Collector cars as an investment? You may want to think twice

Greg Zyla

Following recent columns on expensive, $250,000 plus collector cars and talking with collector car owners at car shows, I’ve been asked numerous questions pertaining to the collector car market, and specifically if these high end vehicles are still a good place to invest as a long term investment play. One reader asked if individual investors who are not necessarily interested in cars should invest their money in collector cars with a degree of safety and hopes of making a profit in the future.


Years ago, my quick answer would be yes. But today, I’m not so sure.


The words “investing in collector cars” will surely include any and all risk and reward scenarios, much like investing in the stock market. Thus, when someone invests with sole intentions of enhancing a portfolio’s value, be it a collection of cars, gold coins, stocks, or whatever, there is always the possibility of loss based on future economic and/or political considerations. Usually, when the stock market goes up, the value of collector cars go up and when the market falls, collector car values usually soften in unison.


However, things are different nowadays as we are now in an uncharted era whereas an investment in a top end collector car might not turn out too well in the years ahead, regardless of market conditions.


There are two areas of concern in today’s collector car market that worry me. First and foremost is the younger generation, followed second by current political ideology where “green” leanings aren’t very conducive to anything that might throw carbon end- products out of an exhaust pipe. Sadly, and even though I and millions of others look at antique cars as both an art form and an enjoyable hobby, there are those out there that would like to see all older cars crushed and off the roads.


But most pressing is the younger generations, which have grown up with less of an appreciation of the car. I understand it’s certainly not the fault of these younger individuals, who can’t relate to owning a 1965 GTO with a 389 V8 and a 4-speed. These new generations go from point A to Point B in their autonomous driving modern electric car or little 4-cylinder subcompacts as means of transportation .


For the younger set, creating a meaningful “love of automobile” identity just isn’t happening. They all lack the “cruising the avenue” memories that became a rite of passage from adolescent to teen to young adult in the lives of the current flock of senior citizen collector car owners.


Most important, no one is to blame for this situation other than the passage of time. The prospect of a car-loving post baby-boomer generation that not only loves cars but will have enough money to “invest” in them is pretty much wishful thinking. From Millennial to Generation Z, I just don’t see many youngsters coming along to keep the hobby as hot as it is right now.


And hot it is.


Most baby-boomers have money to spend thanks to paid off mortgages, fully ripened 401Ks, company pensions and social security. Add it all up, and the car hobby (along with all the others like boating, camping, motor homes, traveling, coin collecting, etc.) is right now pretty darn good thanks to the boomers.


Further, even though I feel the $250,000 426 Hemi GTX that we featured recently is safe as an investment for a decade or more, there will come a day when the average condition collector car sitting in so many garages just won’t be as valuable as they once were. And my reasoning counters the usual and long accepted “supply and demand” theories on price movement. Currently, the pristine collector cars supply is low while demand is high, resulting in high prices. As for average condition collector cars, I’d opine that the supply is still good while the demand is very good, also resulting in a higher prices.


However, 15 years down the road when many of us old-timer boomers are gone, I just don’t see the demand from the younger generations for collector cars. The supply will still be good, but when the next gens don’t show much interest, that great looking 1966 Chevelle SS396 in average to decent condition isn’t going to fetch $20 to $25K any longer.


This is a tough column to write, because I’m a car lover since my age of understanding (according to my loving, late mom) and I want to see the hobby flourish. And in defense of the hobby/business, there are few cars as beautiful as the heavily chromed, Harley Earl designed, 1953 Buick Skylark convertible, 1956 Chrysler 300 or a gorgeous 1970 Buick GSX 455 when it comes to art form, beauty and performance. (See photos).


It’s easy to say “bring your younger generation grandson or granddaughter to the next car show,” to help grow the hobby, but from what I’ve seen from the generations right behind the baby boomers and beyond, most keep looking at their phones instead of the cars. The main ingredient, not surprisingly, is interest or lack thereof and right now, the smart phones are winning.


Here’s hoping when us baby boomers are gone, something happens to spur new interest in a hobby that takes up a good part of my day. I also thank the good Lord every day for all his blessings, and also that I’ve been able to enjoy the car hobby as much as I have in my lifetime.

And I feel deep inside the man upstairs really likes cars.  
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