Aston Martin's Return to Le Mans and Its Potential Impact on Classic Car Investments
From Le Mans to Silverstone, the French city holds a special place in the motorsport world. The first French Grand Prix took place there in 1906, and this Northwestern town on the Sarthe River has a history that dates back before the Romans arrived in 47 BC. Henry II, the Plantagenet King of England, was born in Le Mans, in the year 1133, to Geoffrey V of Anjou and Matilda of England, the child of Henry I and the fourth son of William the Conqueror. Matilda married in Le Mans Cathedral on June 17, 1128.
Fast forward almost 900 years, and Le Mans is synonymous with being home to the oldest active endurance racing event in the world, the legendary 24 Hours of Le Mans. This epic race began in 1923 and forms part of the Triple Crown of Motorsport, a prestigious distinction shared with the Monaco Grand Prix and the Indianapolis 500. Unlike the other two races that focus on speed, Le Mans is won by the car that covers the greatest distance in 24 hours. The focus here is on reliability, with cars running at speeds up to 250mph, completing lap after lap, minimizing time spent in the pits. The race is organized by the Automobile Club de l'Ouest and since 2012 has been part of the FIA World Endurance Championship (WEC).
This year's event promises to be particularly exciting for British fans, as Aston Martin aims to win for the first time since Roy Salvadori and Carroll Shelby took their DBR1/300 across the finish line in 1959. The company's Valkyrie is a classic, purebred V12, designed by Englishman Adrian Newey, one of the most accomplished automotive designers. Should the Valkyrie win on June 14, it would cement Aston Martin alongside Bentley as a perennial British motorsport brand. Bentley has won Le Mans six times, including an incredible run from 1927-1930, when it was unbeaten, earning the expression 'The Bentley Boys,' referring to the British motorists who drove the cars to victory.
The Valkyrie's engine is built by Cosworth, a partnership between Mike Costin and Keith Duckworth, who met at Colin Chapman's Lotus Engineering in 1958, the year preceding Aston Martin's last Le Mans victory. The car will be driven by a British crew of Harry Ticknell, Tom Gamble, and Ross Gunn, and carry the highly appropriate race number 007. However, competition will be fierce, with Ferrari chasing a hat-trick, Porsche eyeing a phenomenal 20th win (citing their reputation for reliability), and French teams like Peugeot and Alpine eager to secure victory on home soil (the last French win was in 2009). Mercedes has also returned to the fray after a 25-year absence, and British Racing Team Jota Sport has teamed up with deep-pocketed Cadillac to enter no less than four cars. This year's race is guaranteed to provide excitement.
The Allure of Aston Martin
Aston Martin, founded by Lionel Martin and Robert Bamford in 1913, has a rich heritage in motorsport and performance, as well as a strong association with British royalty and, of course, James Bond. The marque's impressive lineage at Le Mans has attracted the attention of investors. The 1959 triumph of the DBR1, one of only five ever made, culminated in a single chassis fetching an eye-watering $22.6 million at RM Sotheby's auction in 2017, demonstrating the brand's enduring appeal.
Should the Valkyrie claim the victory this weekend, the ripple effect could elevate the value of Aston's classic cars. The DB5, entwined with Bond since Goldfinger and arguably the most famous car in cinematic history, commands around $1 million in top condition. However, those with documented racing provenance may soar well into seven figures. Rarer still is the 1961 DB4 GT Zagato, one of only 19 ever made, which sold for a massive £10 million at the Goodwood Festival of Speed Bonham's auction in 2018, reflecting a tenfold increase from its one-million-dollar valuation in 2000.
Classic Cars and the S&P 500: A Study in Returns
Do classic cars consistently outshine the steady advance of the stock market? Evidence suggests they can, albeit with volatility. According to the Knight Frank Luxury Investment Index, classic cars yielded a 10% annual return from 2010-2020, outpacing the more modest seven to eight percent returns of the S&P 500. Consider the 1962 Ferrari 250 GTO, purchased for $1.5 million in 1990 and selling for a staggering $48 million in 2018, recording a 30-fold return that eclipsed the S&P's sixfold growth over that period. Similarly, the aforementioned Aston Martin DB4 GT Zagato, acquired for a million dollars in 2000, now commands a tenfold gain of $10 million, well surpassing the S&P's threefold rise.
However, potential investors should not expect a smooth road. A regular Aston DB6 may only shadow the S&P returns, particularly when accounting for annual maintenance costs of up to $10,000 for storage, insurance, and restoration. Liquidity is further complex, as stocks can be sold instantly, while classic cars may remain unsold for several months. A Valkyrie victory this year could boost the value of a DB5, much like Ferrari's hat-trick would only enhance the allure of a 250 GTO.
The Road Ahead
If you're new to the pursuit, diligence is paramount. Rarity is crucial – the fewer there are, the more sought after they are likely to be. Condition is critical, with vehicles featuring original components, unmarred by corrosion, and accompanied by meticulous maintenance records commanding premiums. Provenance can elevate a car's worth exponentially. The 1955 Mercedes-Benz 300 SLR, known as the "Uhlenhaut Coupe," sold for an astounding $142 million in 2022, setting the record for the priciest car of all time. The auction houses, Bonhams and RM Sotheby's, provide a glimpse into the current market. A well-preserved DB5 may be bought for $500,000, while the more accessible DB7, Aston's gateway classic, might be found around $50,000.
Ownership is not without its tolls: restoration insurance and storage soon add up, and unlike company shares, classic cars are illiquid. Classic car investing is all about the joys of ownership and immersing oneself in the culture. An investment in passion could prove both profitable and purposeful.
- Le Mans' rich history extends beyond motorsport, with roots dating back to Roman times and the birth of King Henry II in 1133.
- This year, Aston Martin aims to win the 24 Hours of Le Mans for the first time since 1959, adding to its reputation in British motorsport.
- The Valkyrie, designed by Adrian Newey, will be driven by a British crew and carry the race number 007, reflecting Aston Martin's strong association with British royalty and James Bond.
- Competition is fierce, with Ferrari, Porsche, Peugeot, Alpine, Mercedes, and British Racing Team Jota Sport entering multiple cars.
- Aston Martin's classic cars, such as the DB5 and 1961 DB4 GT Zagato, have seen significant appreciation in value, making them attractive investments for enthusiasts.
- Classic cars as an investment can yield higher returns than the S&P 500, with evidence suggesting a 10% annual return from 2010-2020, but require diligence and careful consideration of factors like rarity, condition, provenance, and liquidity.
