Supercars for the super-rich | Fin24
 
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Supercars for the super-rich

Jan 22 2016 06:30
Glenda Williams
McLaren 570S

McLaren 570S (McLaren)

The economy might be tanking, but that has not put a stop to the supercar audience, according to luxury car aficionados.

“A new assortment of global super-rich is pouring into South Africa. They’re not only driving up the price of real estate, they are also driving the world’s best supercars that would make even Sebastian Vettel jealous,” says CEO of IBV Supercar Club, Ashok Sewnarain.

Aston Martin, Ferrari, Lamborghini, McLaren or Porsche are just a few of the iconic supercars that might make it onto the list of those with plenty of moola.

Considering the eye-watering asking prices that come with purchasing such a vehicle, it says much about the country’s growing affluent and local petrol heads with a passion for cars. Even exclusive supercar clubs are springing up to cater to this growing market.

“They’re mostly male, between the ages of 35 and 45, married, have no more than two kids, have a successful, entrepreneurial business, or are in a financial position where they manage other people,” explains Sewnarain.

And it seems they pay for these super machines in cash. High-end luxury car importer and distributor, Daytona Group tells finweek that on average only 13% of its vehicles sold are financed.?South Africa now boasts 48 700 dollar millionaires, with African ultra-high-net-worth individuals expected to grow at 59% in the next 10 years, outpacing the projected global growth of 34% according to property consultancy Knight Frank.

Those stats must have been an attractive carrot to luxury sports car manufacturers so it’s little wonder that Italian luxury car manufacturer Maserati recently celebrated its official return to South Africa citing the country as “considerable potential for Maserati and a unique opportunity to expand our company into a growing market”.

Among their line-up is the Ghibli with a R1.3m price tag while their flagship Quattroporte model sells for a cool R2.47m. In 2014 Maserati grew its worldwide annual sales to 36 500 units through entering new markets and new additions to its product portfolio. This was compared with the 15 400 sold in 2013.

McLaren too has a presence in the country through retail partner Daytona. Daytona, which also holds the Aston Martin and Rolls Royce dealerships, boasts an annual turnover in excess of R3.5bn.

On average Daytona sells three McLarens and five Aston Martins every month. “The Aston Martin brand is performing exceptionally well in South Africa and we have grown our sales on a year-on-year basis,” a company spokesperson tells finweek.

That said, locals are unlikely to see an Aston Martin on a regular basis. Aston Martin is one of the smallest producers of luxury sports cars in the world, having resisted the temptations of mass production, and still insists on assembling each of its cars by hand, meaning that production is limited.

“In terms of McLaren we continually achieve our targets set by the manufacturer and often surpass their expectations. We have no doubt this will continue and a steady growth can be expected for 2016,” says Daytona.

Until recently, it would have cost R5m to be able to boast about being a McLaren owner. But aiming to dent markets like Porsche, Ferrari and Maserati, McLaren now has a more “attainable” offering: a mere R2.8m for their McLaren 570S.

Porsche, however, has a firm grip on the local supercar market, with its volume selling 911 derivatives starting from a somewhat more affordable price point of around R1.3m. For prancing horse fans, a price tag of around R3.7m will acquire them the entry-level ?Ferrari California T.

The economy now is less than dynamic and new supercar sales do appear to be under a bit of pressure (see tables). Based on National Association of Automobile Manufacturers of South Africa (NAAMSA) figures, 37 new Ferraris, 30 new Maseratis and 340 new Porsches (sports-only models) were sold in South Africa in the first half of 2013 for a total of 407 units for the three famous supercar brands alone.

The first six months of 2015 reflect a slight drop in volume to 402 for the famous three made up of 52 Ferraris, 12 Maseratis and 338 Porsches. Yet that does not mean the affluent are not buying. The pre-owned market (not used please; it’s infra dig for this market) for luxury sports cars is just as active.

There is no shame in buying a pre-owned supercar, quite the opposite. Lean supercar production volumes create exclusivity and strong demand, so lengthy waiting lists are not uncommon, even for some pre-owned supercars.

Desire for status and prestige aside, it can also make financial sense to invest in a supercar. Unlike the depreciating ordinary vehicle, the values of these highly desirable machines can appreciate. This, and the fact that the uber-rich are more immune to economic downturns, it’s unlikely this elite group of individuals will apply brakes to their supercar spending.

This article originally appeared in the 28 January 2016 edition of finweek. Buy and download the magazine here.


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