Results 1 to 12 of 12

Thread: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

  1. #1
    Join Date
    Nov 2006
    Location
    NorCAL
    Posts
    20,090

    Default The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    https://www.nytimes.com/2022/06/30/a...reciation.html *edited to avoid the paywall

    Because of depreciation, buyers could once get high-end cars at a fraction of their original cost. No longer.



    The 1988 Porsche 911 Turbo has held its value remarkably well, with not a single turbo vintage depreciating in value, and some surging in price.Credit...National Motor Museum/Heritage Images/Getty Images

    By Rob Sass

    Published June 30, 2022 - Updated July 1, 2022
    ]Henry N. Manney III, an automotive journalist best known for his extensive writing in Road & Track magazine, bought a Ferrari 250 GTO in the late 1960s. One of just 36 ever built, the car was Ferrari’s $18,000 top-of-the-line sports/racing car in 1962. When the cars first rolled off the line, Enzo Ferrari, the company founder, had to personally approve every buyer.
    ]But less than a decade later, when Mr. Manney bought his GTO, he paid less than a third of its original cost. Today, the car might be worth over $60 million, with a 1963 model selling for $70 million in 2018.
    With that purchase, Mr. Manney, who died in 1988, became somewhat of a legend, a folk hero and role model for people of ordinary means who were able to buy and enjoy truly special cars through the miracle of depreciation. It’s a pastime in which rank-and-file car enthusiasts might no longer be able to participate today.

    For the time being, depreciation cycles for high-end sports cars are clearly doing something unusual. In the past, these cars would shed a large percentage of their values soon after sale. From there, it was a long slog to the bottom of the depreciation curve, where cars would often languish for years, sometimes decades, before nostalgia-driven interest drove values up again. Collectors would tend to take notice only when a car’s value had regained its original price.

    Enthusiasts could once buy aspirational cars for pennies on the dollar; today, models like the Ferrari 360 Modena are following a much shallower depreciation curve than their predecessors. Credit...National Motor Museum/Heritage Images/Getty Images




    But recently, depreciation curves seem to have gotten far more shallow, and appreciation appears to be happening much sooner than it did in the past. That may spell an end for today’s middle-class who dream of buying aspirational cars for pennies on the dollar.
    “Sometime around the mid-2010s, the paradigm shifted around high-end sports cars,” said John Wiley, manager of valuation analytics for Hagerty, the classic-car insurer. “Whereas cars like the 2005 Ford GT, 2005 Porsche Carrera GT and 2003 BMW Z8 had all experienced some modest depreciation after five years, the next generation of high-end, limited-production sports cars like the McLaren P1, the new Ford GT and Porsche 918 Spyder had all appreciated after five years.”


    Art Mason, a commercial airline pilot who lives in Pennsylvania, had his own dreams of Ferrari ownership. While his dreams were not as lofty as Mr. Manney’s, he nonetheless bought a 1982 Ferrari 308 GTSi, complete with a warranty, for $35,500 in 2008.

    “That price was a bit more than half of what the car cost new, and 308s had been available in that price range for close to 20 years,” he said. “For a kid from West Philly who spent his youth pushing his nose against showroom windows, the notion of owning any Ferrari was a big deal.” Mr. Mason sold the Ferrari about 10 years ago for $36,000, but today, that 308 might be pushing $100,000, or a third more than its original list price. The idea of owning any Ferrari at half the new price or less is fading quickly. An early 2000s 360 Modena with a manual transmission is already about $25,000 more expensive than its original price, of about $150,000. That Ferrari’s depreciation trajectory has been nothing like that of its ancestor, the 308.
    “So many people are willing to pay significantly more for cars than collectors had been in the past,” Mr. Mason said. “As much as I loved being a Ferrari owner, it just doesn’t hold that much appeal for me at the prices that the cars are bringing now. A lot of these cars are just being shoved into big collections and being hidden away. It seems like proof that enthusiasts like me aren’t buying these cars anymore.” Neil Gellman, a St. Louis-based real estate agent, had wanted a Porsche 911 Turbo for most of his life.]About eight years ago, he realized that 911 Turbos from the early 2000s had become conspicuously, and almost unbelievably, cheap. He bought a 2001 model with 39,000 miles on it for $36,000.[/COLOR]

    “The car cost well over $100,000 new,” Mr. Gellman said. “I couldn’t believe that for under $40,000, I could buy a barely-used 911 Turbo, for what was essentially the price of a new Camry. Today, that car’s value is already approaching its original sale price. In hindsight, Mr. Gellman realizes that he bought his car at the bottom of the depreciation curve. “I never expected the car to go up in value that much, that quickly. I might have held on to it,” he said. Typically, Mr. Wiley of Hagerty noted, cars like used Porsche 911 Turbos would hit bottom and then stay there for a while. “Up until around 2011, a 911 Turbo from the 1980s could still be bought for less than half of its original price,” he said.
    Now, new 911 Turbos are selling for over their original price, and not a single existing model seems to be depreciating. Some 911s of certain vintages, are, in fact, appreciating quite rapidly, particularly those with manual transmissions, Mr. Wiley said. ]“It’s difficult to come up with a precise explanation,” he said. “The cars have certainly gotten more expensive, and people may be using and valuing them differently, putting fewer miles on them, and perhaps there is also the realization that we are nearing the end of the pure internal combustion era of the automobile, and that these cars will be regarded as quite special in the future.”

    The earliest vintage models of the Gallardo, Lamborghini’s best-selling car, now fetch prices over $100,000. Credit...J. Emilio Flores/Getty Images




    Lamborghinis are also rising in value. The Gallardo was the company’s best-selling car, with over 14,000 sold from 2008 to 2018. It was a huge number for a boutique manufacturer, which had crafted approximately 30,000 cars in total before the Gallardo came out. Around 2019, the earliest vintage Gallardos had hit bottom in the $80,000 range, about half their original cost. Today, those cars are priced over $100,000, with rare manual transmission Gallardos selling for over $200,000. There is also the current supply-and-demand based reality.

    Many of the new sports cars that are produced in smaller numbers are actually starting out at prices significantly higher than the actual selling price. Recently, Mr. Mason, the Pennsylvania-based pilot and former Ferrari owner, bought a new Porsche 718 Spyder. “I might have been the last ordinary person to buy one at the list price, and I never would have paid a premium, but from what I understand, people are paying upward of $30,000 over M.S.R.P. to get one. While a buyer under those circumstances might not recoup that additional dealer markup down the road, I don’t expect my car to depreciate much, ever.”
    Without friends none of this is possible.

  2. #2
    Join Date
    Sep 2009
    Location
    Saint Helena Island, SC
    Posts
    12,470

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    Really sorry I sold my ‘97 Carrera S @ 10 years ago. Made some $$ on it, but now it’d bring @ $150k. Crazy.
    Fight Entropy, build a wooden boat!

  3. #3
    Join Date
    Apr 2020
    Location
    Seattle Washington USA
    Posts
    394

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    In my teens (mid-late 1960s) I was in a swoon over Ferraris, particularly the 275 GTB-4. R&T tested one, and I recall the price being around $16,000.
    At age 18, with money from my part time job in a hardware store, I bought a 9 year old Porsche 356B for around $1200, in good condition.
    Last edited by Jack Loudon; 07-03-2022 at 12:07 PM.

  4. #4
    Join Date
    May 2015
    Location
    The Garden State
    Posts
    9,807

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    back in the very early 90s I had a 1972 Porsche 911e. I bought it cheaply, drove it for almost a year, and broke a rocker shaft. I could have fixed it, but I got an offer for more than I paid for it, so off it went.

    I wish I had never sold that car. It was even in that cool 70s signal orange colour.
    "If you think you are too small to make a difference, try sleeping with a mosquito"

    -Dalai Lama

  5. #5
    Join Date
    Jul 2013
    Location
    Aquitaine
    Posts
    2,205

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    Our chairman bought the '62 250 GTO that he raced for £6000, after it was 'last years car' and a bit slow.He kept it untill the late 90's? so quite good appreciation.
    I was offered a 911S for £500 in the 70s. But balked when I found out the cost of the new exhaust system it needed.
    Life is full of missed opportunities....
    Cuz bought a Daytona in Italy and sold it a bit later for decent money, but then he also bought two of the original GT40s, when they were current. Several other desirable exotics too . Slight different world to mine

  6. #6
    Join Date
    Jan 2002
    Location
    victoria, australia. (1 address now)
    Posts
    70,267

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    Investment in many other fields is no longer secure.

  7. #7
    Join Date
    Jul 2008
    Location
    Tacoma, WA
    Posts
    20,389

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    Dammitall. I went looking for the Enzo Ferrari quote about the jeep being the only American sports car; only to discover that he never said such a thing.
    ITS CHAOS, BE KIND

  8. #8
    Join Date
    Jan 2002
    Location
    victoria, australia. (1 address now)
    Posts
    70,267

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    And did Ettore really call the Bentley cars 'trucks'?

  9. #9
    Join Date
    Jul 2013
    Location
    Aquitaine
    Posts
    2,205

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    Quote Originally Posted by skuthorp View Post
    And did Ettore really call the Bentley cars 'trucks'?
    Fastest trucks?

  10. #10
    Join Date
    Mar 2009
    Location
    Billings, Montana
    Posts
    1,058

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    I bought a 1984 BMW 633 10 years ago for $5,000. It included the original window sticker that listed it for $41,000. We didn't pay much more for our first house.

    Gary

  11. #11
    Join Date
    Sep 2009
    Location
    Saint Helena Island, SC
    Posts
    12,470

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    Quote Originally Posted by Gary Davis View Post
    I bought a 1984 BMW 633 10 years ago for $5,000. It included the original window sticker that listed it for $41,000. We didn't pay much more for our first house.

    Gary
    In good shape it’d bring a lot more than $5k now.
    Fight Entropy, build a wooden boat!

  12. #12
    Join Date
    Dec 2009
    Location
    Frankfort, MI
    Posts
    10,735

    Default Re: The Era of Buying Top Sports Cars Cheaply Seems to Be Over

    I owned a 356 for $3000 that was pretty rusty when I bought it. It was a good, reliable car, but the rust finally did it in. Then my friend and I went together and bought three Porsches a guy had, two 912’s and a 911 Targa. We sold the 911 pretty quickly because neither of us could afford the insurance to drive it, and we each kept and drove a 912.

    The 356 I had owned previously was a much better car in every way—the 912 suspension was better on a spec sheet, but in the real world the 356 was more satisfying to drive. As the front trunk floor rusted away the 912 steering assembly actually rotated about 15 degrees and developed a bind, and I shimmed it back into proper position with some patches cut from a coffee can.

    The only good thing about the 912 was I sold it for more than I paid for it.

    Jeff C
    Don’t expect much, and you won’t be disappointed…

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •