Understanding classic car investment and ownership

Sudhir Matai chats with Group CEO of Moto Village, Antony Ashley, about collectable vehicles as investment opportunities

By Sudhir Matai

Classic cars have become real alternatives to traditional investments. The values of certain models outstrip even the best hedge funds by but how does one decide what to buy? I sat down with Antony Ashley, who heads up Moto Village in Cape Town, a collectible car sales dealership and storage facility that offers international transport and collectible car finance.

It’s believed classic cars have become appreciating assets and serious investors are in on the act. Is this true?

Buying classic cars purely for investment purposes, with no emotional attachment is one way of doing it. In fact, there are countless blue chip portfolio collections around the world built entirely for capital appreciation. However, there is a great deal of owner satisfaction in that one can drive and enjoy these items more than any other in your portfolio. For example, you can’t drink the wine you’ve bought as an investment and whiskey devalues if you open the bottle.

How does one choose a model that will appreciate over time?

There are a few basic principles we apply to evaluate a car’s suitability. The first is rarity. And that’s basic economics of supply and demand. The fewer units that exist, the higher the value of each. Then we look at vehicle condition. The closer a car is to the state it left the factory the better its value. History is another factor. Cars with complete service records, invoices for work carried out ownership documentation, a heritage certificate confirming exact model spec and any articles where the vehicle has been featured in the press. Racing or motorsport records also drive up value. Desirability in the current collector market is key. And this is an important one. Certain models fall into and out of vogue with time this is where it is crucial to chat with market specialists to learn about cars that are on the up.

How does one maintain the car’s value while still enjoying it?

These vehicles, which are typically ageing, need to be treated with a certain level of care. Since the classic car boom started about a decade ago, a cottage industry has become more important than ever to maintain these vehicles in pristine working condition. It is imperative that owners enlist proper care from people or workshops you know exactly what they’re doing. Off-season storage is also very important for older cars to stay in good condition. Insuring with the correct providers also vital. Large scale insurance companies typically don’t understand the space, which is why we recommend a few specialist firms.

This all seems esoteric. Should people really invest in the sector?

Of course, as with any form of investing, one needs to do their homework. If you’re buying stocks, investing abroad or buying luxury property, you’re going to enlist the services of a specialist. This is where a firm such as Moto Village comes in. Companies like ours can guide potential clients on this journey. Whether it’s a single desirable car you’ve always lusted after, or an investment-grade portfolio of cars. There’s help at hand.

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