Why Do Classic Cars Go Up in Value?

Most of us have experienced this at some point: you’re at the dealership, ready to trade your car for a new one or for a newer used car. The dealership’s used car manager has gone over every aspect of your car with an expert’s eye and is about to give you what the manager considers your trade-in value. It’s a little bit like finding out what’s behind Door Number One on a game show: there’s a moment of anticipation before you find out the number.

And then you might be pleasantly surprised, especially these days if you own a high-demand model. But if your trade-in value isn’t as high as you hoped, you might wonder, “How did they value my trade?” And your mind might wander to your neighbor who sold a 20-year-old BMW for more than he paid for it. He said his car was considered a “classic.” But what made his car a classic while yours barely avoided the dealer’s wholesale lot?

Cars, unlike fine wine, don’t usually get better with age. Depreciation hits them from day one, and before you know it, your once shiny car‘s value has faded like that new car smell. But then there’s the world of classic cars—those old beauties that defy economics and just keep climbing in value. Ever wondered why? There’s a bit of magic and mystery behind why certain cars become icons, fetching jaw-dropping prices at dealerships or auctions while others are left in the dust. Is it all about age and staying in mint condition, or is there more to the story? Why do some cars transform into valuable treasures over time while others don’t make the cut?

How Did They Value Your Trade?

Let’s start with the moment the used car manager told you the value of your trade-in. We’ll walk through the process that produced the magic number and discuss what you can do to get as much as possible for your old set of wheels.

The person who will make the determination is the used car manager, who has a pretty set routine for figuring out how much your car is worth. First off, they’ve got a few handy guides to help them out. Kelley Blue Book and Edmunds.com are like the holy grails of car values, and they’re accessible to everyone, including you. Then there’s the mysterious Black Book, a dealership-exclusive guide that dealers pay to access. All of these guides provide a solid starting point for valuing your car.

Now, it’s time for the hands-on part. The manager will take it out for a spin, paying attention to how it drives and listening for any odd noises. He or she will check out the exterior for any scratches or dents and scrutinize the interior for any wear and tear. It’s like a mini check-up for your car.

Finally, they’ll consider other crucial factors. How old is your car? What’s the mileage? General condition is key, and if your car has some cool options or features, that might bump up the value. Plus, if you’re the only person who has owned it, or if you’ve got a complete record of all the services since day one, your car might be worth a bit more. It’s all about showing that your car has been loved and well cared for. Also, timing can matter: convertibles sell well when summer is on the horizon, and 4×4 vehicles sell better when the first flakes start to fly.

Now comes the part that might be tough to swallow: the dealership will offer you the lower end of the range of trade-in values for your car. This is because they will need to take it through their reconditioning department to get it in showroom condition and because they expect to make a profit on the sale. However, there are things you can do to improve the trade-in offer or negotiate a better one when you’re haggling with the sales staff.

How You Can Get a Better Offer

We mentioned bringing in your service records for the car. That’s a good start. And this might seem a no-brainer, but make sure the car is clean and clutter-free. Maybe you’re tempted to swing by the dealership on your lunch hour or on your way home from work just to see what they’ve got, but if you’re serious about trading your car, wait until you have time to get it cleaned up.

If your vehicle has a lot of high-tech features, you might want to delete your address from the navigation and disconnect Bluetooth pairings, built-in garage door openers, and satellite radio subscriptions, just in case you end up coming home in a different vehicle. It probably won’t be a big deal, but better safe than sorry, right?

Knowing approximately what your car is worth before you go to the dealer is a smart strategy. We mentioned Kelley Blue Book and Edmunds, and there are a number of other sites that can give you a good idea of what you’ve got: AutoTrader, CarFax, and the National Automobile Dealers Association are three good resources with websites that can help.

Remember that the number the dealership quotes you is an opening offer. You can negotiate. One tactic is to quote one of the car pricing authorities listed above and ask if the dealer can match the offer. Or, when you are presented with a lease or financing offer, see if you can improve that offer by asking for more for your trade. And don’t forget one of your best weapons in this negotiation: get quotes from multiple dealerships and go with the best one.

What About Those Classics?

So, what is it about certain cars which makes them defy logic and become more valuable with time? Well, most of them start out losing value just like regular cars, of course, with the exceptions of some insanely expensive, ultra-low volume exotics that pretty much gain value from the moment that potential customers even look at them. For example, the 2014 Lamborghini Veneno Roadster, with a production run of exactly nine units and an eye-watering sticker price of over $4 million, was already selling at auction for over $8 million just a few years later.

But that’s a car for the ultra, ultra-rich, almost like bringing Leonardo DaVinci to the present day in a time machine and having him paint your portrait. How could you put a price on that? The same thing applies in the rarified world of super-exotics: prices lose meaning. Your average or even significantly above-average car won’t follow that pricing trajectory.

So, what makes a car become a classic with a rising value? A combination of rarity, condition, desirability, or popularity of the model, the quality of a restoration job, historical significance, and originality of parts will all combine to make a car worth more than it was new, possibly even after adjusting for inflation. Some of that is obvious. For instance, a ‘63 Corvette Split-Window Coupe rings all the bells for desirability, rarity, and historical significance. But your great-aunt’s 1963 Plymouth Valiant station wagon: not so much.

Age alone doesn’t make a well-preserved or well-restored car more valuable than more recent models. The most famous example would be the ‘57 Chevy Bel Coupe, which is considered much more collectible than its predecessors due to its style with its signature enormous tail fins. But sometimes, the opposite dynamic is at play: an older model might be more desirable to collectors who think its successors never lived up to it.

For instance, the E46 model of the BMW M3, built from 2000 to 2006, is highly collectible because BMW enthusiasts believe it was the high point of the M3. As a result, prices for this generation of M3 started to climb within about fifteen years of the end of its production run. This is an excellent example of how a car started out like any other, losing value after it was driven off the dealer lot, but eventually turned around and started appreciating in value as it began to attain the status of “classic.”

Am I Trading Away a Classic?

Your car probably won’t end up becoming a classic. It’s very hit or miss; a regular 1987 Buick Regal would only be worth perhaps a few thousand dollars today, even in great shape. Yet the completely insane Buick Grand National GNX that was built from the same platform has become a true classic, which sometimes sells for way into six figures. Back in 1987, if you bought a GNX as an investment, a lot of people might have thought you needed your head examined.

We would say not to worry too much about the future value of your car. Here at Zimmer Motors, we’ll give you a more than fair price for your trade and help you get into a brand-new Chrysler, Dodge, Jeep, or RAM that will become your own personal classic for years to come. And who knows? Someday, decades from now, someone from the next generation of your family might see a fully restored example of your new car and think, “Aw, I remember riding in one of those! It was awesome!”

Nothing is as classic as that kind of memory.