Every dark cloud has a silver lining, it’s said – and there is truth to it. Much of it, of course, depends on your perspective – and your situation.
What if you own a classic car? What if you’d like to own one?
Many of us who already own a classic car are grateful we bought ours when we could afford to. I bought my 1976 Trans-Am in the early ‘90s, for $5,400 – a sum that even then wasn’t much. Back in the early ‘90s, my Pontiac was not yet even an antique; it was just an old car. Such old cars were still abundant back then precisely because they weren’t that old. And most of them were available cheap because the only people who coveted them – for the most part – were young guys like me at the time, who bought them to drive them. To hot rod them.
Then they became investments – bought by older guys with deep pockets, who saw them as a way to make money. Who put them in storage. Or poured money into high-class restorations. Cars like my neither particularly rare nor particularly special ’76 Trans-Am were all of a sudden worth a great deal more than $5,400. Similar cars were all of a sudden (or so it seemed) worth – or rather, selling for – as much as six figures on the auction block at Barrett-Jackson. If Burt Reynolds laid hands on the thing, it might be worth twice six figures.
For a car that guys like me drove to high school back in the ‘80s and early ‘90s.
Even a relatively run-of-the-mill mid-late ’70s not-so-muscular (as it came) car commands as much money as a brand-new car, if it’s in overall good condition. Something like my ’76 would set you back $25k or so, now – which is too rich for most young guys today. And not just because of the sum, itself.
Financing a classic car is not inexpensive, as it is – for now – with new cars.
There are no six year loans at slim to no interest, so as to make the purchase feasible. You are generally expected to make a fat down payment and to pay the whole note off within three years which – plus interest several times higher than the charge applied to a typical new car loan – balloons the monthly payment to more than most young guys can afford.
Even though they could afford – to finance – a new car.
But, this may be on the cusp of changing.
It may soon be the case that a young guy – or gal – will be able to do as I did when I was a young guy and buy a car like my TA for cash.
Just a lot less of it.
In part because the older guys with deep pockets who turned old muscle cars into investments are now old guys. Younger guys – and gals – are going to inherit most of these cars within the next 10-20 years. They may actually want to drive them. Or they may decide to sell them.
But to whom? When few have the big (and superfluous) bucks to spend on a classic car?
With the wheels of the economy falling off right before our eyes, it seems likely that indulgence items such as classic cars will go down in value, for the same reason that all luxury items go down in value when there are no longer enough people to . . . indulge them.
Consider the travails of Duesenberg as an example – as a possible prediction.
Duesenbergs were pretty much the most exotic things on wheels back in 1928; they were all essentially hand-built specials, with custom bodies made tailor-ordered for the buyer. They had exotic powerplants with exotic features, including the first computer-controlled engine management systems. Yep. Really.
Then came 1929 – and all of a sudden it was hard to give away a Duesenberg. The ones that were made in 1928 were sold in a trickle each year after that – and given a model year that corresponded to the year they were sold as opposed to built.
The same happened again, in the mid-70s – when rampant inflation and obnoxiously high gas prices (if you could find gas to buy) caused cars like the late ’60s/early ’70s Hemi-powered Mopars and big-block/low production GM and Ford equivalents to be shunted off to the back lots of seedy used car dealerships, where they often languished unsold for months.
A few young guys bought them, for next-to-nothing. And – fast forward 20 or so – years found themselves in possession of cars almost no one could afford to buy anymore.
We may be on the cusp of another such time. A good time, frankly, for guys – and gals – of all ages who simply appreciate the cars and don’t especially care whether they will appreciate. Who only want to own one – and to leave rubber all over the road.
Just like I did, back in the day.
. . .
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