Classic cars as investments

In the last ten years, interest rates in the developed world have been close to nil across the board, and you need to look no further for an explanation to why various kinds of real assets have seen steep increases in price. Cars are definitely part of that group, although it’s unfortunately not the family Volvo that has become a good investment, but rather classic cars and selected sports cars.

Irrespective of the statement above, the Volvo 240 has actually started to appreciate in value…

If you read this blog, chances are you also read other car blogs or follow some car Youtube channels (perhaps even one or several on my favourite list that you can see here). You don’t need to look far to find someone that describes a classic car such as the Jaguar XJ-S that I wrote about last week (see here) as “a good investment” or something that will “most definitely increase in value”. Personally my stomach turns at such unsubstantiated, general statements, but let’s look into whether there’s any truth to them.

In 2015 we launched the new sub-section “The Thrill of Owning” on this blog. We did so seeing the price evolution many enthusiast cars were starting to take, and I wrote about some cars I believed (without guarantee!) would increase in value over the coming years, adding an economic upside to the ownership experience. The first 5 cars I picked were the Lancia Delta Evo, the Honda NSX, the BMW Z4M, the Porsche 996 and the Ferrari 550. Looking back now five years later, it’s clear that had you bought an NSX, a Delta or a 550 in 2015 that you would sell today, you would get substantially more than you initially paid – the first two have basically doubled in price. For the Z4 and the 996, the evolution has been less steep but still in the right direction. Buying and selling is one thing though. Owning is another that should not be forgotten.

An Evo has basically doubled in value in five years, but is far from cheap to own.

Since close to ten years I’m the owner of a Triumph TR4 from 1965, a car that has brought me great joy and that I’ve been extremely lucky with. It hasn’t left me standing a single time and has generally been close to as problem free as a classic car can be. Nevertheless, and even if I haven’t driven thousands of kilometres per year, it still needs regular servicing and old parts will wear out and need replacing. Also, not to forget on a classic car is that the engine will typically need more adjustments than a modern one. In ten years I have thus had it thoroughly serviced and revised three times, redone the breaks once, and replaced more regular wear and tear parts such as the battery, tires etc. in between. A rough estimate is that the car has cost me around EUR 12-13.000 in servicing and parts costs over my years of ownership. To that should be added tax, registration, garage etc., but given how different those costs are depending on your circumstances and country, we’ll leave them aside for this exercise. You shouldn’t though, when you budget your ownership!

My TR4 is living proof that not all English cars fall to pieces!

Had I instead bought that Delta Evo in 2015 my costs would most probably not have been lower, as the Deltas are known as cars needing lots of love an attention. That said, the economic upside would definitely have been higher. On a higher level for the 550 as well, at least with the right car. The bullet-proof NSX may have been cheaper to own, had I been lucky. But again, all this will depend on the particular car you buy, its history, condition – and luck. This is why a statement such as something “definitely increasing in value” is quite simply not true. Firstly, it’s very difficult to say which models will increase in value (although if you know your stuff, I agree you can have a pretty good idea). Secondly, it’s all about the condition of the individual car.

Has my Triumph been a good investment? Price-wise it’s worth around CHF 10.000 (30%) more today than I bought it for, thus covering a fair part of my running costs. In my particular case living in Switzerland where owning and running an oldtimer is cheap, I’ve nevertheless had to rent a garage for the ten years I’ve had it and I’ve certainly not covered the costs for that. It should also be noted that a TR4 is quite a basic oldtimer, with an extremely robust, 4-cylinder engine. Friends of mine who own E-Types, Aston Martin V8’s and other, more advanced cars, will give you a number considerably higher than mine, even though most of them are more capable in a garage than I am and thus do a lot themselves.

The original V8 Vantage – a beauty when it works, a nightmare when it doesn’t…

That’s the economic side of it. On the emotional side, there is no doubt that it’s been a good investment and has brought me much joy and great memories. And that is really the point of all this. Don’t buy a classic car purely as an investment, but also as something to love, drive and enjoy! There will never be any guarantee that an XJS or any other car will be worth more 5 years from now and if you buy the wrong car, you will most certainly not make any money. Arguably it will also reduce the pleasure of ownership, but if this is the car you’ve been dreaming of since you were young, believe me, you will forgive a lot!

Unlike a painting, a car is made for driving. Be thorough in your checks, but also buy with your heart in the sense of loving what you buy, enjoying it, and not to be forgotten, knowing that you will be able to use whatever your dream car is on a regular basis. Good luck!

I hope you like this blog – please help us keep it interesting by subscribing!

It’s Aston time!

If you were to ask a random bunch of people what they thought was the most beautiful car over the last two decades, I’m quite sure Aston Martin would get a lot of votes. Starting with the DB9 in 2004, following on with the V8 Vantage in 2006, and then the Vanquish in 2012 (that Sven fell in love with in an old post in Swedish that you can read here), we’ve been spoiled with beautiful cars coming out of the factory in Gaydon. The head designer at the time Henrik Fisker, who’s also been featured previously on this blog as we’ve written about the Karma, can take credit for most of these, even if he didn’t fully design the DB9, rather finishing off the car that was done by Ian Callum.

The thing is though, Astons have not only looked expensive – they have been so as well. Until now. Because as we speak, around EUR 40.000 will get you a low-mileage V8 Vantage, or for that matter a DB9. That is pretty much a steal, especially in the case of the DB9 which was considerably more expensive than the V8 when it was new. I strongly doubt good, relatively low-mileage cars will get much cheaper over the coming years.

Let’s first settle the fact that although both exist both with and without roof (the V8 is then called the Roadster, the DB9 the Volante), the design only fully comes into its right in coupe form. The fixed roof also saves around 100 kg (meaning around 1600 kg for the V8 and 100 more for the DB9) and means there are fewer parts that can break – not unimportant when you’re talking about a hand-built British sports car, as we’ll come back to later.

The DB9, as a 2+2 seater, is around 30 cm longer. To me the V8 looks nicer, more compact, with better proportions. And given the back seats cannot by anything but very small children anyway (and by the time you buy an Aston, they will be too big anyway…), there’s little reason to choose the DB9 for them. There is however a very big reason to choose the DB9, and that is of course the fabulous, 6-litre, naturally aspirated V12 from the (old) Vanquish, developing around 450-520 hp depending on construction year. The V8 in the Vantage developed around 380 hp as 4.3-litre, and around 420 hp after 2008 as 4.7-litre (in later years there was also a V12 Vantage, but that’s at a very different price point today). Most will agree that power is thus plentiful in both cases, as is the sound, both with 8 and 12 cylinders.

Oh yes!

Both cars were reworked in 2008, meaning more power but also improved build quality, and some slight design quirks. With some luck you can squeeze in a post-2008 car to the EUR 40.000 budget, or stretch it a bit, in which case it’s probably a good decision.

So what’s the downside? Certainly not the engines, that have a solid reputation even in higher mileage cars, as long as they’ve been properly serviced. The interior has aged less well than the timeless exterior design and should be inspected carefully. Unfortunately, there’s also been quite a few quality issues with everything from the slightly upward-opening swan doors, to – many – electrical issues. Therefore, having a specialist inspect the car you’ve just fallen in love with might be one of your better decisions in life. And then there are of course the running costs, and the insurance, and… But then again, if you’re looking for cheap car to own, an Aston shouldn’t be on your list in the first place.

A V8, here in manual version.

Both the DB9 and the Vantage had long runs and large production numbers in Aston terms. The DB9 was replaced by the DB11 in 2016, the V8 Vantage was produced a year longer. Something like 17.500 DB9’s were produced in total and around 22.000 V8 Vantages (exact numbers seem impossible to find!).

To me an Aston is in a class of its own. The “baby” Aston V8 Vantage was discussed as a 911 alternative when it was launched but I think that misses the point. The 911 (at this price point typically a low-mileage 997, or slightly cheaper as a 996 4S) will objectively always be the better car, but you see one on every corner. How many Astons did you see this week? It’s a rare thing of beauty and a traditional driver’s GT car. It’s actually a car where performance is secondary (but not the engine noise!), since its more about the feel, the sound, the whole experience. Personally I would go for a post-2008 V8. But if you want nothing but the best it can only be the V12 DB9. Because a naturally aspirated V12 can never be wrong!