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Eye of the Beholder – Market Watch

They have the look of big bucks, but can be had for much less.
Market Watch

Glance through the array of advertised cars at the back of this magazine and you experience a conundrum that has puzzled car enthusiasts for decades. Various models can be totally different in age, performance or presentation yet carry similar or absolutely identical asking prices.

This quandary manifested for me many years ago, back when I believed people who earned a basic income could still afford to own a Jaguar, and bought one.

It admittedly was one of Brown’s Lane’s least admired products, a 420 Compact sedan, but it did have a 4.2-litre engine as in an E-Type, lots of leather and was painted an attractive Opalescent Maroon.

Motor sport and movies made the Cooper S.

It was cheap too, principally because the person selling it didn’t realise that power-steering systems needed fluid and the reservoir that held such fluid wasn’t much use if it leaked.

After paying $1000 less than the advertised price for a car with Armstrong steering, my next visit was to a nearby Jaguar mechanic who charged $60 (it was 1983) to supply and fit a second-hand fluid reservoir. Hey presto, the Big Cat would again turn corners.

The downside was, while fixing the steering, my new-found friend pointed to other issues like a thermatic fan coupling that needed replacement, ancient coolant hoses and differential oil leaks.

Fixing that lot would add $700 to the car’s cost; a detail I omitted to mention when the neighbour’s wife, while watering their roses, asked how much I had paid for the Jaguar. “$2900!” she shrieked when told. “You got that lovely car for $2900 and he – meaning her husband who was busily merging into the front yard shrubbery –  paid $3000 for that?”

The object of her destain was a Mini; almost the same age as the 420, painted an appalling shade of orange with a drainpipe exhaust and very worn ‘rally’ seats. But it was a Cooper S.

Ford’s iconic Mustang turned 60 this year.

“How,” she pondered aloud, “can you get a car like that for $100 less than it cost for that horrible little thing?” How, indeed.

Had someone published a book entitled Cars That Make You Look Cool, the Cooper S would very likely score a mention. And the Jaguar 420 Compact Saloon very likely would not.

There could also be noted the Mini’s blanket victory at Bathurst in 1966, multiple Monte Carlo rally wins or movie stardom via The Italian Job. I could go on.

Reborn classic thanks to a song.

Cars acquire value by association. If enough people consider them to be classics, even though they might effectively be ropey old horrors, then classic they are. Early in the 1970s old Holdens were useful mainly as roosting places in chicken coops, but then along came a bloke called Bob Hudson with a song about his home town of Newcastle and FJs were instantly fashionable. And worth money.

It is common to believe Australian-built classics can’t logically be more valuable than models which appeal to a global market. That is wrong.

Probably half of the 300 genuine Phase III GT-HOs built have survived and even in a slow market, a good one will manage $750,000.

“Even in a slow market, a good one will manage $750,000”

Across the Pacific in 1965, Carroll Shelby was building GT350 Mustangs to gladden the lives of urban warriors, but only made 36 of the Shelby GT-350R competition model for sale to serious racers.

Several years ago, one of two prototypes recorded a US$3.85 million auction price and a ‘customer’ car hit US$1 million. Today’s typical value for a 350R, according to the Hagerty Valuation Guide, sits at around US$545,000 – or about what we might pay here for a fairly ordinary Phase 3. Which would you have?

Buyers of high-end performance and prestige models face a different dilemma, as you will discover via this edition of Market Watch. The exotic GTs featured may look to be worth more than your vastly overpriced house, but some in the current market will be no dearer than a kitted out i30. Ask your work colleague, or neighbour, which they would prefer.

Morris Minor

Image: British Leyland

Today’s market for small cars is a battleground populated by six or more serious contenders. In the 1950s though there were just two significant rivals: the Volkswagen Beetle and Morris Minor.

Morris had the runs on the board, having been part of the local automotive scene since 1950 when the first crates of disassembled cars arrived from Britain. Those MM versions, nicknamed ‘Lowlite’ because their headlights were almost at bumper level, would barely reach 90km/h due to an underpowered 918cc side-valve.

They were comfortable though, with torsion-bar front suspension, rack-and-pinion steering and tall tyres to cushion road shocks.

The year 1951 brought a restyled body with lights at bonnet height to comply with USA regulations. Australians were more interested two years later when a new but smaller 803cc engine with overhead valves and 22kW replaced the side-valve.

The version that followed in 1956 offered 948cc but was universally known as the Minor 1000. It sold here as a two- or four-door sedan, utility and panel van. In Britain, as had been the case since the Minor’s introduction, there was a Tourer with folding roof and also a Traveller station wagon with distinctive, timber-framed rear bodywork.

Local Minors sold in big numbers; more than 25,000 annually based on the numbers of CKD (Completely Knocked Down) cars being exported from the UK. After 1957, sales suffered due to introduction of the local Morris Major and Austin Lancer, but the Minor remained available until 1963.

Looking back to the mid-1980s, Minors survived in significant numbers and very good ones sold for $6000. Parts to maintain and restore decent cars were available from various local suppliers and not expensive. A lot of Minors had by this time been modified, with their original engines replaced by more powerful and less costly Datsun 1200 and Mazda 1300 motors.

Values throughout the 21st Century continued to climb, but not so drastically that demand was affected. With the original overhead valve or later Japanese engines, Minors are economical cars to run and easily maintained. With a replacement differential and higher gearing they will maintain freeway speeds without struggling.

Condition will be more significant to value than age or body style, although a Tourer in restored condition will cost significantly more than other types of Minor. Cars that were restored 20 to 30 years ago and need a return visit to the panel shop, can offer good value so long as their mechanical condition hasn’t faded faster than the paint.

HOW THE PRICES MOVED

2010

Minor Sedan 1948-52: $1600-$6200-$9000

Minor Tourer 1948-52: $3500-$11,000-$16,500

Minor Sedan 1953-64: $1200-$4800-$8000

Minor Tourer 1954-69: $3000-$9500-$14,500

Minor Traveller 1954-69: I/D-$11,000-$16,500

2015

Minor Sedan 1948-52: $1600-$6200-$9000

Minor Tourer 1948-52: $3500-$10,000-$16,500

Minor Sedan 1953-64: $1200-$4800-$8000

Minor Tourer 1954-69: $3000-$8500-$14,500

Minor Traveller 1954-69: I/D-$12,000-$18,500

2018

Minor Sedan 1948-52: $2800-$7800-$14,000

Minor Tourer 1948-62: $3500-$11,000-$18,500

Minor Sedan 1953-64: $2000-$6200-$11,000

2022

Minor Sedan 1948-52: $2800-$7800-$14,000

Minor Tourer 1948-62: $3500-$11,000-$18,500

Minor Sedan 1953-64: $2000-$6200-$11,000

2024

Minor Sedan 1948-52: $4500-$11,000-$18,000

Minor Tourer 1948-62: $5500-$16,000-$25,000

Minor Sedan 1953-64: $2800-$9000-$16,000

DATSUN 240Z-260Z

Image: Mark Bean

When designing its own long-nose sports coupe in the late 1960s, Nissan didn’t need to look very far for inspiration.

Some years earlier, Jaguar’s E-Type had changed the game entirely and produced a template other designers could easily follow. 

In 1969, when the design of Nissan’s 240Z was revealed, it almost exactly replicated the Jaguar’s swooping profile. Also unashamedly included were inset headlights and a hatchback accessing the luggage platform.

Powering the Datsun-badged 240Z was a 2.4-litre version of Nissan’s six-cylinder engine, with twin carburettors instead of the E-Type’s triple side-drafts. It also made do with a single overhead camshaft where the XK engine used two.

Brakes were disc front/drum rear rather than the E-Type’s all disc system, however, Nissan’s five-speed gearbox was way ahead of Jaguar’s four-speed manual that had originated in the 1930s. Nissan’s design also included independent rear suspension.

A year elapsed before Australia saw its first 240Zs and at launch in 1970, the Datsun wasn’t cheap. At almost $5000 it was $1600-2000 more than a Ford Capri V6 or GTR Torana.

A 2.6-litre 260Z version was launched in mid-1974, with improvements including 7.5kW of extra power, altered gear ratios for better acceleration, uprated tyres and better seats.

Ventilation in early cars had been improved but the Z cabin still got hot in summer and air-conditioning was a welcome 260Z option.

Also included in the Z range from 1974 was a 2+2 version on a longer wheelbase, with a folding rear seat and storage space behind it. Although more expensive than two-seat cars, the 260Z 2+2 sold well and plenty have survived.

Few Z Cars took to local race circuits, but the USA had categories where they could challenge Porsche, Triumph and Jaguar. Here and in other parts of the Southern Hemisphere the emphasis was on rallying, with Zs twice winning the tough East African Safari Rally and taking West Australian Ross Dunkerton to three Australian Rally Championships from 1975-77.

Decades would pass before the 240Z and 260Z made significant gains in value. Even worse was the 2+2’s performance; lagging until recently and still making only half the price of an early 240Z.

Most expensive, due to their appeal on the world market, will be the Japanese specification Fairlady Z, with wheel-arch flares and the option of a twin-camshaft 2.0-litre engine.

Local 240Z prices look to have peaked after their 2020-22 surge, with excellent cars below $100,000 and good quality two-seat 260Zs a further 20 per cent cheaper.

HOW THE PRICES MOVED

2010

240Z Coupe 1970-74: $6000-$17,500-$24,500

260Z Coupe 1974-77: $4500-$13,500-$21,000

260Z 2+2 Coupe 1974-78: $2700-$7800-$11,000

2015

240Z Coupe 1970-74: $9000-$20,000-$33,500

260Z Coupe 1974-77: $6500-$16,500-$25,000

260Z 2+2 Coupe 1974-78: $3800-$9000-$14,000

2018

240Z Coupe 1970-74: $12,000-$33,000-$48,000

260Z Coupe 1974-77: $9500-$27,500-$42,000

260Z 2+2 Coupe 1974-78: $4800-$18,500-$27,000

2022

240Z Coupe 1970-74: $28,000-$61,500-$82,000

Fairlady Z 1970-72: I/D-$70,000-$110,000

260Z Coupe 1974-77: $25,000-$56,500-$74,000

260Z 2+2 Coupe 1974-78: $14,000-$31,500-$42,000

2024

240Z Coupe 1970-74: $28,000-$54,500-$77,000

Fairlady Z 1970-72: $37,000-$70,000-$100,000

260Z Coupe 1974-77: $23,000-$39,500-$62,000

260Z 2+2 Coupe 1974-78: $14,000-$32,500-$44,000

FIVE AFFORDABLE EXOTICS

Folklore decrees that if you keep something for long enough it could eventually become valuable. Problem is, some things can’t just be pushed to the back of the sideboard and forgotten for decades. Cars are among them.

Almost any new car will drop 25 to 30 per cent in value the moment it is registered and continue to decline over several years, sometimes decades.

High priced, prestige models have a reputation for gobbling up owners’ money at prodigious rates, but people who buy them new seem not to care.

For a while there wasn’t a significant problem because high-end models produced during the 1960s and ’70s did hold value and today can be worth many times their original cost. During the 1990s, as car prices soared and average incomes didn’t, that dynamic changed.

The cars you see here all would have cost around the same when new as a decent house in a good metropolitan suburb. When comparing the Ferrari, its real-estate equivalent would be a mini mansion with triple garage and pool.

If depreciation during the 1990s looked bad, then the next downturn was appreciably worse. This was the one that went by the name of Global Financial Crisis or GFC.

Auction barns during 2008-09 began filling with cars that just days earlier had occupied spots in executive car parks. Now they would be battling for slots in prestige dealer yards at prices a fraction of the finance contracts they had left unpaid.

Declining prices during the past decade still haven’t boosted used-market demand and a lot of older prestige models remain hard to sell.

Which factors might exert pressure on prestige values into the future is anyone’s guess. The best strategy for now is to pick a car that suits your means and lifestyle and revel in an experience you could not have contemplated when the car was new.

ASTON MARTIN DB7 COUPE

PRICE NEW 1996: $249,445

PRICE NOW CONDITION 1: $62,000

Image: Aston Martin

Closely related in size and design to the XK8 Jaguar, Aston Martin’s DB7 came initially with a supercharged Jaguar engine, then a V12 that had been cobbled together from a pair of V6 Ford engines. Nobody seemed to mind all of this parts-bin engineering and platform sharing as it was helping keep two iconic British brands – Aston Martin and Jaguar – alive while under the haphazard ownership of FoMoCo. The first new-style Astons available to Australia were DB7 coupes, priced initially at almost a quarter of a million dollars. They arrived towards the end of 1995 but it took time to re-establish the Aston Martin brand in Australia. Sales during 1998 finally reached double digits, comprising 10 coupes and three Volante convertibles. The soft-top DB7 had been launched a year earlier at almost $280,000 and it came as no surprise that few found local owners. These are still classy cars though, with exclusivity on their side. Available cars are more likely to have been sold new in other countries but these are (or should be) less expensive than local deliveries. Fear of the unknown is a major factor in the restrained values of later model Aston Martins. Service support, even in major Australian cities, isn’t easy to find and parts are relatively expensive for a car that continues to decline in value.

FERRARI 456GTA

PRICE NEW IN 1996: $493,863

PRICE NOW CONDITION 1: $135,000

Image: Ferrari

Yachting, so they say, is akin to standing under a cold shower tearing up money. Owning a front-engined Ferrari – a modern one anyway – must feel somewhat similar. Ferrari had been doing well for several years with its array of mid-engined models, having deleted the slow selling 400iA V12 in 1985. In 1992 though, it announced a new front-engined, V12-powered 456GT which was released to Australia in 1994 and followed in 1996 by an automatic GTA version. With Australia still hauling itself painfully out of recession, half-million dollar Ferraris weren’t on the shopping list for even wealthy car buffs and hardly any 456s sold here. A decade later though, that situation had changed. The 456s that had been sold new in other right-hand drive markets were arriving locally as personal or dealer imports. No longer a $500,000 indulgence, these cars were landing at $140,000-180,000 and being offered by retailers at $200,000. Fast-forward 20 years and excellent examples of the 456GTA will struggle to make $150,000. Doesn’t matter that these are a very practical Ferrari with more power than a Testarossa plus some actual space inside. When buying a Ferrari, style is everything.

JAGUAR XKR 4.2S COUPE

PRICE NEW IN 2003: $209,000

PRICE NOW CONDITION 1: $52,000

Image: Jaguar

Two-door Jaguars from the 1960s and ’70s have finally achieved parity with their new-car prices and, at last report, XJS convertibles from the late 1980s are also getting back on to equal terms. Nobody, however, is rushing to spend $200,000 on an XK8 or XKR. Struggling under the yoke of Ford ownership, these Jaguars sacrificed character for durability, but even that didn’t work once reports began to surface of V8 engine failures. No such problems were experienced in 2003 when the new 4.2-litre supercharged V8 with 298kW appeared. Despite significant improvements, the revamped coupe had also barely moved in price; the 4.0-litre XK8 in 1998 costing $203,000 with the 4.2S in 2003 at $209,000. What didn’t change either was the pace at which depreciation cut into the V8 Jags’ retained value. By 2011, a 4.2-litre supercharged XKR coupe had plunged to less than $70,000. Five years later, the price of these cars in excellent condition had dipped below $60,000 and that is where the majority have stayed. Later XKRs suffer no endemic problems, but the need for maintenance is ongoing and costly. Then again, if you spend $30,000 on a mechanically neglected car and invest another $30,000 in repairs, the result will be a sound, reliable and relatively cheap Jaguar.

MASERATI COUPE GT

PRICE NEW IN 2004: $207,500

PRICE NOW CONDITION 1: $48,000

Image: Maserati

Maserati for many years stood in the shadow of Ferrari and Porsche before finding its niche. Maseratis built during recent years have found owners amongst people who like owning an exotic car but not to the extent of strapping on a helmet and fronting every other month at the club track day. Maserati’s GT Coupe, which arrived early in 2003, used a 4.2-litre V8 just like the XKR Jaguar but made its 287kW without help from a supercharger. GTs were a plush device, with everything visible inside being leather trimmed, front seats that were comfy but not clingy, and room for two more in the back. Standard as well were power windows, seats and mirrors, plus air-conditioning and a concert-hall music system. Maserati clearly weren’t worried by weight, which hit 1690kg. The new model obviously appealed to Maserati’s Australian ownership base, helping boost sales from 60 cars during 2003 to 107 by 2006. None of the above helped curb Maserati’s problems with value retention, which over a five-year finance term would struggle to achieve 30 per cent. By 2011, the wholesale value of a 2005 model had slumped to $70,000 and from there drifted slowly downward. Most Maserati GTs in the market won’t have seen much use and 20-year-old cars now typically show 45,000-60,000km while priced at $45,000-55,000.

PORSCHE 928GTS

PRICE NEW IN 1995: $241,711

PRICE NOW CONDITION 1: $105,000

Image: Porsche

Porsche is regarded as a brand that does a good job of protecting its devotees’ investment from rampant depreciation. Sadly, that doesn’t extend to the ones who bought a 928. The shark-nosed, front-engined coupe was by 1992 running a 257kW 5.4-litre V8 and its price had hit $230,000. Three years later when the 928 experiment was finally terminated, the cost of a new one had risen by another $11,000 and just 19 cars would be sold locally during that final year. Surviving 928GTS Porsches accordingly aren’t easy to find in the used market, but rewarding if you do. These are a properly luxurious GT, packed with gear that was lacking from early versions. The GTS isn’t a cheap car to keep either, as the owner filling one from a 98 Premium pump can attest. The tank takes 86 litres and just 500 kilometres of spirited driving will see it needing to be filled again. As an automotive experience though, the 928GTS has few rivals, especially in the region of $100,000. Unlike some in this group, low-kilometre examples are scarce, so be wary of high-priced cars that could soon need considerable sums spent on maintenance.

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