Why I Am Excited About The Future Of Formula One Racing

Hey Cool Car Fans,

If you’ve ever watched F1 racing you know how cool these cars are and recently a Colorado billionaire, John Malone of Liberty Media purchased the rights to Formula One racing.  If you’ve never seen Formula One racing let me share with you from a cool website called Zeroto60times.com how fast these race cars are and you’ll see why I am excited about the future of this sport.  Especially, if we can get some more Formula One racing here in the United States.

“Formula 1 cars are some of the fastest and radically accelerating vehicles on Earth and are considered by many car enthusiasts to be the pinnacle of motorsports. Today’s F1 0-60 times are exponentially faster than predecessors of even a couple decades ago. Formula One race cars have been recorded to reach 0-60 as fast as 1.6 seconds, however the typical range for modern day F1 cars is between 2.1 to 2.7 seconds. The 2007 Honda RA107 f1 race car goes 0-100 mph in a blistering 4 seconds flat.  The 2015 Infiniti Red Bull RB11 Formula One race car jets 0 to 60 in only 1.7 seconds, and perhaps even more impressive can reach 190 mph in under 10 seconds.  Although top fuel dragsters hold the top spot for fastest accelerating race car class, the F1 race car boasts a range of superior performance stats. F1 0-60 times are extreme, however so are their ability to perform incredibly tight high speed maneuvers, decelerate and reach impressively high top speeds. Under hard braking or cornering a typically F1 car will pull 4g’s, which is over 4 times as much as a 2014 Corvette Stingray Z51 would do which produces a max of 1.03g in hard cornering. The power to weight ratio of F1 race cars would actually allow for better performance, however current traction technology limits the capability to improve these current stats. Most F1 cars weigh around 1,300 pounds with the driver and boast over 750 horsepower. In other words, the power-to-weight ratio of formula one race cars is credited for the spectacular acceleration.” – Zeroto60times.com

These cars are super cool, but the race series is not winning over new fans and that’s a problem for the future of the Formula One racing.  John Malone’s Liberty Media has agreed to buy the racing series in a deal that values it at $4.4 billion, plus debt that will take it up to $8 billion.  That’s big bucks for a racing venue, but this is Formula One racing, which is the Super Bowl of race car driving and a global audience.

Since the announcement was made back in September other news reports have said that they intend to put spending caps on race teams.  This is a great idea because Formula One has been dominated by Red Bull and Mercedes Benz.   This is because they can spend $400 million or more on putting together a racing team and other teams have been spent into ruin trying to compete, which has created an unfair advantage for smaller teams.  It’s not a big win for the fans when two teams can dominate the racing circuit with better technology and loads of cash, so it will be interesting to see how it all shakes out with the new owner.

I don’t expect that Formula One will be huge here in the United States, but we might get some Grand Prix races in some larger cities like New York and Los Angeles out of it.  I’m hopeful that in the coming year we’ll see some changes with the new ownership and that more of the races will be available to watch and follow because it’s a really cool sport.  I’m including a cool video that is under ten minutes that I found on Youtube to check out below.

I want to thank all of my clients for a great 2016 and I am looking forward to 2017 and what it has to bring.

 

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John Boyd

Auto Consultant – John Boyd: The Cool Car Guy
John is an auto consultant with his license at a car dealership in Denver, Colorado. He can help you save time and money on any make or model, new or used, lease or purchase – nationwide! Call or email John about your next vehicle! jboyd@coolcarguy.com or Twitter @coolcarguy

A Tale Of Two Classic Porsches

Hey Cool Car Fans,

I often get requests from clients to help them find a good deal on a specific classic car and I’ll usually start out by searching through the dealer auctions.   Recently, I was cruising through the auction and I spotted a couple of Porsche 356’s from the early 1960’s that I decided to showcase here and write an article about.

One of the reasons why I selected these two vehicles is because of the incredible disparity in price between the two vehicles.  I wanted to use this article to illustrate the fact that no two vehicles are ever the same, especially when it comes to classic cars.  Much like a piece of a artwork the beauty is in eye of the beholder and what has gone into the creation of the vehicle.  Many factors come into play from vehicle restoration, make, model, year, original miles, overall condition, who did the restoration, color, popularity, scarcity, etc.

First I spotted this 1962 Porsche 356B that was yellow and black with about 100,000 miles on the vehicle.   The description of the vehicle didn’t really say much about it though.  This vehicle was being priced around $72,000 with auction fees and shipping.  Here’s what they had to say about it, but let’s get some more research on this year and model as well.

The Listing: “WOW New 356B Original Rust free pans, new paint excellent interior Super 90 Spec Engine, Sport Exhaust, Carrera Tail panel & much more. Some details still awaiting completion but wanted to get these stunning pictures out there.

Porsche 356 History

“The 356 was created by Ferdinand “Ferry” Porsche (son of Ferdinand Porsche, founder of the German company), who founded the Austrian company with his sister, Louise. Like its cousin, the Volkswagen Beetle (which Ferdinand Porsche Sr. had designed), the 356 is a four-cylinder, air-cooled, rear-engine, rear-wheel drive car with unitized pan and body construction. The chassis was a completely new design as was the 356’s body which was designed by Porsche employee Erwin Komenda, while certain mechanical components including the engine case and some suspension components were based on and initially sourced from Volkswagen.” – Source: Wikipedia

One of the reasons why the 356 is popular is because it was originally created by the son of Ferdinand Porsche and it’s a cool body style.  In addition, it’s an extremely popular Porsche model and is claimed to be the world’s largest classic Porsche club of all the models.  They also are popular for rally and racing car events as well.  What about the 1962 though compared to the 1960?  Actually, there were not huge changes in these vehicles from 1960 to 1962 since the biggest changes to the 356 actually occurred in 1959.

“In late 1959 significant styling and technical refinements gave rise to the 356 B (a T5 body type). The mid-1962 356 B model was changed to the T6 body type (twin engine lid grilles, an external fuel filler in the right front wing/fender and a larger rear window in the coupé). The Porsche factory did not call attention to these quite visible changes with a different model designation.” – Wikipedia

The second vehicle I spotted was a 1960 Porsche 356B convertible, which I’ve put some photos in this article of as well.  This vehicle was a complete restoration with an asking price of around $189,000 with auction fees. The first 1962 Porsche that looked like a pretty sweet ride was being listed at around $72,000 and this one was being listed at around $189,000.  That’s a big spread in price.

Why the massive difference in price for a Porsche convertible compared to a coupe that was originally built within two years of the other one?  Let’s look at how this one was listed and described compared to the other one because this vehicle is a complete restoration and you can see the difference between the two vehicles.

The Listing: “1960 Porsche 356 B Super 90 Convertible Signal Red Tan Leather Interior 1600cc Super 904-Speed Vin/Serial: 87746 Full Restoration in 2014 500 Miles Since Restoration Rust Free Body Rebuilt Drivetrain Solex P114 Carburetors New Clutch New Brakes and Suspension 12-Volt System Leather Trimmed Seats Leather Trimmed Door Panels Leather Trimmed Dash Detailed Undercarriage New Seals and Weather Stripping Constant refinement has always been the watchword at Porsche but the new-for-1960 356B represented a marked leap forward in both mechanical and cosmetic features. Most notably the traditional dropped nose and slanting headlight covers gave way to a raised front bumper and fenders and more upright headlights. The T5 body style also introduced such new details as opening front quarter windows except on the Draus-bodied Roadster so named to appeal to the fast-growing American market. Famed photojournalist Jesse Alexander described the 356Bs new T5-series body as a rather drastic face lift that will come as a shock to Porsche owners all over the world but today it is symbolic of Porsche excellence. This superb Drauz-bodied 1960 Porsche 356B T5 Roadster is presented fresh from a three-year no-expense-spared nut-and-bolt restoration completed in 2014. After being stripped to bare metal the rust-free body was finished to high standards of fit and finish and expertly painted in Porsche Signal Red. In addition to all new seals weather stripping and exterior trim it features excellent glass chrome and canvas top Concours-standard detailing including the undercarriage and a crisp clean Tan interior with leather-trimmed seats door panels and dash pad square weave carpets and fully functioning controls and instrumentation. The restoration included rebuilding a Super 90 1600cc flat-4 engine with Solex P114 carburetors. The transmission was also rebuilt and a new clutch installed; the completed driveline now has approximately 400 miles of use. All steering linkage brake system and suspension components have been restored or replaced and the electrical system upgraded to 12 volts. This marvelous collector-grade 356B Roadster is offered with the Porsche Certificate of Authenticity.”

I think these two vehicles really illustrate why there can be such a difference in price for the same type of classic cars.  In the words of Donald Trump, the next time you contact me about a classic car you can see how the difference between cars can be “huge”.

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John Boyd

Auto Consultant – John Boyd: The Cool Car Guy
John is an auto consultant with his license at a car dealership in Denver, Colorado. He can help you save time and money on any make or model, new or used, lease or purchase – nationwide! Call or email John about your next vehicle! jboyd@coolcarguy.com or Twitter @coolcarguy

Who’s Building Your Car These Days?

Hey Cool Car Fans,

It is amazing how global the automotive industry has become over the years as we have watched prices of vehicles skyrocket.  Isn’t the idea that if you manufacturer something in another country you should be paying less?  We’ve seen that with calculators, computers and digital watches, but apparently not with cell phones and automobiles.

In some ways, the consumer has been hoodwinked into paying way more for less value than what people would expect to be paying for vehicles today that are being outsourced to other countries.  Many of the vehicles today are more expensive than what people used to pay for a house or what they can still pay for a house in some parts of the country.

Car loans have gone from three and four years to five and six year loans as common and even seven and eight year loans!  I have helped people do a five year lease on a used vehicle to get a lower payment, so that they can roll out early based on depreciation, which is still better than an eight year loan.

Let’s look at the new 2017 Chevy Bolt for example and who has been involved in creating this new vehicle.  According to Wikipedia the Chevy Bolt was created in conjunction with LG.

“The Chevrolet Bolt or Chevrolet Bolt EV is an all-electric subcompact car developed by Chevrolet in partnership with LG Corporation.[3] Production for the for model year 2017 began in November 2016.[4][5]

Isn’t LG known for making televisions, washers and dryers?  The Chevy Bolt though is an EV (electric vehicle), which other than the batteries may have a motor that could last 20 years like your electric dryer.  If you have read CoolCarGuy.com for any length of time you know that I believe the electric vehicle is the ultimate in planned obsolescence.

I love the awards many of these new technology electric vehicles get too.  I’m not sure that many of us have ever even heard of some of these awards, but they sound really good.

“The Chevrolet Bolt won several awards including the 2017 Motor Trend Car of the Year award, the 2017 AutoGuide.com Reader’s Choice Green Car of the Year, Green Car Reports Best Car To Buy 2017, Green Car Journal‘s 2017 Green Car of the Year, and was listed in Time Magazine Best 25 Inventions of the Year of 2016.[10]

Call me a skeptic, but when I sold windsurfers back in the mid 1980’s and computers back in the early 1990’s I remember the magazines giving awards to the companies that I was selling for numerous times because they were huge advertisers with the magazines.  Of course, I’m not saying this has happened here, but I take awards in the automotive industry with a grain of salt.

Getting back to who is building your car today though, if we read a little further about the Chevy Bolt we discover that not only is LG in South Korea involved in manufacturing the motor, battery and drive unit, but the former car company Daewoo was involved in the design of the vehicle.  The only thing that is Chevrolet about the Bolt is the brand name and that it is being assembled in Detroit, Michigan.

“The Bolt was designed by GM’s Korea studio (formerly Daewoo Korea), as B-segment size[28] on its own platform, and does not share elements with the GM Gamma platform cars Chevrolet Sonic/Spark/Opel Corsa.” – Wikipedia

I don’t know if this is a great vehicle or not since I haven’t driven one yet, but I find it fascinating that this vehicle has an MSRP of $37,495 for an all electric vehicle.  If you subtract a federal tax credit to encourage people to buy electric vehicles than the price drops to $29,995 for the MSRP.  The reasoning behind this vehicle is to avoid paying for gas and that most people are only driving about 40 miles a day, but you have to spend a ton in fuel to justify the cost.  It is still going to be a pretty good seller for Chevrolet I’m sure with the increased interest in electric vehicles and all of those award that it’s received – lol.

You could get a 2000 BMW Z3 similar to this one (I’m not selling this one, just showing an example) that I spotted through the Manheim dealer auction that gets great gas mileage and has about 77,000 miles for less than half the price of a 2017 Chevy Bolt.  I would take an older BMW hands down personally, but I recognize they are not in the same category.  My point is that there are some great used vehicles out there that you don’t have to spend $30,000 on with a tax credit to get a cool car.

I’m not trying to pick on the 2017 Chevy Bolt in this article, although it probably seems that way, but I am really just trying to make the point about who’s really making your vehicle.  The fact is that so many vehicles are being outsourced today by all of the manufacturers that you really have to do some research to find out who’s designing, manufacturing, assembling and building your vehicle before you plunk down your cash.

Maybe you don’t really care either?  After all, Chrysler Jeep is owned by Fiat, Mercedes Benz for a while owned Chrysler, so if you own an older Chrysler it could very well have some Mercedes Benz technology in it.  Ford owns Mazda and used to own Land Rover and Jaguar that are now owned by Tata Motors out of India.  Some of the Land Rovers were a disaster for repairs, while Ford owned them.  Nissan is owned by Renault and we’ve seen a number of changes in those vehicles over the years compared to when they were strictly Japanese and the old Datsun brand.

We’ve all seen the issue of recalls with airbags over the past year with a number of manufacturers.  Vehicles are costing more money, but are people really getting more bang for their buck?  I think it depends on the vehicle, even the vehicle within the same manufacturer. Which is why it’s important to do some homework before you purchase an expensive vehicle and know what you’re really getting.

It’s one of the reasons why many people contact me about getting older cool cars, like that BMW and customizing them with navigation, upgrading the interiors and modernizing them with newer technology.  They can often do this for far less than what they are going to pay for a new vehicle that at times feels more like they should have a “made in China” sticker on them.

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John Boyd

Auto Consultant – John Boyd: The Cool Car Guy
John is an auto consultant with his license at a car dealership in Denver, Colorado. He can help you save time and money on any make or model, new or used, lease or purchase – nationwide! Call or email John about your next vehicle! jboyd@coolcarguy.com or Twitter @coolcarguy

Should I Buy or Lease That Luxury SUV?

Hey Cool Car Fans,

I have clients from all walks of life and often times I’ll have clients contact me about buying or leasing a luxury SUV.  For example, Maserati is introducing a new SUV in 2017 called the Levante that will be available in both a diesel and a gas powered engine.

This is a super cool, high-powered SUV with up to 430hp in a twin-turbo V6 motor.  The Maserati website describes this vehicle as follows…

“The Levante is an SUV like no other, embodying the passion, the sophisticated engineering and exclusivity that have distinguished every vehicle engineered and crafted by Maserati in the heart of Italy since it was founded in 1914.”

This should be a popular SUV for a very specific market segment and it’s a super cool ride, but it also has some serious competition.  Jaguar has the F-Pace that they have rolled out, which is less money, but is smaller in size.  There is the tried and true Porsche Cayenne that is another high performance and well made vehicle.  The Jeep Grand Cherokee SRT-8 that has plenty of horsepower and Jeep has been making the SUV forever.  The always popular BMW X5 that is available in a number of configurations that has been around for a long time as well.  Meredes-Benz with their assortment of SUV and the Tesla Model X that is the new SUV from Tesla to name just a few of the options available from luxury car companies.

The problem though is when a manufacturer rolls out a new product, like Maserati and Jaguar are doing, do you really want to be the guinea pig and purchase the vehicle?  I wouldn’t recommend it.  I didn’t say I don’t like these vehicles.  I think they are really cool, just like many of the others I’ve mentioned in this category.  I would just suggest leasing a first release vehicle like the Maserati, the Jaguar or the Tesla and letting the leasing company share in the risk.  This is because we don’t know what the depreciation is going to look like over three or five years for a newly released vehicle.  It gets even more sketchy with the Tesla because many people want the electric vehicle for the tax incentives, but it’s hard to unload a used one without the appeal of a tax incentive.  If you lease it you can drop the keys, walk away, fix your costs and tell the leasing company the vehicle is theirs and to have a nice day.

The reality is that we can look at a three year old Infiniti QX80 and know what they are selling for today.  You can purchase or lease it and have a good idea about what it will be worth when you’re ready to unload it in the future.  We have no idea what to expect from a Maserati Levante or the Jaguar or the Tesla and how they will depreciate over the next three to five years.  We also don’t know how they are going to depreciate in relation to the competing vehicles that have a solid track record.

If you lease the vehicle, you’re allowing the leasing company to share in that risk with you and this is what many people don’t think about.  They only look at the monthly payment or that they don’t want to lease a vehicle compared to purchasing a vehicle because some financial guru, who knows nothing about cars, told them not to lease.  They are not looking at the overall risk and costs involved.
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John Boyd

Auto Consultant – John Boyd: The Cool Car Guy
John is an auto consultant with his license at a car dealership in Denver, Colorado. He can help you save time and money on any make or model, new or used, lease or purchase – nationwide! Call or email John about your next vehicle! jboyd@coolcarguy.com or Twitter @coolcarguy

How To Lower Your Car Payments

home-buyerHey Cool Car Fans,

Many times people will decide that they want to purchase a home, but their debt to income ratio is too high.  They may have a great job and the income and they have even saved for a down payment, but their car payments are preventing them from being able to purchase a home.

There are some creative ways to lower a person’s car payments that can really help with their debt to income ratio and allow them to qualify for a home loan.  I have a good friend and client, who is a mortgage banker and he will routinely call me throughout the year and ask me to assist one of his clients to qualify for a mortgage by lowering their car payments.  There are a number of ways that we can do this to make it happen for people and allow them to take advantage of a home mortgage situation.

2012qx56The first thing that we can do is refinance the person’s current vehicle and lease it back to them that can sometimes really lower their payments.  I recently had a client who was able to lower their payment on a 2012 Infiniti QX56 from over $800 a month down to $422 a month by leasing the vehicle, instead of continuing with her current payment structure.  Being able to lower her payments really helped her with cash flow based on her financial situation.

Many people have lifestyle changes and they don’t look at this as an option.  For example, if a person can lease a vehicle and have a lower payment than they have money available for qualifying for a home or funding an investment grade cash value life insurance policy.  This can be a great strategy that will allow someone to put money away that they can use for other funding options.

lifeinsurancepolicyAs a licensed life insurance agent in the State of Colorado I can show people how to leverage the benefits of dividend paying whole life insurance from a mutual life insurance company.  One of the tremendous benefits of these products is that a person can invest in a policy, have a death benefit and build cash value to borrow against in the future for opportunities like financing their own vehicles without credit and at really low interest rates.  There are huge benefits to this strategy that I won’t go into detail here, but it’s an example of how if you can lower your car payments you can have other financial opportunities available to you.

I’ve had a number of people who have refinanced their vehicles by either financing or leasing them to lower their payments, but another option is to trade out of the current vehicle and into another vehicle.  This is another strategy that many people don’t think about and they miss out on a way better financial opportunity.

400For example, many people are told by the television and radio “financial gurus” never to lease a vehicle, but what if you have an opportunity to buy a home at a great price?  Let’s hypothetically say that you have a $600 a month car payment that is holding you back from qualifying for a home, but you only need $200 more a month in cash flow and you would qualify for the purchase.  What if you could get out of it, lease something similar in a different brand and have a $400 a month payment for three years with miles that would work for you?  That’s $2,400 a year, which over three years is $7,200 in savings.  This is money you can use for other opportunities or save for the future.

Let’s assume that you are $4,000 upside down though to get out of your $600 a month payment?  That is still $3,200 in savings over three years with much better cash flow, when you subtract the $4,000 from the $7,200.  This is what many people don’t think about.  What if you are able to purchase a home for $10,000 less because of the market in your particular area and you can now do that because of your improved cash flow?   Suddenly, that $4,000 in negative equity on the vehicle that you rolled into a lease makes perfect financial sense because you immediately saved $10,000 on the home purchase.  Over three years, the home you purchased is probably going to appreciate in value as well.

“Typically in the U.S., property prices rise 3.5 percent per year, Humphries says, and since about the middle of 2013, they’ve gone up 6 to 8 percent a year.” – Source: USNews.com

“The median home value in the United States is $189,400. United States home values have gone up 5.5% over the past year and Zillow predicts they will rise 2.9% within the next year.” – Source: Zillow.com

This is just one example of how it can make sense to lower your payments using a lease, trading out of a vehicle and purchasing or leasing a different vehicle or even doing a refinance for better cash flow.  As I mentioned already, I also show people how to use this type of a strategy to put the additional savings into an investment grade cash value life insurance product that also goes on the asset side of a balance sheet.  This can allow a person to put money away over three to five years and begin building a stronger financial foundation for themselves.

The bottom line is that sometimes it can make more sense to finance or lease a vehicle and lower payments depending on a person’s unique financial situation.  Everyone’s situation is different and people have life changes, including divorce, health concerns, retirement, credit challenges or opportunities that they want to take advantage of, so I have found that there is rarely a one-size fits all solution.

It’s honestly never a cut and dry statement such as “you should never lease a vehicle” or “you should never refinance a vehicle” or “you should never buy whole life insurance” like so many of the “financial gurus” like to claim.  Sometimes it makes perfect sense.  I’ve seen many people really improve their financial situation by restructuring their automobiles and the way that they go about financing or leasing them.

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John Boyd

Auto Consultant – John Boyd: The Cool Car Guy

John is an auto consultant with his license at a car dealership in Denver, Colorado. He can help you save time and money on any make or model, new or used, lease or purchase – nationwide! Call or email John about your next vehicle! jboyd@coolcarguy.com or Twitter @coolcarguy

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