Investment Driving

"Brian Tschiegg" (WritingInCars) 01/27/2014 at 12:45 • Filed to: Lamborghini, Investment, Veneno, MOPAR, Plymouth, Muscle Car

1

14

If you were one of the three people lucky enough (read: rich enough) to obtain a Lamborghini Veneno, no one would fault you for being hesitant to drive it anywhere. After all, most people will never see $4 million in their lifetime let alone be able to spend that on a car that is ill equipped to do anything other than peel your face off with pure speed; however, I think we were all happy to hear that one of the new owners in Florida will be making the effort to show everyone in his neighborhood how much he spent.

Cars are never what you would call a sound financial investment. New cars immediately depreciate and at a certain point they'll start losing a lot of value when various bits start to fall off. The same isn't true for extremely limited run cars such as the Veneno. Even with a couple thousand miles on the dash, it's still worth enough to make a fair trade for a small island nation. The same can be said for many limited production and rare antique cars. So why do so many people refuse to drive them?

My dad purchased a 1970 Plymouth Barracuda at the height of the classic car boom. It was a Plum Purple convertible with a 340 Six Pack and a ridiculous luggage rack on the trunk lid before he started his restoration process. Almost ten years later, it is now "Tor Red" with a hockey strip vinyl streaking down the side and loudly proclaiming that a Hemi lives under the hood. Years of work, thousands of dollars, and a countless headaches were poured into the restoration of this car, and yet, he never drives it.

Despite how much he loves the car, he can't bear to bring it out into the world where it could get scratched or dinged or even possibly blown up (he likes to jump to worst case scenarios). It has become a piece of garage art that rarely gets appreciated since it lives its life under a cover. Because of his obsession with the resale value of the car, he doesn't get to enjoy the real value of the car of getting to enjoy it out on the road. Cars were never meant to be driven into a garage and just parked (besides Alfas which are beautiful but will never roll out of the garage once they roll in); they were meant to be driven and seen.

Don't get me wrong, I fully support keeping your baby inside on rainy/snowy/tornadoey days, but please share them with the rest of the world. Otherwise you're doing yourself, your car, and the whole world a disservice. Cars were never meant to be an investment, so don't treat yours like a mutual fund. Take it out of the bank and drive it around every once in a while. Your wallet won't know the difference, but the hair on the back of your neck will thank you just like it does to me whenever I hear that Cuda explode into life every couple of months.

dogisbadob > Brian Tschiegg 01/27/2014 at 12:51

0

Maybe they do hurt value more than we think.

How much do you think an F40 with 200k would fetch?

Brian Silvestro > Brian Tschiegg 01/27/2014 at 12:54

0

FP!

HammerheadFistpunch > Brian Tschiegg 01/27/2014 at 12:56

0

My wife and I watched "extreme cheapskates" last night for fun and the theme of the show, as it rolled on vignetting different cheapskates was the same:

I will be selfish with my money and squirrel it away, despite the social and opportunity costs. Money is the only "cost" they see. I suspect its the same people who think about cars as investments...to varying degrees.

Yowen - not necessarily not spaghetti and meatballs > HammerheadFistpunch 01/27/2014 at 12:59

1

Yeah, pretty much the same people that'll drive 10 miles to save 4 cents per gallon.

1) you are wasting your time

2) you very likely aren't saving any money due to the extra driving

These are likely also people that use the cheapest of the cheap stuff to repair or replace things in their house, ultimately hurting the resale value, where they could have spent $100 more on appliances to make a much better impression on potential buyers.

Brian Tschiegg > dogisbadob 01/27/2014 at 13:10

1

Hopefully no one is DD'ing their F40 (I would). I can't imagine using it on the weekends and special occasions would rack up miles like your commuter. I'll a amend my thesis by saying drive your car, just not everywhere.

dogisbadob > Brian Tschiegg 01/27/2014 at 13:13

1

Hopefully *someone is DD'ing their F40 (I would).

/fixed :)

Jay Lauer > Brian Tschiegg 01/27/2014 at 13:27

0

New cars almost always lose their values, so don't buy them. You have to buy used cars.

It's a lot like stocks really. You have to forecast what you think will rise in value in the coming months or years. If your dad had bought the Mopar two years before the boom, he would've made an investment payday.

More simple versions exist, though. Buy convertibles in the fall and sell them in the spring. Or do what I did, buy a WRX in March and sell it in October. I made money off it.

If you're mechanically savvy, buy fixer uppers of cars that have enthusiast following or cars that hold their values really well.

If anything, cars are a much safer investment, net a larger profit much quicker, and you get to drive around in a cool car. You can drive your Enron stock.

N/A POWAAAHH > Brian Tschiegg 01/27/2014 at 14:05

0

I would prefer to buy cheap cars (miatas, 240s) and drive them. They may not look pretty, but if it's fun on the back roads, they're good in my book.

philipilihp > dogisbadob 01/27/2014 at 14:06

1

I don't think the point is that you should DD your Veneno. That is neither practical nor possible. But at least take it out once in a while so that you can actually enjoy the fact that countless people poured countless hours into researching, designing, and building your 6.5L V12 and carbon fiber body. The sound of a Lamborghini V12 is too beautiful to never be heard.

alexotics > Brian Tschiegg 01/27/2014 at 14:26

1

Great post. But for the people out there who buy cars as investment opportunities (myself included), each will have his or her own strategy. It's an extremely unpredictable investment as your return will depend on what you bought, but also the density of the market in your area, the time of year, and straight up luck in terms of things going wrong during ownership and finding the right buyer.

It's tricky. And the danger of something going catastrophically wrong and eating in to your margin is higher when you drive it. Even more so when you drive it the way it was meant to be driven. So far, I've taken the latter approach and drive with crossed fingers.

dogisbadob > philipilihp 01/27/2014 at 18:00

0

Oh, man!

Because I definitely *do* support using a Veneno as a daily.

Brian Tschiegg > Jay Lauer 01/27/2014 at 18:14

0

I actually wrote about investing in cars here. I agree with everything that you've said. It makes way more sense (to me) to invest in something that you can enjoy having as well as make money. Even if cars don't perform as well as your company funded mutual fund, they will provide a greater return on investment from the time that you get to enjoy them as well as the profit.

!!! UNKNOWN CONTENT TYPE !!!

philipilihp > dogisbadob 01/27/2014 at 19:27

1

Lol don't we all?

GRawesome > Brian Tschiegg 01/29/2014 at 23:10

0

How much do you think your dad hurt the potential value of the car by changing the original color? Plum Crazy Purple is probably the most sought after color for those old Mopars. Does the car have the original engine? If not, then maybe driving it won't really affect the long term value. He does have a point about it exploding though, having done all that work I would be very upset if some dummy texting and driving rear ended me and the car caught fire.