Hong Kong classic car collectors turning their passion into the ultimate luxury investment
Owners with the money to spend keep their wheels pristine in secret garages; values of such cars can soar astronomically
You may have never seen a 1954 Mercedes-Benz 300SL Gullwing cruising the streets of Hong Kong, but a large number of classic cars like it are kept in their best condition – parked in air-conditioned and de-humidified garages across the city.
Over the National Day holiday weekend, more than 60 rare and vintage cars will be on show at the two-day Gold Coast Motor Festival along the Gold Coast waterfront of Tuen Mun, with many delivered to the venue by trucks because they were too precious to drive.
These antique cars are easily auctioned off for more than tens of millions of dollars, and their values are still rising despite limited mobility.
Alain Li, regional chief executive at luxury group Richemont, which owns Cartier, Montblanc and other high-end brands, is the owner of the 1954 Gullwing on exhibition.
Li said he only drove the 62-year-old car twice a year but he still had to maintain it from time to time. “You do have to spend some money to keep these cars,” Li, who declined to reveal the cost of maintenance, added.
The bright red Gullwing was kept in the United Kingdom under the care of top mechanics, along with his other collections before it was shipped to Hong Kong.
Despite the high cost of maintenance, Li would still make a fortune if he decided to put it on sale as only 1,400 such models were produced, and even fewer still exist today.
“I did not buy it for investment, but I am happy that the value for classic cars has actually increased – more than double over the last ten years,” he said.
However, some classic car enthusiasts prefer to feel the purr of their vehicles’ engines on the road.
Douglas Young, founder of Goods of Desire, a local lifestyle retail brand, owns 15 classic cars, and drives all of them on a rotational basis.
Kept in a secretive 5,000 sq ft de-humidified and sealed storage facility in the New Territories, Young said the cars are like family to him.
His line-up included convertibles, sports cars and recreational vehicles, with the oldest dating back to the 1950s. “I like variety,” Yong said.
“Some cars are like babies – naughty and with a character. They break down all the time,” he said, adding that he spent a great amount of time and money to keep the antique vehicles in good shape.
Sometimes, the maintenance cost can be higher than even the value of the cars themselves, he said.
It can also be cumbersome to hit the road with these cars.
Young said frequent traffic jams were bad for some engine parts of old cars, because they could be worn down by extended usage, and when the weather got hot and humid, he did not have the luxury of air-conditioning since the vehicles were antiques.
The cars also attracted too much attention, said Young, as passers-by would approach him to talk once he parked, and some others even request for selfies.
Another classic car collector, James Ogilvy-Stuart, is a diehard fan of British luxury sports car brand Aston Martin.
The managing director of wealth management firm MCL Financial Group said such cars were a form of investment. He said some rare models of Ferraris could see an astronomical increase in value even during an economic downturn.
For example, the average value of 13 of the most sought after street Ferraris from the 1950s-70s increased sevenfold to US$5.69 million (HK$44.1 million) in the last 10 years, according to the Hagerty Price Guide Index of Ferraris, a stock market style index.
“Surely the cars require some maintenance, but from an investment perspective, it is better than leaving the money in your bank [when interest rate is low],” Ogilvy-Stuart added.
“Over time, the returns from classic cars are better than that of the stock market,” he said.