Somebody kindly emailed me this link
www.fool.co.uk/news/investing/2011/04/12/classic-cars-are-recession-investments.aspx
Looks to me like one of those things which could be a complete disaster for all apart from advisers.
1. Buy up lots of stock, and drive prices up and show good notional returns on portfolio.
2. Advisors take a nice cut thank you very much. Probably 2.5% p.a. plus 5% of capital spend. Moreover the big auction houses are able to get rid of their own stock.
3. And then, the fund is to be closed, and flood the market with maybe 1bn (assuming leveraged, and the 17% returns are achieved) of classic car.
I think not...
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Yeah, yeah. We've heard all this tripe before - things like this were surfacing at the peak of the last boom in old car prices, 20 years ago now. A lot of fingers were burned then and it's about time a lot more were burned now.
Old cars aren't bits of paper to be traded. They go wrong and go rusty even when they don't move and they have to be stored, maintained and transported around. They are also subject to whim and fashion trends on the part of often ignorant buyers.
You would indeed have to be a Fool to get involved in that one.
Last edited by: Mike Hannon on Thu 12 May 11 at 10:20
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Plenty of people still have their overpriced classic car "investments" that they cant shift after the last bubble. To invest money in "classics" they have to be truly exceptional with unique history.
Last edited by: Zero on Thu 12 May 11 at 10:23
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At the end of the day a classic is worth what someone is willing to pay for it.
Isn't that right, Mr Evans?
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There's something strangely loathsome about charming Heath Robinson devices like chain-drive Frazer Nashes and Aero Morgans being stored and allowed to become sclerotic by dog-in-the-manger carphound 'investors'.
Similarly, there's something loathsome about people who talk about automobiles being 'artworks' or 'icons'. Pseud's corner, makes you want to throw up.
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A cost effective way of investing in classic cars is to buy a working car just before it becomes old enough to be a classic, and then use it as an ordinary car for as long as it lasts.
If you buy just before the price of an old car bottoms out, it will keep its value and give you cheap motoring. Either it will last, and justify maintenance costs until you end up with a modest profit, or become uneconomic, in which case someone else will want it for spares.
There is to my mind much more pleasure in using a cheap old car everyday than in seeing a shiny example in a collection.
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Been there, done (doing) that.
All you need is the wisdom of Solomon at the choice stage and a large slice of luck from then on.
Incidentally, I have become very fed up with the word 'iconic' in old car magazines. I suppose even a Hillman Avenger, for example, is an icon of mediocrity.
Having said that, my friend has two immaculate Avengers for sale should anyone feel a strange urge...
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>> two immaculate Avengers for sale
Oh my sainted aunt. What a graceless ugly damn thing the Avenger was.
Strangely enough though, considering what it looked like, the Avenger was raced with a measure of success for a shortish time. The engine was easily tweaked at lowish cost, had absurdly strong valve springs so could be over-revved without any need for special ones. I remember seeing them at Brands Hatch. They were very noisy, a loud crackle.
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The saloon Avenger was the real affront to decency, especially when it was facelifted from Hillman to Chrysler. The estate was much better proportioned, my eight-year-old self thought.
What Car? in February 1977 preferred a chocolate brown Avenger estate to a yellow Renault 12 and an Escort that may have been a shade of bronze. I remember this because the R12 estate was the family's wheels at the time, and it was my first experience of seeing my dad's car reviewed in print. At least it beat the Escort, which "lacks two doors and much equipment". This was some achievement, since the Renault, by modern standards, had no equipment at all.
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...the Renault, by modern standards, had no equipment at all...
Carpets?
Luxury.
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>> ...the Renault, by modern standards, had no equipment at all...
>> Carpets?
>> Luxury.
There were certainly some very basic cars in the 70's. I owned a mini that had neither carpets, heater nor radio.
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...There were certainly some very basic cars in the 70's...
I sold Renaults in the early 1980s.
The basic spec R4, R5, R6, and R12 had no carpets, only rubber mats.
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>> The saloon Avenger was the real affront to decency, especially when it was facelifted from
>> Hillman to Chrysler.
The 1.8 Avenger Tiger was a treat to drive, though. Much, much livelier than the Chrysler 180.
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>> Having said that, my friend has two immaculate Avengers for sale should anyone feel a
>> strange urge...
>
Think I would prefer the girl who pulled the 5 schoolboy train.
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>> There is to my mind much more pleasure in using a cheap old car everyday
>> than in seeing a shiny example in a collection.
>>
Couildn't agree more Cliff, though it shouldn't be restricted to cheap ones. I get as much, if not more, pleasure from using my old pick-up as it was intended to be used, as I ever would from traipsing it round shows.
Anyone who brings a concours car or motorbike to a show on a trailer should be flogged within an inch of their lives. Then condemned to drive round forever in a white Fiat 500.
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A flogging and a Fiat 500....
Hmm now where is that trailer...
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What's the definition of "classic car"?
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One that's better as a memory than it ever was as an everyday reality?
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The argument has been going on for more than 30 years, to my knowledge. There isn't really an answer.
The only genuine classic car is a Ford (Consul) Classic.
Maybe even iconic...
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Has no-one ever made a car called the Iconic?
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Invest in classic cars - Mike Hannon
