I just got back from my annual pilgrimage to the Concours d’Elegance at Amelia Island. What makes this show so special? Aside from an eclectic collection of prime historical vehicles, some of which are restored to a condition far superior to when they were new, this show is devoted largely to former racing vehicles, most of which are still being actively campaigned in various historic races around the country.
This year the Ferrari 250 GTO was the featured marque. For those who may not be aware of these exceptional vehicles, there were only 36 built as pure racecars to compete against the Cobras which were just coming onto the racing scene in the ‘60s, 12 of them were on display at a cost I can’t even guess at anymore since they never show up for public sale (I’m told they go for around $30M each.)
In addition to the show there are two auctions where people who seem to have more money than common sense sometimes bid on old race and/or production vehicles with seeming disregard to the current value, at least that’s what it looks like to the unsuspecting spectator. The reality is that these vehicles are an investment, albeit speculative at times. But, not all fit this description. In addition to the Ferraris, Astons, Bugattis, Jaguars, Bentleys, and the like, there were a selection of unusual machines that only an aficionado could love such as Amphicars and GoGo Mobiles. What drives the prices up on these? The cost of restoration and maintenance.
Where am I going with this? In our retail lives we are seeing more and more older vehicles which people are keeping on the road long after they would have been scrapped just a few years ago. In some cases it’s economics, but in others it is an attachment to that vehicle for sentimental reasons (first car/parents’ car). Mazda dealers can tell you stories about early RX-7 owners who will install a new engine in a clapped out chassis, and ditto for early ‘Z’ owners. The point here is that the decision to repair or scrap is not always one of economics. These are opportunities that we need to be prepared for.
Qualify your customers!
Years ago we would write off an older vehicle as “not worth repairing.” That’s not necessarily true anymore. That decision is the owners’, not the ASMs. We need to spend more time with the owner and the vehicle.
- What condition is the unit in? Does it look like it’s been kept up? Is it clean or a trash heap?
- What are the owners’ intentions? Don’t assume. Ask!
- What are the owners’ financial limitations? This will help to write the “Prescription.”
Write the prescription
Based on the qualification process, assemble the steps necessary to complete the repairs. Prioritize the steps based on:
- Safety: Brakes, tires and suspension work usually fall into this category.
- Reliability: Maintenance and component service (transmission/axles).
- Protecting the investment: Appearance and long term maintenance.
Set the expectations
This is where I got an earful from the restoration pro’s that were in the audience (yes they were at the auctions ready to drum up business from the new investors):
- First, establish a commitment for the project. This may require a contract similar to what collision centers use.
- Second, establish a timeline for the project. Include both the start and the finish.
- Third, develop a budget for the project, including the payment structure. Many restoration pro’s take periodic payments and move the job forward only after they have collected enough to cover their investment in parts and labor.
- Fourth, agree on the finished condition of the vehicle. Many restorations have gone foul because the owner had higher expectations of the final product than the shop was willing or able to produce for the agreed price. Make sure everyone is clear on what the end product will look like and how it will perform.
This is going to be a small portion of the business that a dealer does since much of this work will go to the aftermarket, but there’s no reason why a dealership can’t do this kind of work, especially considering the expense of training and maintaining technicians and the rising prevalence of maintenance over repair work. Besides, wouldn’t you like to see your handiwork carrying the Homecoming Queen around town this fall? It makes for great promotional points.