03.01.2024
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Luxury vintage cars are a unique asset class that combines historical prestige with financial allure. Think of car brands like Ferrari, Lamborghini or Mercedes and an image of affluence and prestige comes to mind. But these vehicles are more than just status symbols; they are storied artefacts that have transitioned into lucrative investment avenues. This transformation can be attributed to their rarity, exceptional craftsmanship, and historical significance, which all, in turn, increase their financial worth.
At Timeless, we have opened new doors in the investment world by offering fractional ownership of carefully selected classic vehicles—making this luxury investment category available to all.
Through this guide, we aim to delve into the nuances of luxury vintage cars as investments, highlighting their potential for growth and portfolio diversification.
Mercedes-Benz SL 300 Roadster (R107)
The investment allure of classic cars stems from their distinctive characteristics that set them apart from traditional asset classes. These vehicles represent a segment of the market that is largely unaffected by standard economic fluctuations, often showing resilience in times of market volatility.
Their value is underpinned by factors such as historical significance, limited production numbers, and increasing demand among collectors and enthusiasts.
The financial appeal of luxury vintage cars lies in their ability to appreciate over time, often outpacing traditional investments. An example of such an appreciation is the Ferrari Dino 246 GTS. The Dino 246 was the first model manufactured by Ferrari in high numbers. It is celebrated by many for its groundbreaking design, and when production of the model ‘stopped in 1973-4 demand was still high.’ A 1973 model of this car, initially valued at $135,000 in the early days of the Hagerty Price Guide, was later sold for $635,000 in an online auction, significantly over its estimated value, reflecting the appeal of a unique car model as an investment.
The luxury vintage car market in 2023 showed a mix of trends. According to the Knight Frank Report (Q2, 2023) Established brands like Lamborghini and BMW saw a +9% increase in value, while average prices for Ferrari, Mercedes-Benz, and Porsche faced declines.
Nonetheless, rare collector’s models from these brands still managed to increase in value; models like the Porsche 911 Carrera RS 2.7 and Ferrari 288 GTO experienced significant increases ( +87% and +67% respectively), emphasising the value of uniqueness. Bloomberg even named Ferrari and Mercedes as top classic car brands of 2023, showcasing their enduring market appeal.
This is also reflected in the latest auction results: The RM Sothebys auction in Munich (11/23) achieved a total turnover of over 15 million US dollars with a sales rate of almost 90%. Among the impressive top sales were the 1973 Ferrari 365 GTS/4 Daytona Spider with a total of over 3 million euros and the 1957 Mercedes-Benz 300 SL Roadster ‘Outlaw’ with over 1 million euros.
Looking to future classics, according to Top Speed, the 25-year rule brings attention to 90s sports cars like the first-generation Dodge Vipers, now approaching $70k from lower ranges. Recent models also hold potential, with luxury and uniqueness as key factors, exemplified by cars like the 2020 Ford Mustang GT350 and 2021 Lexus LS500.)
The luxury vintage car market presents a varied landscape of investment opportunities, ranging from rare, museum-quality pieces to more accessible classic models, each offering different levels of financial return and investment risk.
At the high end of the market, certain rare models have shown exceptional value growth. German classics, particularly the Mercedes-Benz 300SL Gullwing and 280SL, have demonstrated robust growth.
Over the course of 2023, all 1980s and 1990s vehicles in the Hagerty Price Guide experienced an average appreciation of +4.5%. The modern exotics market, particularly models from the 1990s and 2000s, has continued to attract interest, with significant gains seen in models like the Ferrari F50 and Lamborghini Diablo (18% increase in 2023). This segment, especially cars with manual transmissions, remains a strong area of growth.
The private collector-car market, encompassing a wide range of models and price points, has shown more stability compared to auctions. Vehicles below the $100k mark continue to garner attention, suggesting a healthy market for more accessible classic models. This landscape provides investors with a range of options to suit different investment strategies and interests.
When evaluating luxury vintage car investments, it is crucial to consider several key factors that influence their financial value:
Investing in luxury vintage cars, while potentially lucrative, carries inherent risks such as high maintenance and restoration costs, and the need for specialised storage and insurance.
Here at Timeless, we offer a strategic approach to investing in luxury vintage cars, helping mitigate these risks. Through our fractional ownership model, investors can share in the benefits of owning classic cars without the full burden of upkeep, storage, and insurance. With our deep understanding of market nuances, including valuation trends and collectors’ preferences, we help manage these aspects, easing the investment experience.
Another risk associated with classic cars is market fluctuations. To mitigate that, financial experts recommend a diversified investment approach, including a mix of asset classes, such as art, fine spirits, collectibles and others.
Discover our unique selection of luxury assets, and diversify your portfolio.
Luxury vintage cars represent a distinctive and intriguing investment category that seamlessly blends historical prestige with undeniable financial allure. These exceptional vehicles go beyond being mere status symbols; they embody a unique fusion of rarity, exquisite craftsmanship, and profound historical significance, all of which contribute to their enduring financial appeal. As the luxury vintage car market continues to evolve, it offers a captivating avenue for passionate automotive enthusiasts and astute investors alike. Combining the love for classic automobiles with the potential for financial growth, luxury vintage cars can become timeless assets within diversified investment portfolios.
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