By DENIS FINNERTY
For most people the idea of investing in automobiles or other vehicles is completely foreign. It might even seem like an oxymoron. Most people experience the everyday car buying experience, buy the car, drive it, it depreciates, then sell or trade it. This is how most people view the automotive industry. However, there is another side to the car business.
There are people that buy, sell and trade vehicles, like stockbrokers trade stocks on Wall St. I am just returning from Barrett Jackson's Inaugural Northeast Collector Car Auction. This is their first event in the Northeast, and was held with record attendance at Mohegan Sun Casino in Connecticut. While I was there, it occurred to me that my experience with many different people in the hobby varies greatly from the experience of the general public.
Among the bidders at the auction, there are a variety of reasons for their attendance. Some are there selling, some are there to buy a new "toy," and, as I mentioned, some are there to invest. Let's just cover that aspect for a moment.
Just like stocks trade, cars and other specialty vehicles trade at different levels, there are people who just buy certain brands or models, there are others who will buy multiple cars and cost-average the purchases, and there are groups that pool their funds to buy ultra-high-end rare pieces. The equivalent of penny stocks would be lesser expensive classics, often bought, enjoyed for a short time, then resold.
The other end of the spectrum would be cars such as a super rare one-off Ferrari, sometimes street cars, sometimes race pedigree. These are the cars that are only traded between elite buyers, collectors or investment groups. The price tag for these vehicles starts in the millions. They are often purchased by a consortium, put away in a literal vault, and held until the market value meets a level the investor would accept as a favorable return on investment. If you watch some of the great television shows, featuring classic cars, or auctions you will often hear terms such as "blue chip" or "investor grade." These are the safer bets, if you will call them that. Just as any investment, there is always risk, the upside to investing in vehicles, is you have a tangible item that you can enjoy, and view while it appreciates.
Now, this arena is not for the faint of heart, the automotive market is fluid. It goes up and it goes down. There are people like me who live the hobby every day, and even I can't predict all the trends. My specialty is antique and mostly American cars. I can't give you advice on Porsche or Ferrari, but I know a guy who has his finger on that pulse, and that is why you will find us all networking at all times to assist our customers and clients intelligently and diligently.
If you are contemplating an investment in vehicles, or even thinking of buying or selling a classic, antique or specialty vehicle, I'd love to meet you. This hobby is fun, family friendly and offers many positive experiences. As always, get out there and enjoy your cars, hope to see you on the road!
Denis Finnerty Finn's Garage Meredith NH www.finnsgaragenh.com.
This 1963 Ferrari 250 GTO traded hands to undisclosed buyers for $52 million at auction in 2013. (Courtesy photo)
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