Blog & Talk
These days, we read various articles about the stagnation or even the decline of the vintage car market. How does the situation actually look like when taken into objective consideration? First, we have to differentiate between the far larger market of vehicles in the category below Euros 100,000 and the much smaller, but more exclusive market. While the average value growth of the entire vintage car market over the past 10 years was about 5.8 %, the average value growth in the high-price segment was considerably higher.
The highest increases in value were achieved by classic cars of the premium class over Euros 100,000 in the years 2012 to 2015. Prices rose most steeply in 2013 when the index for rare vehicles of certain brands reached the record level of 45 % (!). However, since this was an exceptional year, it cannot be considered as a benchmark for further appreciation rates.
After 2015, the market has calmed down a bit, but the bubble has not burst since then. The increases in value returned to a “normal level”. Looking at Mercedes-Benz classic cars throughout the period from 1980 to the present, average value increases were about respectable 9% per year. This is an average for the entire classic vehicle program of the brand. The performance of certain vehicle types was clearly above that value.
This raises the question of how reliable such values are or how specific are they? In addition to a large number of institutions and interest groups, the HAGI Index (Historic Automobile Group International) is a competent analyst of the vintage car market, which we use as a reference. The group operates with an extensive database of more than 100,000 actual transactions from private contacts, brand specialists, dealers and auction results, focusing specifically on brands such as Ferrari, Porsche and Mercedes-Benz.
How will the classic car market develop?
The current slowdown in the market is considered quite normal and healthy. Over the last thirty years there have been regular market fluctuations and prices have risen again and again. Therefore, the situation will come up again in a few years. It is said that there will be medium and greater growth in value, but above all in the premium segment, where factors such as quality, history, and changing preferences for certain vehicle types may change – similar to the situation on the art market.
But in spite of all the discussion about value preservation and performance, as we know, the objective of owning or purchasing classic vehicles does not purely correlate with financial aspects. The classic cars are not shares or gold bars stored in the safe of a bank for the purpose of yield expectations. But classic cars’ enthusiasts purchase these cars to experience emotional enrichment, which is part of their lifestyle. Only very few people buy a classic automobile for the purpose of investment. According to research, less than 20 percent follow this agenda.
In his concluding commentary on an interview in the magazine Mercedes-Classic on the current situation in the vintage car market, Dietrich Haplata, Managing Partner of HAGI Index, commented as follows:
“Mr. Haplata, what do you think: What will the vintage car market look like in 20, or 30 years, when mostly self-propelled robot cars will be traveling through the streets of the world?”
“I think that the yearning for cars with steering wheel, gearshift, gas pedal and engine sound will be huge in the age of autonomous traffic. The classics will be even more become symbols for luxury and a special lifestyle than today.”
And even in twenty or thirty years, the statement that has been valid for decades will be heard again:
“At that time, one should have bought one.”
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