Dean and Beverly Avery gaze at their 1966 Ford Mustang coupe Monday, Sept. 20, 2004, in San Leandro, Calif. Baby boomers longing to buy the autos they coveted but couldn't afford in their youth are driving a surge in the classic car market.
AP Photo/Ben Margot
NEW YORK (AP) Dean Avery recalls being awestruck when his mother's date picked her up in a 1965 blue fastback Mustang. Avery, 11 or 12 at the time, thought the car and its sloping back window were cool.
''I'd never seen anything like it before,'' he said. ''It was so eye catching.''
Avery, now 49, couldn't afford one until four years ago, when he bought a 1966 Mustang for his wife. Two years ago, he purchased a 1967 for himself.
Baby boomers ranging from age 40 to 58 are driving a surge in the classic car market, buying the cars they couldn't purchase when they were younger. Muscle cars such as Mustangs, GTOs and Cameros are among the automobiles propelling the market, said Graig Jackson, president of Barrett-Jackson Auction Co., in Scottsdale, Ariz., the country's largest car caution house. Sports cars and street rods are also popular.
''These cars just bring you back to your youth,'' said Avery, a sales manager for an industrial company who lives in San Leandro, Calif.
Many of these cars command prices well into five or even six figures. Jackson said a 1969 Camero ZL1 would fetch between $550,000 to 750,000, up from $250,000 two years ago. A 1965 Shelby 3TG50 Mustang would command $110,000 to $120,000, up from $55,000 in 2002.
''You are seeing a lot people who worked their whole life now making age old dreams a reality,'' Jackson said. ''People's money is doing nothing in the stock market. At least they can enjoy the cars.''
Still, Jackson said most people buy vintage cars not as an investment, but for fun. He said 40 percent of buyers at his company's big annual auction in January were first-timers.
This year, sales at the auction reached $38.5 million, up 35 percent from 2003 and 13 percent from 2002.
''Classic cars are like a recreational property,'' said Keith Martin, publisher of Sports Car Market Magazine. ''Old cars are not good for daily transport. They have no air bags, no air conditioning, terrible brakes.''
The nostalgia for old cars is fueling the growth of related businesses. Last year, Hemmings Publications launched Hemmings Muscle Machines, a companion to its existing publication on collectible cars.
And three years ago Douglas Hasty founded Unique Performance, a company that takes old Mustangs from the 1960s and retools them into Shelby Mustangs, one of the iconic cars of the 1960s. Carroll Shelby was a legendary driver and car designer who refashioned Mustangs with bigger engines, lighter frames, better breaks and smoother handling. The new versions of his cost between $99,000 and $198,000. They've become so popular with boomers that Unique is going to begin selling retooled Plymouth Baracudas and Chevy Cameros next year.
''We take the cars from the '60s, strip them and give them the latest technology,'' said Douglas Hasty, president of Unique.
Shelby was also behind the design of the Ford Cobra, a popular sports car from the 1960s, and is talking with Ford about bringing out a new version of the car. Meanwhile, Shelby has been making replicas of '60s vehicles for about a decade and they've proven very popular with collectors who don't want to spend splurge for an original.
Two years ago, dentist Ted Glover bought a replica of a 1965 Cobra for $120,000 because he couldn't justify the $300,000 to $400,000 price of an original. There are just too many other autos he wants to add his collection of 36 cars, which includes a 1970 Hemi 'Cuda.
Glover, 53, has been collecting cars since he was in dental school, and still has the first car he ever bought, a 1972 Panterra, Ford's answer to the Corvette. He paid $8,000 for the Panterra in 1976, and it's now worth about $40,000. He said he could never sell it because he used it to drive a cute girl home from a party the woman who is now his wife.
Glover said he has spent between $500,000 and $1 million on his cars but estimates they are worth about $1.2 million. Still, while many of his cars have appreciated in value more than his stock market and real estate holdings, he doesn't see them as an investment.
''It's not just a car. It's more of an emotional attachment,'' Glover said.
Insurance agent Jim Jones agrees that classic cars are more than an investment although he has made money selling classic Mustangs. He's found that the cars have become part of his social life Jones and his wife started a car club in 1989 that has become an avenue for meeting new people and raising money for charity.
''For us it all about the people,'' Jones said. ''You start talking about your '68 Mustang and all the social barriers drop. The guy who spent all is money on the '68 and the millionaire are talking about the same thing.''
Jones has longed for a 1965 Shelby GT350 Mustang since 1977. He currently has a 1966 Shelby, but his dream car may have to wait.
''My wife says $90,000 is too much to spend,'' he said.
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