What shape will the car industry be in after all this?

Nayf

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Maybe I am a contrarian here, but we might actually see an improvement on classic/rare car prices, following unpresedented synchronised monetary policy and collapse of long term rates.
This. The prospect of negative interest rates means there’s a rush for assets. There’s also ‘survivor justification’; I could die at any moment so why not enjoy my cash. With regards to which cars, then stuff pre-2005 and certainly pre-2000. There are few cars available in decent nick, supply and demand rules. Add in nostalgia too...
The rush away from public transport is driving a surge for ‘cheap’ cars. Auto Trader is reporting double digit searches for sub £1500 cars.
It’s a great time to buy post-2005 cars. There are lots of them about, so plenty of choice. There isn’t the same nostalgia that feeds the older stuff feeding the market yet.
 

Nayf

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Agreed. All these baby boomers had it good and have continued to have it good until the last few years.

I suspect they could be selling assets soon to pay for high care home fees.

The XR3i stuff at £20k+ never made sense to me. The GTi-6 is still and old school hatch fairly rare now and a much better car at much lower prices. The XR3i never made sense and the XR3 was worse.
Not this again. ;) I’ve spent far too long explaining this. Including yesterday on twitter about a £16k XR2i.
Simply, what a car is ‘worth’ has absolutely nothing to do with how ‘good’ it is.
What a car is worth is on its supply and demand. Ford fans are the biggest demographic within the classic car scene, and they are also well funded. A good proportion will never be interested in supercars, despite having the money for them. They certainly have the money though, believe me.
However there are very few XR2is left. Less than 500, probably less than half that and even fewer in mint condition. Supply and demand dictates...

Also that £16k XR2i was fully restored. You’re not buying an XR2i, you’re buying the restoration. A decent paint job can cost £5k-£10k alone. Parts are scarce and pricey too, then there’s labour.

So yes, the 306 GTI-6 is a much better car. But fewer people dream of owning one. Which is why the XR2i is worth more..
 

dickygrace

www.richardgracecars.co.uk
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Most of the super rich will be unaffected or affected less by this impending financial crisis I see playing out. The poorer section are not in a position to buy something like this now or after. The key section of the population that would be prime to be in the market to benefit from reduced pricing on something like this I see as the likely the most affected by this crisis. Therefore they won't be in a position to buy. There is an exception to that thought but it won't be many and I suspect this will be the last thing on their mind.

I could well be wrong of course and this is only my uneducated personal opinion.

Even if a Portofino was £50k I still don't want one.

I just don't see there being a bun fight to buy or own any of these cars.

The Super Rich will have lost more money than anyone, but they’re often the ones who employ everyone else.

The most affected by the economic crisis to come will be the lowest paid, always is.

Only the top 2-3% of U.K. population are likely to be in the market anyway, and I do see this continuing. I think we often lose sight of our wealth, £25k a year is the top 1% worldwide.

If a Portofino was £50k, I’d have a 458 at £30k instead. Or a £10k late Gransport LE. It won’t happen.
 

rockits

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9,167
Not this again. ;) I’ve spent far too long explaining this. Including yesterday on twitter about a £16k XR2i.
Simply, what a car is ‘worth’ has absolutely nothing to do with how ‘good’ it is.
What a car is worth is on its supply and demand. Ford fans are the biggest demographic within the classic car scene, and they are also well funded. A good proportion will never be interested in supercars, despite having the money for them. They certainly have the money though, believe me.
However there are very few XR2is left. Less than 500, probably less than half that and even fewer in mint condition. Supply and demand dictates...

Also that £16k XR2i was fully restored. You’re not buying an XR2i, you’re buying the restoration. A decent paint job can cost £5k-£10k alone. Parts are scarce and pricey too, then there’s labour.

So yes, the 306 GTI-6 is a much better car. But fewer people dream of owning one. Which is why the XR2i is worth more..
You might be right until now Nathan but I fear times are changing. These will only end up as museum pieces possibly soon. Who knows how this will play out.....not me for sure but I am sure there will be significant changes forever for various reasons.
 

rockits

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9,167
The Super Rich will have lost more money than anyone, but they’re often the ones who employ everyone else.

The most affected by the economic crisis to come will be the lowest paid, always is.

Only the top 2-3% of U.K. population are likely to be in the market anyway, and I do see this continuing. I think we often lose sight of our wealth, £25k a year is the top 1% worldwide.

If a Portofino was £50k, I’d have a 458 at £30k instead. Or a £10k late Gransport LE. It won’t happen.
They laughed at Peter Schiff in 2006 and 2007. Physcially laughed in his face. Laughed him off TV. He was right though.

It is and will change that is in no doubt. The question is how and and by how much.
 

Nayf

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You might be right until now Nathan but I fear times are changing. These will only end up as museum pieces possibly soon. Who knows how this will play out.....not me for sure but I am sure there will be significant changes forever for various reasons.

If anything, these Fast Fords are only ever museum pieces anyway, so the relevance as to how they drive makes even less of a difference.
It’s also worth noting that just because the ownership profile isn’t quite what many picture as being a well off person, it doesn’t mean they aren’t. The Shiply guy who moved my 156 owned a Saff Cosworth, a Lotus Cortina, an RS500, a Mk2 RS2000 and another half dozen...
 
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rockits

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Sorry @rockits I don’t know what this means.
Peter Schiff is a US economist and broker who predicted the GFC way before it happened during times of immense US wealth, bouyancy and growth. His predictions were so out of whack with most of the US finance sector they just laughed. They stopped laughing some months/year later!

You won't want to see it as it is your business and your livelihood. It pays to open your mind a little and maybe think of hedging yourself a little or making sure you aren't affected if things change. I'm just looking out for you as I'm concerned.

I agree run of the mill daily stuff will still be required and low to mid end cars up to maybe £25k could be affected much less.
 

dickygrace

www.richardgracecars.co.uk
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7,309
Peter Schiff is a US economist and broker who predicted the GFC way before it happened during times of immense US wealth, bouyancy and growth. His predictions were so out of whack with most of the US finance sector they just laughed. They stopped laughing some months/year later!

You won't want to see it as it is your business and your livelihood. It pays to open your mind a little and maybe think of hedging yourself a little or making sure you aren't affected if things change. I'm just looking out for you as I'm concerned.

I agree run of the mill daily stuff will still be required and low to mid end cars up to maybe £25k could be affected much less.

Yes I know he predicted it way before it happened as did others. It’s different now, everyone knows it is going to happen.

I’m honestly staggered at the comment above and will refrain from responding.
 

rockits

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9,167
Yes I know he predicted it way before it happened as did others. It’s different now, everyone knows it is going to happen.

I’m honestly staggered at the comment above and will refrain from responding.
I don't follow either so we will agree to differ....about what I don't specifically know but clearly we have a slight difference of opinion on some aspects of this.

I don't mind you responding. We are all adults here and I'm pretty thick skinned so feel free to fill your boots. There shouldn't really be restrictions on free speech to a point should there? This is what these discussions are all about.
 

dickygrace

www.richardgracecars.co.uk
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I don't follow either so we will agree to differ....about what I don't specifically know but clearly we have a slight difference of opinion on some aspects of this.

I don't mind you responding. We are all adults here and I'm pretty thick skinned so feel free to fill your boots. There shouldn't really be restrictions on free speech to a point should there? This is what these discussions are all about.

It was the condescending nature of the post that irked me being honest. Unless I have completely misunderstood, and I wasn’t disagreeing about the impending recession, I was just saying that there are more buyers of used Ferraris than new ones. You then decided to tell me ‘You won’t want to see it’, to ‘open your mind’, and that you’re ‘just looking out for me’ when you have no idea at all about my situation.

‘ You won't want to see it as it is your business and your livelihood. It pays to open your mind a little and maybe think of hedging yourself a little or making sure you aren't affected if things change. I'm just looking out for you as I'm concerned.’

I do hope it’s simply my misunderstanding as you and I have disagreed in the past but never treated one another in a condescending manner.
 

rockits

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9,167
It was the condescending nature of the post that irked me being honest. Unless I have completely misunderstood, and I wasn’t disagreeing about the impending recession, I was just saying that there are more buyers of used Ferraris than new ones. You then decided to tell me ‘You won’t want to see it’, to ‘open your mind’, and that you’re ‘just looking out for me’ when you have no idea at all about my situation.

‘ You won't want to see it as it is your business and your livelihood. It pays to open your mind a little and maybe think of hedging yourself a little or making sure you aren't affected if things change. I'm just looking out for you as I'm concerned.’

I do hope it’s simply my misunderstanding as you and I have disagreed in the past but never treated one another in a condescending manner.

I apologise if I came across as condescending. It certainly wasn't meant that way. I'm genuinly concerned that's all.

I really don't feel I'm in strict position of intellect, class or knowledge to be even be condascending. I struggle to even spell the word! Also without a crystal ball my comments are just my worthless opinion and that is all. I really wouldn't care or worry about what I think or say. It is what you think that truly matters I would suggest. Well that is how I tend to work myself.

Of course you know your business much better than I do as it is your day job and certainly not mine. I guess I should not worry as I am sure you have been through the thought process also how to position yourself.

I understood the car market especially Ferrari and other like then have been over producing cars. I read somewhere that of all the new Ferrari sales 50% were bought by existing Ferarri owners of 4 cars or more. If these guys start to thin out numbers there will likely be more Ferarri's on sale than there will be a market for. Also a potential other playout is all the owners that have a 3rd car or more just for fun will possibly sell these first to release asset value if they need cash. I will certainly do if I need to.

Bizarrely enough although I always wanted an automotive related career I'm glad I'm in the IT/tech sector at the moment and for the immediate future. Certainly a solid industry and very much a growth one for years to come.

Who knows? We will all find out in the next few years I expect.
 

Ewan

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6,757
I have no interest in XR4i’s whether £2 or £20k, and it makes no difference to the value of classic Ferrari’s. I am friendly with several other Ferrari owners and none of us have Fords, so I don’t see the link in values. Not all classic cars are the same, so generalising is fairly pointless.

And if I could find a nice Portofino for £100k I’d buy it today, while the sun’s out. So if you get one Dicky, give me a call!
 

Wagons-Lits

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250
I’d suggest it’s the other way round. I’d suggest there’s a larger market for a used Portofino at £100k than a new one at £250k. Surely there are more people across all marques that can afford a used example as oppose to a new one.
It’s an interesting point and I guess my question is , where does this leave the cars that were previously occupying the £100k space? I get the feeling the guys/gals on here are a specific minority - and the bulk of the buying public is much happier with a new Ferrari (Thats suddenly in their price range) with all the toys and mod cons and warranty vs a 10 year old car

I think classics/modern classics will become even more targeted - eg you want that specific car - vs people being pushed to them/embracing them bc they couldn’t afford something new or nearly new

thoughts ?
 

Nayf

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2,734
I’d be eyeing up E36 M3s at the moment if I had the cash. 328i Sport manuals, if you can find them.
E39 and E34 M5S also interest. MkI SLK in bright colours, perhaps. Jury’s out on the Puma; it’s a Ford, but it has neither an XR or RS badge. SportKa and StreetKa - if you can find one that hasn’t oxidised - might be worth putting away. Ferrari 360 is looking good value at £60k.
The young adult of the 1990s is now reaching 40-50. Who knows, we may see a spike in demand for French hot hatches - the Clio Willy is already in the teens, and Rallye Pugs are getting chunky. Not many of them left, which means supply will be limited. 306 GTI-6 too. I wouldn’t bet against the Saxo VTS/R.

There’s a cultural shift (not just cars) towards the 1990s being ‘mainstream retro wonderful’; for the past three/four years it’s been niche appeal. The next wave of cultural influence will be the 90s.

Edit: Corrados and Integra Type Rs too.
NSX and R33 Skyline too. R34 already gone and going. NSX fluctuates already but the next waves of moneyed buyers entering the market will be slightly different to the ones who bought them before.
 
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rockits

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9,167
I think the lower stuff will be affected less as in more of the populations price bracket.

I have never spent more than £25k on any car I have bought for myself ever. Only breaking this once to spend £26k on my wife's Discover Sport.

I still don't see the need to spend more than that £25k and possibly never will ever again. I might not be normal or your average punter though.

Your average Joe, including me can't afford a new or modern Ferrari at even half the current prices. This won't change. With the added adage that a £200k Ferrari new or used will still have £200k running costs.

Aside from the fact I would look like a kn0b in one. Doesn't seem worth the hassle you can get attracting undesirable attention in them. Which is a shame and shouldn't matter but it seems to.

I don't really care what the rest of the market do or what they buy at what price. If they want to Hoover up 'cheap' Ferrari's they can knock themselves out. Enjoy them and don't worry about the money. I just happen to need to be careful with my money.
 

rockits

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9,167
I do have an issue with paying more for something used than it cost new so that doesn't help. I just have issues finding value when something 20 years old cost more than it cost brand spanking new.

I was always brought up to value used items at an average of 50% of their equivalent new cost. Clearly this doesn't apply to many old classic cars.
 

Motorsport3

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869
I do have an issue with paying more for something used than it cost new so that doesn't help. I just have issues finding value when something 20 years old cost more than it cost brand spanking new.

I was always brought up to value used items at an average of 50% of their equivalent new cost. Clearly this doesn't apply to many old classic cars.

I'm like you, though also have in mind that 2% inflation over 20yrs is 50% higher price. 3% inflation over the same time is nearly double of nominal price.
 

rockits

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9,167
So allowing for inflation it makes the price more in real terms? So a car needs to increase in value by min inflation just to stay the same price?

Make sense. So something like a 430 hasn't lost a been pretty much.

That would be the only time I might ever buy a new car or a more expensive one if it would hold its price or increase but I guess that is the holy grail for anyone.