For Love or Money? The High Cost of Automotive Speculation
What do Bugatti’s Veyron, Chevy’s SSR, Lincoln’s Blackwood, and Plymouth’s Prowler all have in common?
If you said that they’re all cars you’ve long since lost interest in, you’re on the right track.
Experts are predicting that the aforementioned models, all the pursuit of car collectors across the country at some time, are models that are decidedly unlikely to live up to their speculated value.
While Bugatti still can claim quite a premium for its ultra-everything supercar, consumer demand for the car that is now more expensive than ever (thanks to unfavorable exchange rates) is on the decline.
Short-lived consumer frenzy drove up the asking price for concept-like trucks, SSR and Blackwood, with auction prices sometimes reaching six-digits in the early going. Now days, the NADA used car guide claims that both the Chevy and the Lincoln can be had for a much more modest $21K and change, not exactly a stunning return on the automotive investment.
A similar sad story can be attached to the Prowler’s legacy, whose loss of public interest (and high sticker price), can be traced to the old culprit of being “more show than go.
Comments
Steve K.
Start with an astronomical price, and you can't help but see the value decline. By contrast what did a 55-57 Chevy cost, or 64-70 Mustang or 67-71 Camaro Z-28 cost. They started out as affordable, and a good example of any of them would command 3-4x their original msrp, sometimes even more nowadays. If you start out over priced, it can't go anywhere else but down. Most of these collectibles are just now selling for what their MSRP should have been to start with.
Mitch K.
i think it's worth pointing out, that vehicles like this are like investing money - long term. (ok, maybe only the bugatti - but i digress.). You really don't see too many of these vehicles around at all, so given time, they'll probably be worth quite a bit of cash...
Rex
As I agree that these vehicles don't seem to represent a good return now (except the Bugatti). I think it's good to remember that the models listed here are niche vehicles (except the Blackwood 2000 edit. which where just crap). They may not be valuable now but as they become rare and few are in good working order their value will grow. I especially believe the Prowler and SSR will be the darling of future auto collector's. While some collectors buy for presumed later value, most collectors buy on emotions and nostalgia. I’m actually surprise to hear that the value of the SSR increased shortly after it was released. I guess????
The Stig
I can't see those (save maybe the Veyron) being collectible. They weren't spectacular cars when they were new, and time won't improve that. If anything they'll just be interesting footnotes in history. You can add the GT500 to that list. I saw a local dealer advertising a 2008 coupe for $68,000. They better dump that thing before the Camaro and Challenger are released. Just because a vehicle is rare and didn't sell well doesn't automatically mean it'll be worth a ton of cash in the future. Very often cars didn't sell well for a reason.
Jonathan Fung [Gotakon]
I can't see why anyone would even bother investing in cars to hope for a return. If you want to roll the dice in investment, that's why man has invented the stock market. On the stock market, you get an average return of...what was it...7 to 8% a year. I doubt the Veyron will appreciate that quickly.
Ducati Minor
I'm somewhat with The Stig: the SSR, Prowler, and retro T'Bird were, basically, rolling fads that could have managed better with lower production and prices. (The SSR and T'Bird could have used more power, too.) And I completely agree about the Shelby: the Ford dealership in Downey has had two Shelby GTs and a GT500 collecting dust for months.
I'm not so much with Stig about the past classics. The De Lorean DMC-12, mid-seventies E-body Mopars, and early '50s Corvettes were not spectacular cars. The high-priced 440 'Cudas, L-88 Sting Ray Corvettes, and Boss 429 Mustangs weren't wheeled wonders--they had the steering of an aircraft carrier, 60% of their weight at the front, and sucked down more gas than an Airbus.
Business disasters have created classics: the Cord 812, the C1 Corvette (despite that rough start), the AMC AMX, and the Kaiser-Darrin were all commercial failures. Yet, the command quite a permium today.
John Carder
Mitch,
The "new" Thunderbird didn't sell many (~5K units, if memory serves), but I wouldn't hold my breath waiting for it to go up in value. It requires both scarcity and emotional desire to drive up the price.
Muscle Cars World » Blog Archive » Question of the Day: What
[...] Everyone knows most cars lose their value as soon as you even think of buying them, but every once in a while a vehicle comes along that doesn’t depreciate instantly. We already know cars like the SSR and Prowler aren’t good bets in the long run. Which current vehicles do you expect to hold their value the best for car collectors? [...]
Aaron
I agree with DM, those "footnotes" of automobile history can sometimes demand even higher values. The 1984-86 Mustang SVO was a sales flop. Despite being one of the best handling 'stangs of all time, nobody wanted to pay "extra" for a 4-banger mustang. Now, I presume it's the most sought-after mustang of it's decade, by far.
Buick Grand Nationals: some story.
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