Cars as cash cows
ALWYN VILJOEN asks what vehicles can become investments
LET’S say you won big on the Lotto — where would you invest the money so that the capital sum gives you a good return over the years plus quality of life onto the bargain?
The investment gurus are these days all against investing in property if your family don’t live in the building. It’s just too difficult to get rid of bad tenants.
Art can do it for you, but you have to keep the painting or statues in storage for the remainder of your life while you wait for the artist to die before the values will appreciate.
Racehorses? All the experts who try to flog a nag will tell you horses are a sure way to make a small fortune. What they don’t tell you is you have to start with a very big fortune.
A case can, however, be made to invest in metal-clad horsepower — especially looking at the prices rare cars fetched at Gooding and Company’s auction at Pebble Beach last month.
Best of all, you don’t have to wait a lifetime for the cars to appreciate. Half a lifetime will do.
A 1981 Toyota Land Cruiser FJ43, for example, fetched over R2,5 million ($176 000), with the original six-cylinder engine.
The FJ43 is a slightly longer version of the legendary Toyota FJ40 we all know but is less frequently seen than Bengal tigers in the Kruger Park. The owner informed Gooding and Company the Cruiser was used in South America by an energy company for most of its life and it is said to have been well maintained at Toyota dealerships.
It was then purchased by a Toyota enthusiast who used it as a daily drive for years.
The truck was acquired several years ago by the consignor and was restored earlier this year by The FJ Company.
The FJ43 was stripped, restored and upgraded with a host of features, such as a new aluminum radiator, custom roll cage and soft top, leather seats, Old Man Emu suspension, a fivespeed gearbox, and LED headlights.
Look for minty fresh rareness
So which cars on shop floors today may yet go on to prove as good an investment as the 1981 FJ43 Land Cruiser? When investing in metal on wheels, there are two keywords and one market truth to remember.
The keywords are “rare” and “mint condition”.
Rare is easy, for rust killed most of the 1980s cars within a decade.
Mint-condition old cars are a lot harder, again thanks to rust.
In sunny SA, all this can work in the investor’s favour. A 1970s bay window VW combi, worth about R20k locally, now sells for over R210 000 in the UK.
Even after export costs, there is a good profit margin here.
But beware the fickleness of the buyers when investing in new cars, for there is no rhyme nor reason to what is in demand, or not.
A Honda S2000, a classic car in all aspects is, for example, currently cooling in average values, but prices for a mint Daihatsu Copen, a cute toy car, are still within 50% of their new prices of R190k.
This lesser-spotted 1981 Land Cruiser FJ43 fetched over R2,5 million at the recent Pebble Beach auction held by Gooding and Company.