When to Buy a 'New' Car

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Originally Published: 1/1/2000
Mitch Silver

Of all the questions I get asked about cars, the easiest one to answer is: ""What new car can I buy that will become a collector car?""

The motivation behind this question is always financial. The dream is to buy a new car with all its conveniences, discount financing and that crisp new-car smell, then have it appreciate like a '57 Thunderbird or'53 Corvette.

The reality is that these cars depreciate significantly before they appreciate. The tragedy is that many buyers pay incredible premiums to be the first owner of some limited production cars.

Some of the recent disappointments have been the ZR-1 Corvette, which initially changed hands in the $70-$80,000 range. A few months later it was $40,000, and now new examples sell in the low $30s.

The Chrysler TC by Maserati was offered by Chrysler at $40,000 plus. I'm now selling conservatively used examples for $15,000 to $18,000. Cadillac Allantes went out the door new for $50,000, but earlier used examples now run in the $15,000 to $20,000 range.

The 1978 Corvette silver anniversary model sold new for $16,000. But you could find one of those examples, with zero miles, today for $20,000 - minor appreciation indeed for a 15-year investment.

The list goes on… 1976 Cadillac Eldorado convertibles sold new for $16,000. With low miles, they are now worth $12,000 to $15,000.

Even the Mazda Miata, widely expected to become a collectible car (and it probably will be), isn't immune. They've held their value well, but a used Miata is still worth less than a new Miata.

I'm not criticizing these cars. Quite the opposite. These cars are excellent buys now - but they weren't great buys new.

The Allante, for example, offers power, luxury and an Italian body at a used-car price that is hard to believe: How can a $50,000 car depreciate $33,000 in six years?

My guess, however, is that most of that depreciation is over. Buy an Allante now or any of the other cars that I've mentioned, and you'll own a great car that's probably going to hold its value and might even start rising in price.

Automobile manufacturers will continue to build future collectibles. When then they have a winner, those cars will command a premium price and buyers will stand in line to have the first of anything.

My advice is to wait a year. Wait five years. Then these cars will be yours for the buying at bargain prices.

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