RK Motors reinvents vintage-car market for Internet
CHARLOTTE, N.C. — “You probably want to see the cars,” says Robert Kauffman, appearing at the door of RK Motors. Well, yes. You’d never know it from the outside, but this grayand-tan hangar north of Charlotte contains a collector’s fantasy garage — more than 300 American classics in a Skittles bag of colours.
Since his retirement two years ago from private-equity firm Fortress Investment, which he co-founded in 1997, Kauffman, 51, has been busy disrupting the vintage-car market. His buyers scour the globe for the rarest Chevelles, Corvettes, Mustangs, Road Runners and other hot rods, which he displays in perfectly parked rows on his shiny warehouse floor.
Not that you have to go to Charlotte to see them. They’re all laid out, in photos and on video at rkmotorscharlotte.com, where you can shop them as though you were perusing power drills on Amazon.com. More than 90 per cent of the 2,200 cars RK Motors has sold since its 2010 launch have been purchased online and almost a quarter have ended up overseas. In 2013 alone, Kauffman says, RK Motors sold 400 vehicles to the tune of about $35 million.
The company is profitable, Kauffman says. But that isn’t entirely the point. The former investment strategist is determined to standardize a business long defined by small, scattered shops and one-off sales from collector to collector.
“What RK does differently, especially in the musclecar space, is that they are straightforward — which certainly isn’t always the case,” says David Gooding, who as president of Gooding & Co. runs vintage-automobile auctions in the United States.
Transparency is the foundation of the approach. “If you go on our website, every single car has a price,” Kauffman says, walking among the inventory in the company’s soccer field-sized showroom. “There’s no ‘please inquire.’”
Each listing includes the car’s sales and restoration history and curators vouch for parts deemed original. If they’re mistaken, which happens a few times a year, RK Motors accepts the car back without question. Kauffman claims the policy builds trust and encourages repeat business, which today accounts for about a third of all sales.
Eddie Gramisci, a North Carolina-based restaurateur, is one such customer. A fervent collector who has worked with dealers all over the country, Gramisci says he’s bought and sold 30 to 40 cars through RK Motors and checks the website about four times daily for new listings.
“They really focus on the quality of the vehicles,” he says. “And they’re better than anyone else I’ve dealt with.”
Kauffman is no stranger to garages. He worked as a mechanic in high school and college — “fixing mufflers for beer money,” he says — and since 2007 has owned 50 per cent of Michael Waltrip Racing, a professional stock car team that competes in NASCAR and is named for co-owner Michael Waltrip, who drove to victories at the Daytona 500 in 2001 and 2003. Waltrip credits his partner’s business acumen for saving the NASCAR team from almost certain failure.
“It was his knowledge and expertise that turned my hobby into a legitimate business,” Waltrip says. “I was in over my head.”
For the latter part of his Fortress tenure, Kauffman led European operations from London and he started RK Motors as a privatestorage facility for his collection back home. Later, he assembled a staff and experimented with buying and selling.
After “making every mistake in the book,” he says, he met Joseph Carroll, a classic-car guru who had been running his own showroom in Ohio. In 2010, they merged the businesses and Kauffman put Carroll in charge of RK Motors with the freedom and funding to develop it into the best shop in the business.
Kauffman says he’s always dabbling with new ideas. Last year, he staged an auction simulcast online from Abu Dhabi, a centre of car collecting that was hosting a Formula One race that same weekend. “It was an experiment,” he says, “but one that I think worked reasonably well.”