Join Date: Feb 2001
Location: The Hills of North Georgia,USA
Six-figure autos roll off lots in Metro Detroit
Sunday, February 16, 2003
Sluggish economy, war talk don't slow sales of Ferraris, other high-priced, exotic cars
By Ed Garsten / The Detroit News
Ricardo Thomas / The Detroit News
WEST BLOOMFIELD -- Most automakers may be tossing cash at customers like chum in a fish pond -- hoping they'll bite -- but Ferrari sales manager Daniel Cable's eyes crinkle in bemusement when he tells the story of customers who offered to throw money at him.
"Last weekend, I had four people offer me cash personally to get them a car," said Cable, of Cauley Ferrari-Maserati in West Bloomfield. "One client bought a red Modena 360, came back in and said, I'll put $20,000 in your pocket if you can get me another car this year sometime.'"
Indeed, while it takes cash on the hood and no-interest financing to sell the latest Chevrolet, Mercury or Toyota these days, Cable has a list of customers waiting up to three-and-a-half years for Ferraris that start at $200,000 and reach $650,000.
Against a fragile U.S. economy, dogged by war prospects and sluggish employment growth, Cable and other dealers are amazed at the demand for exotic cars, including Bentleys, Aston Martins and Rolls Royces, with lofty price tags.
"You just can't believe there's this much wealth out there that people will go to those lengths to get a car," Cable said.
Cable added he doesn't accept payments to move people to the head of the line.
Cash rebates or zero-percent financing? Forget it. Customers are happy to pay thousands of dollars above sticker price for the privilege of owning one of the few vehicles that trickle from the factories of the world's boutique automakers each year. Despite the evaporation of billions from investment portfolios in the last few years, financing's not an issue: 99 percent of the sales are cash.
Last year, Ferrari's U.S. sales reached 1,122 units, up 2.9 percent, while the overall car and truck market dipped 2 percent.
"We are at a record level of income equality, a record number of billionaires and multi-hundred millionaires," said Sean McAlinden, an economist with the Center for Automotive Research in Ann Arbor. "These people are impervious to economic cycles."
In the typical U.S. household, annual incomes are growing at an average rate of 7 percent, mainly because of tax cuts and refunds. It's a growth rate Comerica chief economist David Littmann calls "phenomenal."
On Thursday, Bloomfield Hills dentist Gary Warr drove home his first Bentley from Suburban Rolls Royce-Bentley-Hummer in Troy. Riding in his meteor blue Arnage, Warr said the $225,000 car was something he had coveted for a long time.
"I arrived at a point in my life where I could get it," said Warr. "I was kicking tires and took one for a test drive, and I bought it."
The dealership already has 50 orders for the $150,000 Bentley Continental and several prospects in line for the Continental GT, said sales manager David Butler.
Over at Cauley Ferrari-Maserati, the dealership's annual allotment of 35 Ferraris has all been sold to customers who have waited more than two years.
Dennis Lane is one of them. The insurance agency owner recently drove home in a $200,000 Spider. Lane says it's a worthwhile indulgence despite hits to his investment portfolio.
"You've got to make yourself happy," said Lane, who is married with four grown children. "I work real hard and I want to have something to show for it."
David Levy's latest high-priced plaything is a customized Aston Martin DB7. The suburban Detroit industrial auctioneer and appraiser has children, but says the DB7 "is my baby."
"It was hand-built to my specifications, to what I was looking for in terms of performance and comfort."
Aston Martin, a unit of Ford Motor Co., had a record year in 2002 -- selling 456 cars in the United States and 1,800 worldwide, according to Simon Rodd, the British automaker's American operations manager. The automaker's lineup of racy sports coupes is priced from $145,500 to $235,000.
The wait for the top of the line Aston Martin Vanquish had been as long as two years, but because of increased production "we might be able to fill a spot by the end of the year," said Molly Padovini, general manager of Aston Martin-Jaguar-Saab of Troy, where Levy bought his car.
Cauley's Daniel Cable says he's only had two orders for Ferraris ever cancelled: one because of a divorce, the other for a death.
His customers, he says, know the cars hold their value, making them good investments.
"It's not unusual right now to see a year-old Ferrari with 2,000 or 3,000 miles on it to carry a $70,000 premium above the original retail price," Cable said.
Extravagant? Sure, but Warr jokes that his sumptuous Bentley Arnage also is practical for a man with a wife and two children.
"It's a good family car," he said. "They approved immediately."
(Photo)David Guralnick / The Detroit News
An Aston Martin DB AR1 draws some admirers, despite its $245,000 price tag, at Aston Martin-Jaguar-Saab of Troy.
My first car was a 67 Mustang Coupe, 2nd one was a 67 Cougar XR-7, 3rd one was a 66 Mustang Coupe. Why did I get rid of these cars for ? I know why, because I'm stupid, stupid, stupid.
My next Ford.....