New federal regulations make it easier to build and buy classic car replicas

[twobjshelbys]

I think the whole thing is academic. The entire process was created started at a time when the potential existed for a fairly good sized market, but that market was in fact fixed and small and declining, and not capable of supporting a large number of manufactures, even for some vehicles, only one.

Since then the consumer pool has shrunk. Let's face it, 20 year olds aren't interested in Cobras, and most of the people here while they love their Cobras, aren't going to be willing to spend the money on a fully compliant turnkey car. A roller + power train from even the cheapest kit will now approach 100K. A fully completed car with warrantied power train and the builder/dealer overhead will realistically approach 200k.

The TAM for this kind of car in fiberglass is practically nil. Why? Because you can get a Kirkham roller and finish it for the same price.

The TAM is fixed and very small for a price point in the 200K range. Get all of the current viable Cobra kit makers in the market and none of them will make enough to make it a profitable venture. If they do attrition will take care of supply vs demand quickly.

I don't think there will be more than a handful of participants and their volumes will no where approach the limits.

Kit Cobras will continue to be popular. But the TAM (Total Available Market) for them decreases daily as the TAM ages.

Like I said, a status report in a year will tell what really is happening.

[Mark IV]

Originally Posted by twobjshelbys

I think the whole thing is academic. The entire process was created started at a time when the potential existed for a fairly good sized market, but that market was in fact fixed and small and declining, and not capable of supporting a large number of manufactures, even for some vehicles, only one.

Since then the consumer pool has shrunk. Let's face it, 20 year olds aren't interested in Cobras, and most of the people here while they love their Cobras, aren't going to be willing to spend the money on a fully compliant turnkey car. A roller + power train from even the cheapest kit will now approach 100K. A fully completed car with warrantied power train and the builder/dealer overhead will realistically approach 200k.

The TAM for this kind of car in fiberglass is practically nil. Why? Because you can get a Kirkham roller and finish it for the same price.

The TAM is fixed and very small for a price point in the 200K range. Get all of the current viable Cobra kit makers in the market and none of them will make enough to make it a profitable venture. If they do attrition will take care of supply vs demand quickly.

I don't think there will be more than a handful of participants and their volumes will no where approach the limits.

Kit Cobras will continue to be popular. But the TAM (Total Available Market) for them decreases daily as the TAM ages.

Like I said, a status report in a year will tell what really is happening.

The TAM may not 325 units, it may not be 200, it may only be 50 (BTW, the original proposal was for 500 units per manufacturer, but it was opposed. Guess by who? GM! Like the extra 175 was gonna cut into their share!)

The market for these "turn-key" cars is the disposable income buyer who:

1) Sees a car, wants it and lays the money down, instant gratification

2) Wants a car, but doesn't want to deal with the build-out, registration process, etc.

3) Needs to finance with the car as collateral, something with very limited sources now as most banks assign NO value to a car who's VIN doesn't show in the system

4) Wants a "real" car (I know, this is a stretch) with a warranty and some sort of support

There IS a market. Is it huge? No. Does it exist? Yes.

[twobjshelbys]

Originally Posted by Mark IV

There IS a market. Is it huge? No. Does it exist? Yes.

Yes, there is no doubt there is a market but is it even close to the numbers that make it economically viable? Noone is going to enter the market for 1 turnkey car - the cost would be prohibitive. What is the materials cost + amortized overhead costs (like warranty reserves) that make it viable? Is it 10? 20? 50? It all depends on how much they can buy the roller for. Now Superformance makes their own so they get it at "transfer cost". Then add the power train cost (probably discounted over a street engine but still not half), and add the amortized fees and then add 20+% profit. Can you sell one with those constraints for 200K-ish? Maybe, but only if the numbers allow you to divide the other costs over enough volume. Then, if others jump into the pool, the TAM isn't additive - each manufacturer doing it divides the TAM up, so the volumes per manufacturer go down.

I really don't see room for more than one, maybe two, manufacturers in the Cobra space and that dwindles over time with the aging of the interested population.

Time will tell...