Government promotes classic car exports encouraging collectors
View(s):The Government is promoting the classic car collection and finding export market for such vehicles as it has now become the best performing assets in US and European markets, official sources said.
The State Ministry of Transport Services has already taken measures to promote classic car exports finding better markets for owners of such vehicles.
A classic car is no longer just a fancy collectible for display in a random millionaire’s garage. Instead, it has become part of the long-term strategies of many investors around the world.
The global classic car market reached nearly US$25 billion dollars in 2019 and is expected to grow by 8.2 per cent annually until 2023, motor industry sources revealed.
The market for classic cars and motorcycles has done better than all other investments like bank deposits, art, coins and stamps over the past decade and has also overtaken many stock index gains across the world, a pioneer in the vintage car collection said.
He told the Business Times that although car collecting is believed to be the hobby of the super rich many orthodox investors have made money by investing in a couple of cars.
The car market is an investment one enjoys aesthetically and it can also provide a currency hedge since vehicles can be transported to countries where the maximum value can be released.
Motorcycles surpass cars in this context as they are more transportable and do not have the left hand or right hand drive restriction, he added.
In Sri Lanka the classic car market has seen a steep rise in the past few years. Analysts are of the view that an average 10 per cent p.a. rise was seen from 2010 to 2015 and a 15 per cent p.a. rise since 2016.
“A VW beetle 1300 that was fetching Rs. 500,000 a few years ago can easily fetch a million rupees if the car is in original condition,” says Herbert Perera, an enthusiast cum collector.
“The older cars now go for over two million. We see the same price increases in almost every mode,” he said.
The rarer cars like MGs, Humber, Jaguars etc are, all are snapped up by collectors at steep prices.
The condition of the classic car makes a big difference to the price as restoration is prohibitively expensive. Original cars in good running condition can go at a 50 per cent premium over a badly maintained car, he explained.
“Collecting cars is not for everyone. First you need to have the passion and the knowledge. The buyer will need to pick the correct investments. Cars will move up in price due to its rarity, uniqueness or originality,” he said. (BS)