to rationalise things in an area where too much is governed by emotion.
I think that there is an enthusiast's market, and a collector's market, and the two are not the same, unless you are Jay Leno. An enthusiast may spend uncounted hours working on his classic and never count the theoretical cost. An enthusiast may be prepared to spend large sums which he will never see again to get his car into the condition he wants, and there are plenty of marque specialists out there ready to relieve him of his cash. But few enthusiasts can or should spend hundreds of thousands of pounds buying their dream. Once you get into the realm of enormous sums of money, you are in the collectors market, and all collectors markets are riddled with dishonesty by the mere fact that there is so much money around. Are you saying that only an enthusiast should be able to buy a DB6, or an XK150S, or whatever? That is like saying that only a person who appreciates art should buy a Picasso or a Monet or a Caravaggio. The art market is long past the point where works of art art bought for artistic merit. It is a money spinning racket where prestige is for sale. In that situation, unless a buyer can prove something very different, you have a buyer and a seller, and the seller is a second hand car dealer. Whatever is said, anything that is not warranted in black and white is simple salesmanship, and means nothing. If a buyer is prepared to spend that amount of money he must take responsibility for his own actions, or employ an independent expert. To expect the dealer he is buying from to act as his expert is so naive as to be incredible. And even with an expert, no one can guarantee the future value of an old car.
Think where the 'Classic Car' furore started. it was in the late 60's, with Motor Sport, and the new 'Classic Car' magazine, which caught the zeitgeist. Up to that point, only vintage cars, meaning pre-1931, with very few exceptions, had any collectors value, and everything more modern was sneered at. Only a 'WO' Bentley was a Bentley, the later ones were all fakes.
I think that we are in a similar situation now. There is no point in the 'enthusiast' bemoaning the fact that he can't buy a vintage Bentley, or a James Bond Aston or whatever. We are living right now in an automotive golden age, maybe the end of the last such age, before personal transport becomes history and we all summon Uber bubble cars on our IPhones. There are loads of things that he can buy, and if he is an enthusiast he should recognise that. What about Porsche 997 GTS, indeed any 997 Carrera S with a Power Kit engine, or Aston Martin V8 Vantage, or any of a range of BMW M-Cars. Even a last model BMW 535d M-Sport is a damn good and extremely fast car. Bentley Mulsannes are getting cheap. There will be any number of second hand F Types available shortly. Will these rocket in value? Who knows, who cares? Only the best I would say, but if the internal combustion era is truly coming to an end, anything is possible. Teslas don't do much for me.
The only downside to it is that modern manufacturing turns out cars as consumer disposables built ever more accurately to a price, and you have to get a good one before it is totally clapped out or rusted through, then look after it. If a car has lain out in the external environment for much of its life, you will never stop it corroding without taking it completely to bits and starting again. So relatively few of the current crop are maybe keepers, but an enthusiast should be able to find them.
I think that the real problem with this guy Tuke is that he has bought in at the peak of the market, and is realising that he might not get all his money back, and imho at least that is his problem and no-one elses.
I think that there is an enthusiast's market, and a collector's market, and the two are not the same, unless you are Jay Leno. An enthusiast may spend uncounted hours working on his classic and never count the theoretical cost. An enthusiast may be prepared to spend large sums which he will never see again to get his car into the condition he wants, and there are plenty of marque specialists out there ready to relieve him of his cash. But few enthusiasts can or should spend hundreds of thousands of pounds buying their dream. Once you get into the realm of enormous sums of money, you are in the collectors market, and all collectors markets are riddled with dishonesty by the mere fact that there is so much money around. Are you saying that only an enthusiast should be able to buy a DB6, or an XK150S, or whatever? That is like saying that only a person who appreciates art should buy a Picasso or a Monet or a Caravaggio. The art market is long past the point where works of art art bought for artistic merit. It is a money spinning racket where prestige is for sale. In that situation, unless a buyer can prove something very different, you have a buyer and a seller, and the seller is a second hand car dealer. Whatever is said, anything that is not warranted in black and white is simple salesmanship, and means nothing. If a buyer is prepared to spend that amount of money he must take responsibility for his own actions, or employ an independent expert. To expect the dealer he is buying from to act as his expert is so naive as to be incredible. And even with an expert, no one can guarantee the future value of an old car.
Think where the 'Classic Car' furore started. it was in the late 60's, with Motor Sport, and the new 'Classic Car' magazine, which caught the zeitgeist. Up to that point, only vintage cars, meaning pre-1931, with very few exceptions, had any collectors value, and everything more modern was sneered at. Only a 'WO' Bentley was a Bentley, the later ones were all fakes.
I think that we are in a similar situation now. There is no point in the 'enthusiast' bemoaning the fact that he can't buy a vintage Bentley, or a James Bond Aston or whatever. We are living right now in an automotive golden age, maybe the end of the last such age, before personal transport becomes history and we all summon Uber bubble cars on our IPhones. There are loads of things that he can buy, and if he is an enthusiast he should recognise that. What about Porsche 997 GTS, indeed any 997 Carrera S with a Power Kit engine, or Aston Martin V8 Vantage, or any of a range of BMW M-Cars. Even a last model BMW 535d M-Sport is a damn good and extremely fast car. Bentley Mulsannes are getting cheap. There will be any number of second hand F Types available shortly. Will these rocket in value? Who knows, who cares? Only the best I would say, but if the internal combustion era is truly coming to an end, anything is possible. Teslas don't do much for me.
The only downside to it is that modern manufacturing turns out cars as consumer disposables built ever more accurately to a price, and you have to get a good one before it is totally clapped out or rusted through, then look after it. If a car has lain out in the external environment for much of its life, you will never stop it corroding without taking it completely to bits and starting again. So relatively few of the current crop are maybe keepers, but an enthusiast should be able to find them.
I think that the real problem with this guy Tuke is that he has bought in at the peak of the market, and is realising that he might not get all his money back, and imho at least that is his problem and no-one elses.
Edited by cardigankid on Sunday 1st April 17:46
Doofus said:
cardigankid said:
you are much better, faster more economical and safer with a new top end MX5, or even an entry level F Type.
cardigankid said:
Right now, you can buy low mileage Bentleys, Aston Martins, Porsches or BMW M-cars which would run rings round most of the classics. Why buy a Bentley Continental R, which is a museum piece, for £1m, when you can buy a new Mulsanne, or Black Badge Ghost, which are better cars in every measurable way
I fully agree with you regarding inflated values, but these comments are those of somebody who doesn't understand classic cars.I have lost count of the number of times I've ben asked things like "Why don't you buy a new BMW instead?", and it saddens me.
Drive an old classic and every journey becomes a potential adventure. You'll never be 100% sure whether you will actually get to your destination. Even if you do there is a real risk that if you get caught up in some of today typical traffic conditions the car may overheat (and you'll surely overheat without a/c) - you'll probably have an aching leg from the effort of the clutch - aching arms from the effort of not having powered steering and your hernia will be playing up from the effort of operating non-powered brakes (not forgetting the back ache from the poor ergonomics of the seating) You'll probably love and hate your classic 50/50 in equal measure. You'll 'love it' as it will most likely take skill to drive, you'll meet new people and make others smile. Yet you also hate it in equal measure as its a pig to drive. Lets ask the owner of a multi £ supercar the same question - do you love your car (for the performance and pleasure of driving such an easy car to drive) or do you hate the car for the same reason (and the fact that it cost you £XXXX's to buy?)
Edited by roscobbc on Sunday 1st April 19:29
cardigankid said:
I hope that I do understand classics...
The fact that you've owned a few doesn't mean it's in your blood and when you pose questions like this;cardigankid said:
Right now, you can buy low mileage Bentleys, Aston Martins, Porsches or BMW M-cars which would run rings round most of the classics. Why buy a Bentley Continental R, which is a museum piece, for £1m, when you can buy a new Mulsanne, or Black Badge Ghost, which are better cars in every measurable way
It suggests to me you don’t. I have a 1958 Aston, which by your measure I should sell and buy a DB11 and pocket the difference but that completely misses the point of owning and driving a classic. I know what you are trying to say, Cardigan. I said something similar about the other end of the market a few months ago. And got a similar response.
I have owned classics for my entire driving life and put up with all the downsides, even when it was difficult to do so (because I was a student, for example, or doing lots of commuting). I would say that they are "in my blood". I also think that some are not worth what are being asked for them. To me that includes lots of very ordinary cars that were never particularly good in the first place.
I guess an interesting test, particularly for the top end, would be how many people would keep hold of them if they were holding steady in terms of value (but expensive to look after) or even gently depreciating. How many owners of £1m cars would keep them if they were loosing, say, 5% per year?
I have owned classics for my entire driving life and put up with all the downsides, even when it was difficult to do so (because I was a student, for example, or doing lots of commuting). I would say that they are "in my blood". I also think that some are not worth what are being asked for them. To me that includes lots of very ordinary cars that were never particularly good in the first place.
I guess an interesting test, particularly for the top end, would be how many people would keep hold of them if they were holding steady in terms of value (but expensive to look after) or even gently depreciating. How many owners of £1m cars would keep them if they were loosing, say, 5% per year?
I have always believed that the measure of a classic car enthusiast is that he will be prepared to put more money into a car than it will ever be worth. At the rarified end of the market, investment has always been the driver (no pun intended), but for the Great Unwashed, classic cars have never made financial sense.
What we are seeing now is the same thing we saw in the early 90s. People with plenty of money and little or no interest in old cars buying into a rising market. What keeps the market rising? Dealers. Dealers able to ask faintly (or blatantly) ridiculous money for cars because "That's what it's worth.". They continue to do this for as long as the money keeps coming, and because the 'investors' don't want to get left behind, they start to put money into whatever is available. Hence we see things like OI Aston Martins rising because DB5s are out of reach. Realistically, if you want a DB5, because your uncle had one when you were a kid, or somesuch, an OI isn't going to be a suitable substitute.
I'm not criticising either car, or the enthusiast owners of them; I'm just highlighting how prices are talked up in order to relieve the naive of their money. As long as they keep coming, the market keeps rising, those 'investors' make a decent return, and the intrinsic value of the cars is long forgotten.
Until the next time the bubble bursts.
What we are seeing now is the same thing we saw in the early 90s. People with plenty of money and little or no interest in old cars buying into a rising market. What keeps the market rising? Dealers. Dealers able to ask faintly (or blatantly) ridiculous money for cars because "That's what it's worth.". They continue to do this for as long as the money keeps coming, and because the 'investors' don't want to get left behind, they start to put money into whatever is available. Hence we see things like OI Aston Martins rising because DB5s are out of reach. Realistically, if you want a DB5, because your uncle had one when you were a kid, or somesuch, an OI isn't going to be a suitable substitute.
I'm not criticising either car, or the enthusiast owners of them; I'm just highlighting how prices are talked up in order to relieve the naive of their money. As long as they keep coming, the market keeps rising, those 'investors' make a decent return, and the intrinsic value of the cars is long forgotten.
Until the next time the bubble bursts.
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