Poor resale value

[offroadkarter]

The only car I ever made a profit on was an American one, helped by their rarity over here in the UK.

It was a 2001 Mercury Grand Marquis in brilliant condition with only 36,000 miles on the clock.

I bought it a couple of years ago for £3,200. Ran it for 8 months then sold it, when Ford UK announced the S550 prices, for £4,500.

That was free motoring for 8 months, incl fuel and insurance, even at 12 mpg with petrol at 8 dollars a gallon.

I want to meet the kind of person who wants to own a 2001 grand marquis in the UK.

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[GGordon]

Aftermarket mods do not add too much value. Maybe 30% of the parts value unless it is highend parts, but even then.

I disagree, rather pointedly. It makes a difference as to what aftermarket parts you're talking about. Now, here's a simple fact for you: A lot of Mustang owners are "lookie-see, lookie-do" types. They all see something someone has and do it to theirs. That's why so many people end up with the same Borla, Flowmaster, or Magnaflow exhausts... same spoilers, same wheel/tire combos, same intakes and tuners. MOST Mustang drivers also do exactly those: Exhaust, rear deck spoiler, intake and some big spenders jump for wheels. That's probably 90% of people who splurge on aftermarket parts on a new car. If a driver only does the standard upgrades... true. Nothing special and almost no value is added (except maybe for the wheels/tires). Anything NA under the hood = no value on trade ins and most will also harm it on private sell... because most people aren't dumb and don't want a used Mustang that's been obviously tweaked.

Now, how does one actually make money in the custom market? Uniqueness. Originality. High quality.

Changing the hood, running boards, front/rear fascia, and interior appointments actually do hold very good value so long as the installation and fitment are absolutely perfect. Custom wraps and custom paint also increase the value given quality. The majority of buyers who buy used sports cars are not gearheads. If they were, they would want a cheap base to build off of and save money. Thus, most people are going to be pedestrian in their knowledge and your car has to appeal to them. Thus, visual mods sell to dealers (who resell to these people) and private buyers. Still, these are all very common still... and a few visual upgrades can raise the value above parts cost if they are done very well.

Now, how do you actually profit?

Themes. Too many times people part together a bunch of parts and it looks cliche or quite simply, like a hot mess. Some people might like a yellow Mustang with red metallic wheels... but 99% of people won't. Conversely, take an Oxford White GT and get a top quality "Austin Powers" style American flag sprayed onto the car... and wham, you're now an attractive absolute one-of-a-kind that will sell at a good rate to a Veteran or anyone with a bit of patriotism running through their veins.

Going along with the theme, when you decide to modify... doing all the mods with a plan helps. The worst thing you can do is buy 2 mods, wait 6 months, buy another... then start impulse buying out of catalogs as something shiny catches your eye. That's how you create hot messes. Creating a unique car is no different than painting an oil on canvas or writing a novel. Authors generally don't write something, drop it, then come back 2 years later to finish it. That's because the continuity of the work will have issues. Car builds are the same. If you have an idea and start something, if you quit partway through and change design ideas... yeah. No bueno.

That's why it is important to render your build ahead of time and STICK TO IT. Build it as quick as possible... or not at all in my opinion (if you are building to resale). Make sure the visual mods are not the number one selling items on a site's list... mainly because everyone has one and if you start replicating what others have done, then you're not adding any value (looking at you, Le Mans stripes. Looks nice, but 0 value added). To bring big bucks, you have to be original, unique, and complete.

Part of "complete" is functional mods. You don't see stock 2016 GTs with a stuck on Roush hood scoop rolling across the auction at Barrett Jackson. No, the good cars are full builds. They are visually unique, but then they're mechanically special. Some may have turbos, aftermarket blowers, engine swaps, engine dress ups... handling and control parts. All well and good to have these things... but if you don't document every install, they offer no value. Unless you're a certified mechanic and/or a known subject matter expert, if you don't document the installs with paperwork (who did it, mileage done, etc), then buyers will assess little value. Again, the buyer is often fearful of Joe Common installing things half-assed in his driveway. Without paperwork, this is what they will assume. Save your receipts people.

At the end of the day, the custom market is about making something that nobody else will have. Sure, people are bound to have the same stuff as you from time-to-time, but Degas also painted his skies blue too. The total finished product has to be unique and purely original if you want to make a profit on your build. Power level, sound, interior quality, paint finish, visual mod quality and selection, and the small details will determine what sells and what gets sold at a loss.

If you try to sell a new-ish car, it has to be perfect. Period. If it has too many miles, it has to be more than perfect. It also can't be kitschy or cliche (aka, barb wire pen striping on 90s era cars). It has to be modern for the period being sold and attractive... not only to you and the seller, but to different segments of the population. For example, you know you have a winner when the car guys at car shows mob your vehicle... but also when soccer moms put down their cell phone when you drive past. If people both young and old, muscle car fans and Prius drivers genuinely enjoy the car... then you're on to something.

In short, for a car to bring a profit, it must have broad appeal. People either want to buy your car to be seen in it or to resell it. Most people who buy used sports cars aren't buying it purely for themselves. They're buying it to impress someone else... or to maybe elevate their game if you will. Dealers want cars on their lot that not only can be resold, but can also draw other buyers onto the lot. Lot candy they're called. A good custom vehicle, even if it gets overpriced can sit and generate revenue just by being on the lot, right out front by the road. Dealers want a broad appeal type of car for this.

In summary, if you want to make money off your mods, it has to be done well. Perfectly. It has to be special, unique, and hard to duplicate.

/rant off

 

[Cobra Jet]

Sell the car to an overseas buyer - seems like the demand and price point is higher for American Muscle, no "poor" resale value...

 

[jacknifetoaswan]

That too, yes.

I had my 2010 Challenger R/T (paid $31,585 cash for it) and when I traded it in 18 months later they tried to hit me with $15,000 trade in value. I refused and they eventually bumped it up to $18,500.

I saw it on their lot two weeks later with a price tag of 28,000.

Used cars and service depts are where dealerships make the lions share of their profits.

I actually benefited from this, twice. When I bought my 2006 GT Premium in early 2009, it had just come out of warranty, and only had 13k miles on it. I paid $18,500 on a car that stickered for about $28,000. I put 56k miles on it, over seven years, then traded it for $11,500 when I bought my 2016. Initial depreciation was great, but then it held fairly well through the next seven years. Course, the dealer turned it around (with no refurb) and sold it as-is to the next guy for $13,900, according to the internet.

JR

 

[PJR202]

My nephew works at a dealership service department. He said they pull most cosmetic mods on trades (running boards, fender flares, etc) before putting them back on the lot, then divvy them up and keep them or sell them on the side.

 

[Hashbrownn]

Aftermarket mods do not add too much value. Maybe 30% of the parts value unless it is highend parts, but even then.

more like aftermarket parts will depreciate your car's value.. it definitely does not increase it

 

[chain]

If you had to guess....

How much would a '17 GT Premium PP with 5k miles go for in summer of 2018?

 

[Kevin08]

Yeah, I would never buy a modded car. Specifically a modded sports car. That to me is just a red flag that it's been hooned.

And unique does not mean valuable. The seller is just more likely to inflate his price with a sentimental BS dollar figure that only he thinks is worthwhile.

 

[Mike02z]

If you had to guess....

How much would a '17 GT Premium PP with 5k miles go for in summer of 2018?

My guess is 32k on a trade. 35k on a private sale. Best way to tell is to see what similar vehicles are selling for at auction.

 

[chain]

I am tired of waiting to get back on the track. Thinking of saying screw it and buying a '17 now and maybe trade it in next summer on an '18 if the new one just has that much going for it that I really want it. MSRP on the car to my specs is just over 41k, I think I can get it from Koons for about 34k. If so, I am thinking I can enjoy it for the summer and shouldn't lose all to much on trade in. What I'm trying to tell myself anyways lol.

 

[Mike02z]

Aftermarket mods can be a negative for a dealer who won't be interested in supporting them or wondering if the car will pass smog.

100% accurate. Before I sold my modified C7 I went to a few dealers I have done business with previously. One told me they would give me 55k for it. I asked him if I pulled all the mods off what he would give me. He said 55k. The car had over 11k worth of professionally installed modifications.

Dealers don't want modified cars. Your best bet is to sell privately. There will be someone who wants the options installed, especially if they are go-fast mods. If you trade it in, bend over and get ready to take it up the a**....

 

[jacknifetoaswan]

100% accurate. Before I sold my modified C7 I went to a few dealers I have done business with previously. One told me they would give me 55k for it. I asked him if I pulled all the mods off what he would give me. He said 55k. The car had over 11k worth of professionally installed modifications.

Dealers don't want modified cars. Your best bet is to sell privately. There will be someone who wants the options installed, especially if they are go-fast mods. If you trade it in, bend over and get ready to take it up the a**....

Yup. I pulled everything off my 2006 GT before trading it in, except the MGW short-shifter (too much damn work). I made some decent coin on sales of the parts, which was supposed to go to a tuner and cat-back for the new car, but priorities got in the way...

JR

 

[THX 138]

I sold my car to a Nigerian prince for $10k over what I paid for it. Shipped the car last week, just waiting for the wire to hit my bank. Suckers!

 

[VinnAY]

One of the big three reasons I lease...I'm never upside down. In this instance 0% would have been cheaper monthly as 'Stangs have shit for leases but I have the ability to walk in and drop the keys @ 36 months and walk away scot free.

 

[15wile]

Except for rare exceptions, cars are depreciating assets. Consumer goods. Even classic cars... think of how much was required to restore them to a condition where they can charge top dollar. People lose their shirts on those, too.

That being said, the Mustang actually holds up pretty well, all things considered, as long as you buy the right one. I bought a '15 base GT. Paid $29k new. For someone who wants a cheap V8, and doesn't want to pay full price, it's a good car. Could easily sell it to someone else for $25k-ish, private party value. Trade-in would be closer to $20k, probably. Hard to say, I don't trust the blue book trade-in values at all, these days. But I see similar cars sell in the local clubs for $25k-ish, if low miles and maintained well enough. Maybe even a hair more, if you've some *tasteful* upgrades. Ford dealers sell certified used f*cking ripoffs at like $27k. It's so stupid. For that price, buy new or something.

Aftermarket parts... you're usually better off returning the car to stock and selling the parts yourself. Always buyers for Mustang parts. Again, certain tasteful upgrades excepted.

Look, folks can whine about shit value, but there ain't a damn thing that can be done. Don't like the value? Don't sell the car. I'll probably keep this thing until it blows up. Get my money's worth out of it.

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