"ttyymmnn" (ttyymmnn)
05/14/2020 at 23:32 • Filed to: None
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"ttyymmnn" (ttyymmnn)
05/14/2020 at 23:32 • Filed to: None | 0
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And I’ve got a few questions.
How can there be so many people with so damned much money to buy collector cars? Are they investors? Are these cars ever going to get driven? Are they going to some guy’s garage where he and his golf buddies will stand around and hold a beer while looking at it? Will people show them? Are most of these just long term investments for rich people?
I’m sure it’s a mix of all of that. But I look at a lot of those 6-digit cars and think, “Damn, I’d drive the shit out of that.” Because if I could afford it, I could afford the insurance.
Rusty Vandura - www.tinyurl.com/keepoppo
> ttyymmnn
05/14/2020 at 23:43 |
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Watch the remake of Poldark, instead, on Amazon Prime. Remember the series from the 70s? I have those on DVD, BTW. The new one is twenty times the series the other one was.
SilentButNotReallyDeadly...killed by G/O Media
> ttyymmnn
05/14/2020 at 23:49 |
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Bear in mind that hedge funds, superannuation & pension funds and other such syndicated entities are players in any market that has some chance of good percentage returns... especially on such potentially liquid assets. Even more so if any profits generated are potentially tax exempt.
It may not be just rich people...
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ttyymmnn
> SilentButNotReallyDeadly...killed by G/O Media
05/14/2020 at 23:50 |
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So all that translates to: Investors.
Jim Spanfeller
> ttyymmnn
05/14/2020 at 23:51 |
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This is why I always find it ridiculous when boomers lament about how young people aren’t interested in old cars... WE ARE INTERESTED!!! We do want old cars! But we’re also young and most of us don’t have much money, and you people drove the prices of these things through the stratosphere! And you barely even drive them!! Hence why things like station wagons and oddball cars have become more popular lately. We gotta find the few old cars boomers haven’t given six-figure price tags. I was lucky to find a cheap ‘66 Thunderbird, but even the prices of those are going up now. I have to imagine that sooner or later, as boomers die off, the market will become flooded with a ton of really nice desir able classics that never got driven, and then the prices will go down and maybe there will be a resurgence in interest among young people for those cars. Until then, many of them are simply out of reach.
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SilentButNotReallyDeadly...killed by G/O Media
> ttyymmnn
05/14/2020 at 23:53 |
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Pretty much.
Although it could be money laundering too. Especially for international players...
gmporschenut also a fan of hondas
> ttyymmnn
05/14/2020 at 23:54 |
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https://www.oldcarsweekly.com/news/meet-the-industry-john-kraman-of-mecum-auctions
i guess only @ 65% are sold.
I’ve wondered similar things expecially when the announcer even made a comment about someone buying multiple cars.
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ttyymmnn
> Jim Spanfeller
05/14/2020 at 23:56 |
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I know very little about cars (ask me about airplanes) , but I know what I like. And I like that my high schooler is appreciating some of the old iron too. We watched 70s hemi C hallenger sell for some stupid amount of money, and the TV commentators were going on about how the new “2nd generation muscle cars” were true to the lines of the originals. My question: Will a 2019 Challenger fetch $125k in 45 years? I’ll probably be dead by then, but I doubt it.
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ttyymmnn
> SilentButNotReallyDeadly...killed by G/O Media
05/14/2020 at 23:57 |
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But Mecum doesn’t care. They just want their cut.
wafflesnfalafel
> ttyymmnn
05/15/2020 at 00:06 |
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ha - I was watching Mecum reruns yesterday too. Florida 2019 - yellow La Ferrari didn’t make reserve at 3mil! But ended up selling behind closed doors for 3.1...
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ttyymmnn
> wafflesnfalafel
05/15/2020 at 00:10 |
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T he last one I watched sold a red La Ferrari to what looked like a guy from Indonesia for $2.4M. Right now they’re auctioning a 2017 Pagani Huayra with 129 miles. It’s going for $2.7 M or so, and it will likely never be driven. It’s stupid.
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SilentButNotReallyDeadly...killed by G/O Media
> ttyymmnn
05/15/2020 at 00:15 |
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As does any salesperson, financial adviser, betting agent , real estate agent or auction house of any kind, the world over.
And they get it too unless there is a specific legal statute that says otherwise (in the case of money laundering).
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gmporschenut also a fan of hondas
> Jim Spanfeller
05/15/2020 at 00:15 |
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Its a bit of a self fulfilling prophecy. a major hurdle is without a place to work and store wihtout going to shit. On top they also aren’t always the greatest as a daily so it isn’t your car, its your second car.
.
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ttyymmnn
> SilentButNotReallyDeadly...killed by G/O Media
05/15/2020 at 00:16 |
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I didn’t mean to imply anything shady. It’s a business, and they’ve found their niche. Can’t fault them for that.
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Jim Spanfeller
> gmporschenut also a fan of hondas
05/15/2020 at 00:32 |
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“On top they also aren’t always the greatest as a daily so it isn’t your car, its your second car.”
Well, unless you’re insane like me and daily a car from ‘66... But yeah, owning a classic is a major commitment. I wouldn’t blame anyone for wanting to get a more practical car first.
SPAMBot - Horse Doctor
> ttyymmnn
05/15/2020 at 00:34 |
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I can’t answer most of your questions, but I will say, from my limited experience, collector car insurance is very cheap. An agreed value plan on my Ferrari is $450-$1200 a year, depending on the company. I am not with the cheapest company right not, for reasons, but I’m guessing the risk profile for these types of cars is pretty low. Most come with mileage restrictions (some don't!) , but no one is putting 12k a year on their classic car anyway. I was ambitious the first year I had the 348 and elected for a 6000 mi/year plan. I promptly dropped that down to 3500, and sadly, I could probably go down another tier. I've put 6k on the car since Nov 2016. The venn diagram of days I have time to drive, times I feel like driving, days with good weather, and timing where traffic won't be bad, has very little overlap.
Gone
> ttyymmnn
05/15/2020 at 08:58 |
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Mostly collectors investors of various types. Garage art mostly. It’s a non-neutral (say like cash) allocation in a portfolio. Should go up (not always), which is why the market is inherently BS. Both the buyer and seller have a need for the car to increase value over time. One cannot short the car market (though this could be interesting)... Collector’s insurance is pretty cheap actually, but lots of rules.
Hang around the muscle car guys long enough...there’s shill bidding and guys buying their own cars back. I have no doubt there’s money laundering going on as well. Corruption will follow the money.... This is not to say that Mecum, BJ, etc are in on it. That’d be a pretty big deal... BaT has it’s own issues with that and it seems like there’s been an uptick in shills over the last few years. Lots of one time new bidders on some cars (lots of times on muscle cars no less). However, the BaT model is so discounted comparatively, that I’m not sure what an in person auction gets you. The fees are hilariously high.
$200k car:
BaT - seller fee ($99 standard, $349 prof photos, ??? white glove) + buyer fee 5% or $5k max.
Pulling a number out of my ass for a white glove ($5k just because seems exorbitant) Premium (21 day) is $200k + 5k + 5k = $210k. $5k from seller (receive $195k) and $205k from buyer. BaT takes $10k
BJ - Seller’s registration fee (?) + seller’s fee (8%) + buyer’s reg fee (?) + buyer’s fee (10% in person or 12% remote). Now the $200k car costs the buyer $16k and the seller $220-224k. $200k + $16k + 20k. BJ takes $36k. Car has to sell for $212k to be the same seller net as BaT. Car has to be bought for $186k for same buyer net.
Speed
> ttyymmnn
05/15/2020 at 09:51 |
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I wonder this sort of thing all the time while seeing these auctions, browsing social media, reading magazine/online articles or even just sitting in traffic. How are there so many people with so much disposable income. Meanwhile here I am trying to keep my old fleet on the move. I’m not holding anyone’s wealth against them, I’m just trying to figure out how I get in on it and make the quantum leap to having so much money to play with.
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ttyymmnn
> Speed
05/15/2020 at 10:11 |
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Investing. You either start out on third base as a kid and inherit the money, or you start a successful business, then you start investing your profits. Most of us start off firmly on first base, many others are still in the parking lot outside the stadium. But based on other replies, I think most of what we are seeing is investors parking money in an asset that should only increase in value. The real shame is that these fantastic cars likely won’t see the light of day after they are sold.
Y2K996Cab
> ttyymmnn
05/15/2020 at 11:00 |
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The difference between the late 60's and early 70's was that it was the end of an era. Starting around 1972 cars had to have emission equipment that choked the life out of the engines. Then the Arab Oil Embargo produced smaller cars with smaller engines. By the mid 70's the few remaining big block motors were putting out half the power of the earlier versions. My 1969 Hemi Roadrunner was rated at 425HP while my 1976 Trans Am 455SD was rated at 200HP. Also, back when they were new, not many people were getting the Hemis and 440 Six Packs as they were very expensive options (you were getting more power but also completely different transmissions, suspension, axle, brakes, wheels and tires) and you were unable to get air conditioning or power steering when you ordered them. I bought the Hemi Roadrunner in 1973 with 22,000 miles on it for $1,700. My 1970 440 Six Pack Cuda was $1,200 in 1974. And although I sold them for a nice profit I wish I still had them today.
Since they re-released the Challenger it has gone from 425HP to 707HP to 797HP to 840HP. It’s going to take an end to the horsepower wars to ever make these cars as truly valuable as the first generation muscle cars have become.
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ttyymmnn
> Y2K996Cab
05/15/2020 at 11:02 |
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Thanks for the insight. Cheers.
cmill189 - sans Volvo
> Speed
05/15/2020 at 13:20 |
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The answer is credit and paying the absolute minimum amount with the longest terms.
My state has a shockingly high number of people that can “afford” a 50-80k pickup truck to haul a 50-100k toy hauler fifth wheel with a 20k side-by-side inside. Add in 3-5 kids, a single income, a half million dollar mortgage and the math doesn’t add up. Plenty of people have large amounts of disposable income but not entire neighborhoods.
I should clarify that I’m not making this up by my random observations. My current and former job involves being in peoples business and the former involved their finances. Most of those people had less than $5,000 in liquid cash.
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Y2K996Cab
> ttyymmnn
05/15/2020 at 15:10 |
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I remember seeing one of the 11 1971 Hemi Cuda convertibles in a museum in Volo, IL in the early 80's with an asking price of $59,900. Although the car still had the pre- delivery plastic bags on the seats I thought they were out of their mind with that price. One of the only two 4 speed models sold in 2014 for $ 3.5 million dollars.
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SPAMBot - Horse Doctor
> cmill189 - sans Volvo
05/15/2020 at 23:07 |
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The liquid cash Stat is terrifying. I know all the statistics say like 80% of people live paycheck to paycheck. I have a friend, who makes considerably more than I do, but has no savings and in decently deep credit card debt. The thought of it actually makes me anxious. Everyone wants the shiny thing and they want it now. I grew up in a situation where we lived paycheck to paycheck (honestly not even p2p) but we were just poor. Coming from that, I do not know why someone would purposely put themselves in that situation. I want all that fun shit too, but it's not fun worrying your lights won't turn on, or your water is shut-off, when you return home. /off my soapbox
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cmill189 - sans Volvo
> SPAMBot - Horse Doctor
05/16/2020 at 00:11 |
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100% agree and I came from the same type of situation. Without my grandparents saving my parents ass several times we would have been homeless.