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19 Tradelink Road
Hillcrest, QLD, 4118

+61 7 3800 9127

At Ol' School Garage, we not only understand your passion for custom and classic cars, we share it. Rest assured, entrusting Ol' School Garage to undertake your custom build or restoration you are in good hands.

Leon's Blog

Classic American car prices set to skyrocket?

Leon Betts

About three years ago one Australian dollar purchased 1.05 US dollars. In finance speak, we were well above parity! This coincided with a downward correction in the classic American market (we saw the same happen in the Australian classic car market).

For Australian-based American classic car enthusiast, the economic circumstances couldn't have been better. Not only were car prices down in US dollar terms, our buying power was given a super boost by an Aussie dollar at historical highs.

Fast forward to 2015 and things are less than rosie. With our dollar yesterday breaking through the 80 cent barrier to A$0.79, our buying power has been eroded by well over 25% since the Aussie dollars peak (and financial commentators predicting further falls). Compounding this has been the rise in American classic car prices in the US market. An index of published by Hagerty, a large American classic car insurer, shows that the prices of affordable American classics are up 10% over recent years (see graph below).

So what does that mean for classic car prices here in Australia? The obvious answer is that we are going to pay a lot more when importing cars direct from America going forward. Firstly we will have to pay more for the cars in US dollar terms due to rising prices in the US market. But the real pain will come when we convert the US dollar price to the equivalent Australian dollars.

So it would seem that American classic cars are on the rise. There is some good news as the impacts in prices will take some time to work through the Australian market. Dealers like Ol' School Garage will have inventory that was purchased when the Australian dollar was stronger. There is also a small but healthy market for American classics in Australian which will continue to be bought and sold in Australian dollars. Although this market is influenced by US prices, our economic environment is probably the main driver.

Some of you may know that I spent well over 20 years as an accountant before seeing the light. So sorry to bore you with high-brow financial commentary...but boring comes naturally to me! However, if you are in the market for a classic American car or parts, you will be impacted in some way by rising prices and a weaker Aussie dollar.

Cheers Leon