You’ve Got A Porsche To Sell,,,, Not An Investment Vehicle!,,,,,,,,,

A provocative title but an important attention grabber for my latest report on the specialist high performance used car market; following on from the recent article (link below) and coming as we all enjoy the Easter break.

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Wave Goodbye To Top Prices For Specialist And High Performance Cars!,,,,,,,

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Now I will immediately add the caveat that the market is becoming the most difficult to read and navigate since the one experienced leading up to and during the financial crisis; 2007 – 2009.

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By the very nature of what I do, I speak to a lot of people trying to sell their specialist high performance car, and with the peak of the market for prices now long gone, most owners looking to sell their car are now in danger of missing the market and the last opportunity to secure sensible offers. Before the ever increasing and inevitable lack of liquidity within the market leaves all but the finest examples struggling to secure offers; and with this in mind I thought I would leave you all with a market synopsis to consider over your Easter break.

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As much as the market is too difficult to read and assess for owners, it will result in most owners failing to secure sensible offers, and this will no doubt be due to two fatal flaws in their decision making process; greed and naivety. Whilst saying this though, I also appreciate that it is impossible for busy successful professionals to understand the workings of specialist markets so, to try and help, I thought I would advise on the evolution of market reality and the drivers effecting pricing; including what that will then mean for prices.

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In truth the sentiment contained within the title above could be applied to all the owners of specialist high performance cars, not just Porsches; the same disposal and trading challenges apply although they all have their own individual markets, within the market sector as a whole. I could’ve just as easily substituted Porsche for Lamborghini, McLaren, Bentley, Maserati, Aston Martin or included BMW M Power models, Audi RS Models and Mercedes AMG models.

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So why do I predict such a challenging market for owners trying to dispose of high performance specialist cars? Well, as much as I don’t want to repeat the content contained within the article above, (those interested can find the article on my Used Car Business Development Blog by following the embedded link), in reality there are two fundamental challenges; the market itself and the understandable lack of experience in the market by owners. So let’s start with the market, because as explored in greater detail in the previous article above, it’s very, very quiet!

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The market (and therefore prices) is driven by a lot of things but consumer confidence and sentiment drive markets at the retail end of the high performance specialist car market; supply and demand then drives prices. That said there are markets within markets, where factors like funding structures effect the ability to sell your car, therefore both saleability and pricing.

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So in isolation, let’s look at the Porsche market; one containing many individual markets; the new/nearly new market, the second hand market and the classic market. Ignoring the classic market for this article, let’s first look at the new/nearly new car market. With new car production still facing some challenges this has led to some Porsche retailers paying over the “Original” list price new for some under 2 year old cars. However I predict this window is closing as a lot of this stock (that purchased as long ago as August/September 2021) remains unsold within the Porsche retail network, thus reducing the networks ability to keep investing in further stock and more importantly, effecting stock investment confidence.

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So for the owners of up to 2 year old cars, especially 911’s and other desirable low production models; those 1 owner vehicles with high/unique?levels of specifications and low mileages, there still may be hope of securing the last of the “Silly Money,” but be quick; I predict that this will not last much beyond the Easter break.

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For traditional used cars though, the market is becoming a lot more challenging, with the “Perfect Storm” of negative market drivers forming over the market; all of which will affect the owners’ ability to sell their car, most of whom then fall into the trap of trying to retail the car themselves via platforms like Autotrader or Pistonheads.

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Now, as understandable as this thought process may be, this is a ridiculous strategy and notion, the reasons for which are so expansive, (so not for repeating here) but are all explored in the article below;

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A Public Service Announcement For The Owners Of High Performance And Specialist Cars!,,,,,

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In the article above I explored all reasons why, in reality, this process is flawed, but one thing making the sale of older high performance and specialist cars far more challenging, is the changing finance market.

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Competitive and creative funding structures play a pivotal role in the sale of specialist high performance cars; with the vast majority of purchases involving a funding structure that includes a deferred payment in the form of a guaranteed residual value/buyback value. What most would understand as a PCP or Personal Lease agreement.

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These funding structures/agreements are vital to the specialist high performance market as they bring increased levels of affordability to the expensive car market. However remove the deferred payment structure (the finance agreement involving a guaranteed residual value/buyback value) and the funding landscape changes dramatically; with the cost of acquiring a vehicle increasing substantially.

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In the last two months, and since writing my previous article, it has been interesting to see how many finance companies are now removing these funding structures for older cars and this further effects the market, making selling the stock involved considerably harder; which can only be “Hedged Against” and overcome by offering this profile of stock at far lower retail prices.

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So if this is an abridged summary of the market challenges, let’s explore some of the personality traits conspiring to stop owners from being able to dispose of their cars. In the main there is a lot of misplaced hubris bordering on arrogance when it comes to many owners, many of whom completely overestimate what it is they have for sale. Too many think they have bought an investment; the vast majority haven’t, what they have for sale is a premium product that depreciates at a slower rate, but one that has very few routes for disposal.

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Most like to also forget the price of reconditioning and preparing cars of this ilk for sale; it is an inconvenient truth that the costs of running, servicing and preparing these cars for retail is extortionate. Yet all this gets forgotten in the mind-set of the vast majority of owners looking to sell their specialist high performance car, because their car is different, the best available and not effected by market forces.

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I could go on but I won’t, I will just recommend that all those with a specialist high performance car to sell, (those with it currently up for sale on Autotrader and/or Pistonheads and wondering why the phone isn’t ringing), take a moment to look beyond their car and look upon it as being no different to a Mars Bar; a commodity that has a value.

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For most reading this, the decision is one of whether to take the money today or waiting for prices to recover from the correction that is coming. Now predicting prices 12 months hence is difficult; in truth I don’t get involved, but one thing I do know is that price corrections are expensive and not gradual affairs.

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When you enter a market with little stock investment liquidity and low consumer confidence, (as we are now), only the finest most unique examples tend to find competition for purchase, thus sensible offers. For the rest the onus is on you to convince those with cash to spend that yours is the car they should be buying, which is possible, but you only have one thing to offer; a car at a price!

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In market conditions like this prices don’t correct by small margins, they correct by 10 – 20% from their previous high; and that is for the best stock, many will struggle to find offers at all. For many reading this article, those not needing to sell their car, they can afford to gamble and look to return to the market when it has stabilised at it’s new level; probably in 12 months’ time.

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For those needing to sell the picture is very different and my advice is to get ahead of both the depreciation curve and market sentiment whilst you can. This will not be palatable and/or enjoyable but if you need the money, take it now; the first offer will always be the best offer and with the market evolving as it is, procrastination will cost you ￡Thousands.

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So with liquidity in used car markets running out, where to turn now for the owners of specialist high performances cars; those looking for the right expertise and experience? That required to facilitate in the immediate liquidation of their car; a process requiring skill, expertise, the utmost discretion and excellence in execution?

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Well with funds available for immediate purchase and unrivalled experience in liquidating specialist high performance cars, including the contacts base within the professional community, (both franchised dealers and the most knowledgeable specialists), you could contact me for a market consultation.

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As much as I am not going to promise you for one moment that I work with every car that is offered, or with every owner that contacts me, I do choose to advise and help everyone who contacts me. In reality I can only work actively with 10% of the owners who contact me; and their associated cars.

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Offering immediate cash purchase, (should circumstances dictate), or the facility to act as your trusted conduit to the market, returning the best prices, I am the ultimate solution provider for those looking to dispose of their specialist high performance car.

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Please feel free to reach out to me directly on LinkedIn, via email at [email protected] or on 07500 321539; should you wish to arrange a consultation call.

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Happy Easter everyone,,,,,,,

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Andrew.