This last month has been brutal for the car market, between two of the largest car markets being hit by hurricanes and one of which remains under water, the industry as a whole will surely suffer.
That said, this week I have two very important messages to share.
- Be aware of cars that will be priced aggressively with a history of Houston Texas and/or Miami, Florida on their records during these last two hurricanes. Keep in mind that not all cars originating from there are bad or flooded, but it is important to pay close attention to any possible water damage during a good PPI so that you do not fall victim to some of the tricks that will start post these storms.
- Dealers in those areas have lost weeks of sales and opportunities so expect good opportunities for lower prices on clean inventory but also expect slower delivery times of cars that need to be picked up in or out of those areas. There is going to be a lot of dealers trying to move inventory for many reasons including giving themselves room to re arrange or work out their inventory.
The State Of The Car Market After Hurricane Harvey and Hurricane Irma
Overall brutal weather in key areas or so called exotic car hubs like (Florida, CA, and TX) will cause massive pain in the overall car world including higher insurance prices nationwide due to an increase in spending by insurance agencies to cover auto and homes that have been damaged all over.
Outside of basis storm issues, the market as a whole seems to be doing well but certain models seem to have been recently taking a few hits. This means there is a chance for some stability but there is an also higher risk that the volatility works against you if you do not buy right.
What Cars To Focus On Right Now?
Mercedes SLS: The market feel over 40K on most models in retail and wholesale levels and while some dealers are holding on to their prices, 2011 cars used to sell for 140 to 150k but now are widely available under 130K for. While 2012 used to retail around 175K and are now trending in the 150K all day long. This volatility could continue downwards but I do not believe it will, on the contrary with this particular car, I believe that we will see increases rather than decreases. Part of these drops are related to Mercedes making a press statement that it will not have a solution to 3 separate recalls issued on the SLS that has yet to have a real resolution.
The Dodge Viper SRT: 2013 marked the first year of the last generation viper and it was recently announced that the 2017 models will be the end of the production for the iconic American muscle car. While I was never a fan of the Viper as a car due to its brute uncontrollable power, and complete plastic interior. The new car is very different with a good quality interior (built by Ferrari) and more suspension upgrades and traction control add ons that make this latest model still too powerful but somewhat useable in a safe manner.
The car is impressive and despite 2013 cars having recalls for oil issues that led to massive engine failures, their following makes them an incredible opportunity for people who seek an incredible looking car for basic Mercedes E class money. Most of the 13, 14 and 15 can now be picked up sub 78K and are an incredible bang for the buck. Furthermore, we have seen an increase in demand leading to stronger asking prices and less wholesale examples. I particularly like the GTS 2014 or 2015 as the ideal car to buy, hold, enjoy and resale in a few years.
The Lamborghini Huracan: Many of you emailed asking me if it’s a good time to get a Lamborghini Huracan and the simple answer is NO. The Huracan both in Spyder and Coupe form are still acting too weird for my taste and honestly too many dangers are lurking for such cars.
The first being that 2015 cars are going to be out of warranty soon, dragging cars down in the 160K, followed by the fact that Spyders are coming down hard, driving the coupes even further down the drain.
The last issue with Huracans is the increasing amount of high mileage cars entering the market and 24-month lease returns around the block. All of this plus Lamborghini announcing higher numbers of production for next year leads to too much extra inventory and too little demand to match, which usually means cars are going down.
BUT there is an interesting angle on this specific car because we have still seen the low mileage cars with specific exciting colors bringing a premium despite this. For this reason, I cannot endorse the car currently as a good car to buy.
The Mclaren 650S, 570S, and MP4: MP4 cars have been dropping and will continue to as more and more cars are leaving the CPO programs and running out of warranty with users knowing they are plagued with issues everywhere.The 650s hasn’t suffered yet but seen a slight dip due to the expectation that 720S will drive these cars down. Since they were already down, it will be hard to see such values dropping below the 180K line on a consistent basis. Nonetheless, the threat is there so buy as close to this as you can if you want to minimize your losses. The 570s has come back up from its previous dip and allowed the 570GT to create a weird place for itself in the 160-175K range and doesn’t look like its moving. The 570S can still be picked up for 2016 and 2017 years under $190K for low option cars, and around $200K for highly equipped cars. Colors also matter a lot with the McLaren cars, so expect to pay more for desirable colors and options.
Be careful of the 570s and 570GT in the next 6 to 8 months as more models will flood the market with the release of the 570S Spyder. A car that is only $20K away in MSRP to the coupe version. While cars will not be readily available quickly, people will trade their coupes, increasing the supply for a short time frame and again 12 months later as Spyder values plummet down 50-70K below sticker.
The Aston Martin market: Despite my previous belief that there is a huge demand for the right Aston Martin, it seems from my perspective today that there is only a demand up to a certain price point, no different than Maserati.The Vantage V12S and 7-speed manual were a huge flop with dealers offering as much as 70K off MSRP already. The Vanquish market has seen a HUGE loss due to the release of the DB11 (which has not done too well either) but also is the new platform for the new DB11S. That said, the Vanquish cars will move for a price much close to wholesale than previously expected. The DBS, on the other hand, continues to do well for manual cars and not so well for automatics. 6-speed cars are holding in the $110K and selling strong and quick, versus automatics are doing better as bargain cars than high demand cars. I recommend finding a 2009 to 2011 DBS 6 speed if Aston Martins seem to catch your attention. Unless of course you still seek a more affordable 6-speed car, then the 2009 Vantage 6 speed is your best bet.
There you have it, my monthly overview on the car market and what to expect this month for the exotic market. Remember to keep your emotions out of the game and your knowledge of the market and various makes and models strong. Don’t forget to use all the strategies I teach you as an insider to be able to drive the exotic car of your dreams completely free.