larryabbott

The following is an article from a recent NY Times about collector cars that decreased in value. The '88 Vette Anniversary edition is referenced toward the end of the article.

TIRED of the stock market’s gyrations? You say that Miami condo didn’t pan out as you had hoped?

Future Shocks for Car Collectors (October 28, 2007) Perhaps, in a flash of financial fantasy, you have mused about riches that would be yours if instead you had invested that cash in can’t-miss collectible cars. Maybe you were tempted by a particular new model that was certain to grow valuable — to buy one and preserve it as a zero-miles example, a shrink-wrapped retirement fund. Collectors even have a nickname for such a practice: pickling.

A look at past financial performance, however, might have you rethinking pickled cars as a road to riches. Few cars deliver a profit to their original owners when inflation, ownership costs and the potential returns of more conventional investments are considered.

One exception is a hot model whose initial demand drives the price well over the window sticker — the Volkswagen New Beetle and Ford Thunderbird were memorable cases — but any such effect is likely to be short-lived.

Here is a selection of automotive investments that fizzled. While some were fine automobiles, they are included here because of their poor performance as investment vehicles.

1963-64 STUDEBAKER AVANTI The last hope of Studebaker’s dying automobile division, the Avanti was a fiberglass-body coupe with handsome styling done by a team working under the famed designer Raymond Loewy.

Any possible windfall for the original Avanti buyers was limited early on: first, the car became an orphan when Studebaker stopped production. Then came the introduction of the Avanti II, a continuation of the original car, albeit with a Chevrolet engine. The availability of a visually similar car, even if it was not the genuine item, has held back the appreciation of original Avantis.

Using the Consumer Price Index inflation calculator at data.bls.gov/cgi-bin/cpicalc.pl, the same $4,445 that an Avanti cost new in 1963 amounts to $30,286 in 2007 dollars. An excellent example, according to the Kelley Blue Book Official Guide for Early Model Cars, is valued at $24,100 today.

1976 CADILLAC ELDORADO CONVERTIBLE The first of the modern can’t-miss automotive investments, this car was promoted as the last hurrah for American convertibles. Impending safety legislation led many to pay huge premiums for cars thought to be the final examples of a breed nearing extinction.

The legislation never came, and convertibles returned. A new Eldorado listed for $11,049 in ’76; recent auction sales for decent examples are in the $25,000 range. Using the C.P.I. inflation calculator, that $11,049 in cash is now equivalent to $40,485. Had the purchase price been invested in a mutual fund that tracked the Standard & Poor’s 500 stock index, it would have grown to $200,000.

1975-76 CHEVROLET COSWORTH VEGA Even the much-maligned Chevrolet Vega flirted with instant-collectible status. One performance version was powered by a twin-cam 16-valve 4-cylinder engine designed by Cosworth, the British engineering firm and racing engine builder. This unlikely combination, with a factory price of $5,916, was deemed a keeper by many owners.

Formerly mothballed examples still exist. A March 2007 sale of a 30,000-mile example in average condition for $8,800 may seem like a tidy profit, but you’d fire any broker who did not deliver a better rate of return over 30 years.

1975-76 BRICKLIN SV-1 The gullwing Bricklin was one of the best cars ever to come out of New Brunswick, Canada. Costing $7,490 new, a better-than-average example can be found today for less than $20,000, according to the most recent National Automobile Dealers Association Classic Collectible and Special Interest Price Guide.

1981-82 DELOREAN DMC-12 With its stainless-steel skin and gullwing doors, the DeLorean looked flashy, but performance from the rear-mounted V-6 engine fell short of the appearance. When introduced, its price was $26,175; the N.A.D.A. guide says an average example will sell for $27,100 today. No wonder so many roam the streets dressed up in “Back to the Future” guise.

1985-91 FERRARI TESTAROSSA The Testarossa was the car to have in the late 1980s, so desirable that it took some luck to find one for sale at its 1987 window sticker of $134,000.

“People were ready to pay $30, $40 or $50,000 over list ” to buy one, said John Levy, a sales consultant with Shelton Ferrari in Fort Lauderdale, Fla. “The more people saw them go up in price, the more they were willing to pay.”

“Then the music stopped,” Mr. Levy said, adding that “a good early Testarossa could be had today for around $50,000.”

1988 35TH ANNIVERSARY CHEVROLET CORVETTE Chevrolet has released quite a few special-edition Corvettes, including Indianapolis 500 pace cars and models for the 25th and 50th anniversaries. One even commemorated the car’s 35th birthday. While 25 is silver and 50 is gold, 35 is coral — endangered, yes, but not something that savvy investors hoard as an inflation hedge.

The same is true for the Corvette’s 35th — interesting, but hardly investment grade. If you had invested your $34,275 at the rate of inflation and walked to work, you would now have about $60,406. A very nice example of one of the 2,050 built will cost you about $21,000 today, according to the Cars of Particular Interest Value Guide.

1982-91 PORSCHE 944 The years have not been kind to the values of Porsches from the 1980s. As an investment by an original buyer, the saddest case of all may be the 944, a front-engine water-cooled 4-cylinder car that followed the tepid 924 in both design and execution. At introduction, the 944 cost $18,980. Today, one in good condition is worth $4,100, according to Kelley Blue Book.

djpatrick35

It's just stupid to mothball any collector item, cars or anything else. These things are meant to be enjoyed, especially cars. I used to have a 35th Anniversary car and I loved it in the short time I had it. But I also drove it, because that's the way it should be.

VtVette

With the exception of a very few number of cars (one - off's, 1st/last off the line or a rare model, and some survivor race cars) cars are built to be driven, especially with todays high production numbers. Leave investing for real estate and securities. Drive the cars.

pkazsr

I wish my 88 Anni was worth sticker price, 19 years later. To me priceless. To a collector, just another C4. I still wave to all Vettes I see.

CorvetteMike2024

My vette and harley are worth gold to me. I drive them everyday and enjoy!!!! Its not miles per gallon, its smiles per gallon for me.

Wezel

A great example of the "Cost of Consumption". You can chose to spend or invest.

(I just "invested" in a 2007 coupe; it's the perfect ride).

clay69

I know a guy that works for a Harley Dealer and he has had guys come in to buy certain bikes and that is what they do have them put together no gas or oil and then they trailer them home and they have these air bubble things that they store them in.
He told he has seen it quite a few times.


I agree with the other post enjoy them and drive them.
I have had lots of old cars a 54 chevy a 68 chevlle and I now have a 96 CE corvette and 57 Belair and 3 bikes I ride/drive them all rain or shine I enjoy the things I have..
if I want to invest it will be in a 401K or stocks or bonds..

GIJoe

Most of the people I talk to at car shows mothball their cars. its pretty sad. A car is NEVER...EVER a good investment.