Why are brands making million-dollar cars both new and old?

Despite their popularity among high dollar buyers, continuation cars from brands like Jaguar and Aston Martin are polarising — and potentially risky

by HANNAH ELLIOTT

EARLIER this fall, Aston Martin Lagonda Global Holdings plc announced it would make 19 new continuations of its classic DB4 Zagato GT from the 1960s.

They’ll be built at Aston Martin Works in Newport Pagnell, England, the company’s in-house classic-car department, and will have the same all-aluminium bodywork of an original DB4 GT Zagato, digitally scanned from the original and then hand-finished for maximum authenticity. They’ll have exactly the same 380hp, 3.8-litre, straight-six engine and a four-speed manual transmission as the original, too — which means it won’t be road legal for modern standards.

Thankfully, it will come paired with a road-legal DBS GT Zagato; it’s all part of a DBZ Centenary Collection celebrating the Italian design house’s 100th anniversary. Pricing starts at US$7.9 million (RM32.86 million) for the pair.

But don’t expect to see them on the track for at least 18 months. If anything, the 105-year-old brand has learned to take its time.

“It’s a balancing act. The continuation series has been the most controversial of our projects,” says Simon Sproule, the VP and CMO for Aston Martin Lagonda. “We have approached it with a cautious view. We know our strategy: We go slowly.”

Loosely defined, a continuation car is a vehicle no longer in production that the original automaker begins producing again, usually in limited amounts such as nine, or 25, or 50. These are not restorations or replicas. The cars are built new in accordance with the original standards and engineering plan, although some contain modern components.

The original equipment manufacturer (OEM) might continue the VIN numbering right where it left off — or start at zero.

James Bond’s original Aston Martin DB5, parked at Oxford University

In August, Aston Martin announced it would make a limited run of 25 continuation Goldfinger DB5s, complete with the lethal spy gadgets seen in the film and the same Silver Birch paint. The first cars will be built in 2020 and will cost £2.75 million (RM14.85 million).

Elsewhere in England, Jaguar Land Rover Ltd has produced classic Jaguar XKSS, Lightweight E-Type and D-Type continuation cars. The Tata Motors Ltd brand announced the D-Type earlier this year. It will look exactly like the original D-type, which won the Le Mans 24 Hours race three times from 1955 to 1957, with the same monocoque cockpit fashioned from sheets of aluminium alloy and a fuel tank in its tail.

The interior will have the same round speedometer dial; thin wooden, metal-perforated steering wheel (right-hand drive, of course); and four-speed manual shifter. The price tag will likely exceed US$1.4 million.

(Land Rover’s forthcoming Defender V8s, which were discontinued in 2016, are slightly different: They’re conversions of old cars with low mileage, not continuations built completely from scratch to original specification.)

Their sales success is uncontested. Virtually each continuation series offered from the likes of Aston Martin, Jaguar, Land Rover and Zagato has sold out before the official announcement of the vehicle — and for plenty of cash. Most range in pricing from US$350,000 to more than US$1 million.

“It’s a market that has created itself in the last five years,” Sproule says, describing the attention newer collectors pay to “modern classics” such as continuations. “There is a new breed of collector out there who is younger, has come into money through an (initial public offering) — or whatever it might be — and this new car collector is collecting modern classics.” It’s a reaction to general market interest in rare cars. “The sales numbers speak for themselves,” says Sproule.

Twenty years ago, a continuation car was worth half that of an original. In May 1998, a 1991 Aston Martin DB4 GT Zagato continuation sold for just over US$500,000 at a Brooks auction, according to Hagerty records. The very next month, an original Zagato-bodied Aston Martin DB4 GT took US$1.1 million at a similar auction.

Their values continue to hold, with prices of continuation cars still running at half or just under half the current value of the originals. And it doesn’t seem to be hurting the value of the actual classics.

“So far, our perspective is that continuation cars neither hurt nor enhance the value of the original cars,” Jonathan Klinger, a spokesman and analyst for Hagerty, tells Bloomberg Pursuits.

“We certainly keep track. It’s a very calculated programme the brands do; the last thing they want is to dilute their brand or hurt the market.” A flashy gem from an automaker’s past might not reflect well on the bland sedan it makes today.

For high-end brands, the value and rarity of certain blue-chip vintage items circulating through auctions and private sales always relates to, and sometimes informs, the value of their modern collectable cars.

Continuation cars remain polarising. Some say they mark the downfall of car society, encouraging relatively instant gratification and ease of driving, whether or not a particular car is original and authentic to its period.

“You can say they’re attracting people who don’t want the experience of an old classic car,” says Stephen Serio, owner of Aston Martin of New England and the Bond Group, a consultancy and brokerage firm for collectible cars.

“It’s nothing more than a cash grab” for the companies, he says. “It cheapens the brand. It makes a mockery of it.”

The vehicles can often be found twisted into things that aren’t OEM-made continuations, but are close: Replicas, recreations, kit cars and the like. Exhibit A: In the 1980s, various third-party companies started building kit-style replica or “tribute” Shelby AC Cobra cars, with myriad levels of quality, engineering and authentic provenance. Carroll Shelby himself authorised true continuations of the original AC-built Cobra series made by his own company, which served to further dilute the market.

Then there’s that thing about driving them: You can’t on city streets in Europe or the US, nor in historic races and rallies.

Most of the cars aren’t homologated to comply with modern safety and emissions standards on public roads. For those who believe beautiful, powerful, iconic cars are meant to be driven, it’s an outrage.

“Why would you buy something you can’t drive?” Serio asks. “Maybe you can drive on the track for club days — so you spend millions of dollars on a car you can use twice or three times a year? This is just not cool.”

Sproule contends that many who buy the continuation Aston Martins already own the original cars; they just want something with which they can tool around on the track, even if infrequently.

“The buyers of the continuations are serious collectors. They understand the model; they understand what it is about,” he says.

For those who can afford this high sixand seven-figure price point, it’s about having fun more than winning an investment proposition: “These are collectors at a level where they just want to have unique, fun cars. For them, it’s a new type of collectible car, so if you’re into James

Bond and you’ve got a big car collection — and you’ve got everything — there’s some whimsy in collecting, isn’t there?”

Jaguar has as good a reputation as any for making careful, exact continuations in extremely low batches. It’s not a wildly profitable programme, says Tim Hannig, the director of Jaguar Land Rover Classic, though it does make money. He declines to specify exact revenue or profit margins, as does Sproule.

“It washes its face and it pays my salary,” Hannig says. “But we don’t have so much money, we don’t know what to do with it.”

Rather, Hannig says, the real value of the continuation cars is the awareness and interest that they cultivate for Jaguar as a company. They’re hype machines.

“There was a lot of concern when we did the first lightweight E-Type (in 2014) — that it might deteriorate values — but the other way around happened,” he says. “Suddenly, people were talking about these cars. It promoted the car in its own right. It allows us in a different way to communicate about the past and show what we have as heritage.”

Alexander Weaver, a car specialist for RM Sothebys, concurs. He says it even works for cars that are borderline continuations, such as the gold-yellow metallic Porsche sold for US$3.42 million last month at a Sotheby’s sale in Atlanta.

Since the one-of-one 993, which officially ended production in 1998, is a single, unique car built for charity, it’s not technically a continuation series. But it’s darned close. (Ask five people if they think it qualifies as “continuation” work, and you’ll get five different answers.)

The Porsche 993 (right) was brought back and made as a single special car to help launch a new series of Porsche 911 turbos. The original 993 line was discontinued in 1998

More important, it garnered rabid Internet and social media attention for Porsche Classic, the division that made it, and for another car also featured at the Atlanta sale, which Porsche AG will soon be selling in volume: The 911 Turbo S Exclusive Series.

“I think it was a great thing. Porsche were showing off a bit as to what they can do,” Weaver says. “It was a great way for them to launch the Turbo S Exclusive Series, and a very good way for them to show what they can do with Porsche Classic. The air-cooled market has been exceptionally strong — and was before the sale and will continue to be after the sale.” — Bloomberg