Fear & Loathing The Classic Car Dealer: Part 2
Back in 2011, I made a lot of enemies with an article that I sharpened to a spear point and then thrust into the belly of the classic car dealer. You can read the original here. To this day, I still get emails from seething dealers that have stumbled upon the piece for the first time. It’s become a sort of wicked pastime of my mine to answer their insults with smiles and grins. They hate me… almost as much as I despise their business.
My main beef with the classic car dealer remains the same. I hold no value for a middle man in this game of ours and would like nothing more than to see them extinct. They aren’t worthless. No… They are worse than that. They take away from this thing we love by removing cash from our ecosystem without adding any value what-so-ever. They are leaches.
There are exceptions of course. In fact, we actually host a few dealers on the H.A.M.B… But these guys aren’t parasites deriving nutrients at the host’s expense. Instead, they ad value to our ecosystem by finding rare examples, improving them, and ONLY then offering them back into the market at fair and reasonable prices. It’s a thankless job in a market full of swindlers and charlatans, but there still are a few left willing to endure it all. Hell, I even tip my hat those guys.
In fact, it was one of these honorable dealers (Man, we gotta get these guys a better label) that lead me to breaking off my new years vacation a little early and posting today. See, he was scanning the HAMB classifieds and ran into this ad. It looks like a decent ’36 coupe for a good price, right? A little work here and there and my dealer buddy could introduce it back into the market at just as good or better of a value. So, he inquires…
It turns out the car originally belonged to the seller’s “pawpaw” and that he really wanted it to go to a good home. It’s in perfect shape and ready to go win some trophies! Of course, the car has a lot of sentimental value too – right?
Bullshit. It’s all bullshit.
There is no “pawpaw.” There are no trophies. There is no sentimental value. Instead there’s a lie… a con… a story tugging at the emotional strings of the buyer and a liar hoping like hell to turn all of that bullshit into currency. It didn’t take long for my buddy to find this. It’s the same ad, using the same photos of the same car, promoting a price that is $5k cheaper than what was posted on the HAMB.
So who is the seller? Is he just a con man? Or is he a minion for the dealer? He now describes himself as a “broker” and claims the car could be bought from the dealer for just $19k. So, lets break this down a bit…
Let’s assume that the car could be bought from the dealer for $19k. So, it’s fairly safe to assume that the dealer has far less than $19k in the car. For arguments sake, lets be really conservative and assume they have $15k in it. That would leave the dealer with a profit margin of around $4k after the sale. In other words, they are grabbing $4k from our market without adding ANY value to it at all. That’s $4k that could have been spent elsewhere in the economy on things like tires, upholstery, parts, etc… You know, the stuff supplied by the companies and working people that actually power our industry.
And what about the broker? He had the car priced at $26,500! That’s over $11k in margin! Forget the economy of classic cars for a moment. Forget the folks that actually enable this world of ours to exist. Replace those notions with the original seller of this ’36 and the end-game buyer – the guy that will eventually end up with the car in his garage. Given the current situation, the original seller sold the car to the dealer for $15k. And worst case, the end-game buyer bought the car from our “broker” for $26,500. You can also look at this $11,500 margin as money that could have been split by these two… So, the seller could have gotten almost $6,000 more for their car and the end-buyer could have gotten the car for almost $6,000 less if it were not for the classic car dealer industry.
Think about that for a while… and maybe, just maybe you’ll end up hating classic car dealers as much as I do.
Special thanks to, ironically enough, a classic car dealer… one of the good ones that actually does things the right way. If it weren’t for him I wouldn’t have had such a tangible example to work from.
Editor’s Note: The Jalopy Journal will go back to its regular editorial schedule on Tuesday – January 3.