Classic cars are prestigious, classy and exciting. A $16.3m Ferrari 250 Testa Rossa, an $11m Ford GT40, a $3.7m Jaguar C-Type and a $3.7m Aston Martin DB3S – just some of the expensively priced vintage models sold at auction in the last two years. 

With no capital gains tax and returns of up to 395 per cent for some more prestigious models over the last ten years, it appears that classic cars are being taken seriously as a fun investment with potentially lucrative returns. 

Nick Goldthorp, Managing Director of Jaguar restoration specialist Classic Motor Cars, believes classic cars should not be looked upon as an investment. 

“It’s not the way to do it,” he said. “We never buy something to restore on-spec. All our restoration is done to order, a specific order by a client because to do it properly you always end up spending more on the car than its actual value. But when we restore a car for a client, they’re not doing it to have it restored and then sell. Most of our clients hang on to their cars for ten, 15, 20 years. We’re still servicing cars that we built 20 years ago for the same people.”

Nick’s company, Classic Motor Cars, was recently asked by a client to restore a very special Jaguar E-Type, the 60th ever built.

“A client of ours bought the car and asked us to restore it,” he said. “I went down and inspected it for him on the Saturday before the auction and gave him my report. He set a budget after discussing it with me. And then when I called him on the way to the auction on Monday he said ‘I’ve thought about it, I’m now going to go to a maximum of £85,000 on the car’. I said ‘wow, that’s a lot of money. You should get it at that’. 

“And then he called me at five o’clock to say, ‘you know that car, it went for more than £85,000’. I said ‘oh, that’s disappointing’. He said it went for ‘£96,000 plus the premium’. I said ‘well, you gave it your best shot, never mind’. 

“And then he said, ‘well, you better arrange to collect it because I bought it’. He went a lot further than he originally intended to but he wanted the car.”

THE GREATEST FACTORS AFFECTING THE VALUE OF JAGUAR E-TYPES

Rarity, provenance and history are some of the key factors affecting a classic car’s value, as Nick explains.

“The historic factor – obviously the ones that the collectors want will always be at a premium. Like all these very expensive cars, it’s the provenance and the history and making sure that the chassis number and the engine number and the body number and the gearbox number all match, as they were when it left Jaguar. 

“Or it could involve a racing type car like some of the late Jaguar E-Types that have been raced and damaged and crashed and had engines changes. As long as you’ve got the history of the car and what happened when and where, it’s not so important that it still has its original gearbox or original engine.”

As soon as one drives a modern car off the garage forecourt, its value plummets by 40 per cent – something unheard of in the rare classic car world.  

“As long as it’s documented through its racing career, that’s fine. It’s all about the provenance and the history and the documentation that goes with the historic cars.

“There aren’t many historic cars like Chassis No. 60, I think at the end of the day, even though it cost over £100,000, by the time it’s restored, the owner will still have a car that’s probably worth more than the cost of the restoration and the cost of the purchase.

“That a historic early car. If you’re restoring a run-of-the-mill production E-Type the restoration costs do end up being more than the actual vehicle is worth at the end of the day.”

Only gold has provided a better return than classic cars – 434 per cent – over the last ten years. 

In April alone, Historic Automobile Group International – which monitors the sales of certain models – showed the value of the top 50 classic car market was up 8.55 per cent.

“All our customers are enthusiasts and they want the cars restored because they love the cars really. That’s what it’s all about at the end of the day. 

“We don’t want people buying cars to speculate, trying to make money on them, because ultimately the market gets over-inflated, overheats and then sooner or later the bubble bursts and then we’re all losing then.”

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