The economics of classic car investing?

DanG · Post by **DanG** » Fri Apr 27, 2012 8:05 pm

We have kicked around the idea of a fund or ETF made from a collection of cars for investment and a 'classic hire' side to generate revenue / dividend in the short term.

I believe, however, there is an ETF about to go live...

Jasper · Post by **Jasper** » Fri Apr 27, 2012 8:25 pm

I know this is slightly off the point but here goes :-

Sometime ago an idea was floated of having trackday Porsches and the likes at a F1 track in southern Europe for hire, storage etc, fly out in winter 1 to 2 track sessions and fly home, rent or your use your own car which is kept in storage , ready and running for you ? Is it a business runner ?

scalino65 · Post by **scalino65** » Fri Apr 27, 2012 8:28 pm

DanG wrote:We have kicked around the idea of a fund or ETF made from a collection of cars for investment and a 'classic hire' side to generate revenue / dividend in the short term.

I believe, however, there is an ETF about to go live...

Interesting! Isa-able collective investment. Will keep an eye out. By the way, is the car in your avatar the 912 with 3litre power recently for sale. Looked like a very nice car.
Cheers
Will

scalino65 · Post by **scalino65** » Fri Apr 27, 2012 8:30 pm

[quote="Jasper"]I know this is slightly off the point but here goes :-

Sometime ago an idea was floated of having trackday Porsches and the likes at a F1 track in southern Europe for hire, storage etc, fly out in winter 1 to 2 track sessions and fly home, rent or your use your own car which is kept in storage , ready and running for you ? Is it a business runner ?[/quote
]
Could well work. Isnt there something called ascari that does simlar? I remember a few years back there was a large house for sale in France with a race track attached. It wasn't silly money either if I remember correctly.....we could have all chipped in!

Jasper · Post by **Jasper** » Fri Apr 27, 2012 8:32 pm

DanG wrote:We have kicked around the idea of a fund or ETF made from a collection of cars for investment and a 'classic hire' side to generate revenue / dividend in the short term.

I believe, however, there is an ETF about to go live...

I heard about this, the idea was floated about 3 yrs ago, If I remember the angle is a car is a depreciating asset and there are right off opportunities etc, I saw an article in the FT in regard to
a Bugatti Aero using this angle.

DanG · Post by **DanG** » Fri Apr 27, 2012 8:36 pm

Will, yes should be ISAable, but then again I'd still prefer to be out driving my ISA subscription

Yep, that was my old 912E. Super car, learnt a lot from that project. Was VERY tempted to buy it back and finish it off properly.

scalino65 · Post by **scalino65** » Fri Apr 27, 2012 9:01 pm

DanG wrote:Will, yes should be ISAable, but then again I'd still prefer to be out driving my ISA subscription

Yep, that was my old 912E. Super car, learnt a lot from that project. Was VERY tempted to buy it back and finish it off properly.

Dan
That's another interesting point you'Ve raised: how often do you actually drive your 'investment'? I don't drive to work so it's only pleasure. With kids,etc it's increasingly difficult to find time. At best I drive mine twice a month...maybe some sort of fund with 'visiting rights' might actually work better for me....then again, would I feel the same if i'm sharing 'my' car? I've thought about this in relation to track days, I love to take my car on circuit but in actual fact maybe it would be better and cheaper to rent an Elise for the day, trash it, then walk away.

DanG · Post by **DanG** » Fri Apr 27, 2012 9:21 pm

You see that's where the ETF structure with half invested in 'museum' type investment cars and half invested in 'drivable' classics (like MGs, Porsches,TRs etc) for people to drive works so well.

Car club with an appreciating portfolio of cars.

I have a few cars these days and drive them all on a weekly basis. Probably because none are worth an absolute 'fortune'.

neilbardsley · Post by **neilbardsley** » Fri Apr 27, 2012 9:35 pm

Jasper wrote:I know this is slightly off the point but here goes :-

Sometime ago an idea was floated of having trackday Porsches and the likes at a F1 track in southern Europe for hire, storage etc, fly out in winter 1 to 2 track sessions and fly home, rent or your use your own car which is kept in storage , ready and running for you ? Is it a business runner ?

A friend of a friend does this in Vegas which I think is probably the key. He claimed that his friend got a great rate on the track hire and cars. I think the key is that have to have people coming through with money. It's hard to think of somewhere in europe which is like that.

Jasper · Post by **Jasper** » Sun May 20, 2012 3:06 pm

With the current economic mess the world is in and likely to last 2 more yrs ?
I think it makes good sense to invest in classic porsches and parts like Fuchs wheels, engines, seats etc, no matter what happens they are a currency in themselves IMO.

billy964 · Post by **billy964** » Sun May 20, 2012 4:43 pm

firstly completely agree.. have a set of 964 turbo cup 2's in the garage.. not uber rare, but hard enough to find.. several sets of older 911 seats as well as all sorts pf paraphernalia...or am i just an ebay addict?????

4 years into the economic crisis, i dont think anything will be resolved in the next two years personally (apart from maybe is greece in or out). you are looking at the lost decade europe/uk style i believe.

as for cars as investments.. we've seen classic car bubbles before but i believe there is plenty of money out there for the "right" cars..mainly the ultra low mileage or ultra rare... called after a 19k mile all original sierra rs500 the other day..sold immediately for 45 grand straight into a ford collection.

if you can call it right getting in at the bottom (mate bought 996 gt3rs for 62k with prob the lowest mileage in uk and the condition is truly concours six months ago, check the prices now) then happy days. as for most of us, sensible selection, condition, low production numbers etc will help underpin the value somewhat.. but dealer spreads are wide and if you are looking at your car as an investment you may have to hold out some time to achieve top sale price, making it an illiquid asset.

or just rag it whenever possible!

Jasper · Post by **Jasper** » Sun May 20, 2012 5:56 pm

I fully agree that classic cars are somewhat iliquid, but they are an asset class we know something about ? As the whole financial system is built on a bed of sand and the contegian effect will drag the
stronger economies down, German's and French hold the poorer countries bonds etc and a default will have a domino effect. So it could be a barter system

, set of Fuchs will always have a value same with any air cooled porker.

billy964 · Post by **billy964** » Sun May 20, 2012 6:04 pm

solid gold fuchs 9 & 11's the ultimate hedge!?

Jasper · Post by **Jasper** » Sun May 20, 2012 6:45 pm

I love art and have Steve Anderson & Guy Allen personalise some sketch's for me, you can't drive a painting

I would not agree with gold fuchs kerbing could be costly

Gold is just too volatile I would not have it as a hedge a change in the markets and it can see it swing by 20% in a day.

MFI pumps, 380 mm wheel, Nardi and old Momo's ,15" fuchs, pre 73 911's inc other makes are
a good investment IMO .

billy964 · Post by **billy964** » Mon May 21, 2012 4:59 am

hmmm. so you are saying me emptying the emirates palace gold vending machine wasnt such a hot idea ?

to be honest havent put a bean into shares or ISA's etc for years.. got a couple of 911 i'm very happy with.. the kids will inherit them.. they are even mentioned in my will.. not to be sold!

DDK - Die Deutschen Klassiker