Why Chrome Temple is investing in speed
As cars get quieter and more politically correct, Aussie investors are pouring cash into the vehicles that adorned bedroom walls in the nineties.
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Sitting in a classic Ferrari is more fun than sitting on a share portfolio.
The smell of its leather trim, the cold feel of its steel gearknob, and the soft green glow of its driver instruments are a feast for the senses – even if you don’t take it for a spin.
And a band of revhead investors is betting that a classic car portfolio could deliver some intoxicating returns in coming years.
Rather than investing in cryptocurrency, shares or property, Sydney-based private equity fund Chrome Temple is gambling on the future of poster cars that adorned bedroom walls around the world.
It’s a unique approach that has attracted like-minded petrolheads, including those who don’t have a spare $1,000,000 to buy and store exotic cars.
Lex Pedersen, chief executive for Chrome Temple, said collectable car prices were increasing as cars became green.
“We invest in vehicles of significance as opposed to equities, cryptocurrencies or other traditional investment forms, because what we’re seeing with the hybridisation or electrification of cars, the capacity to make these analog driving machines as come to an end.
“We’ve come to the beginning of the next automotive revolution … these vehicles that are so dear to our heart, these analog machines within internal combustion engines that are no longer in production.
“There’s no better way to drive demand for an asset and tell someone they can no longer have it and essentially that’s what’s happening in the automotive industry right now.”
Increasingly strict regulations surrounding emissions, noise, and mandatory safety equipment are changing the way cars drive. Combustion-powered vehicles have been banned from sale by some countries in the next decade, and the European Union looks set to introduce mandatory speed limiters in the medium term.
Which means the supercars of tomorrow will not be like the supercars of today – or yesterday.
Rather than investing in cars that earned classic status decades ago – such as a Jaguar E-Type or Aston Martin DB5 – the fund focuses on cars idolised by children of the 1990s.
Cars such as the Lamborghini Diablo or Ferrari F355.
And the Nissan Skyline GT-R.
Chrome Temple has paid an undisclosed seven-figure sum for an incredibly rare Nissan built to race in the Bathurst 1000, believing its value will continue to climb.
Pedersen said the Group A Nissan GT-R was “a sound investment”.
“It’s been a million-dollar car for some time, how many millions is really the question for something like this.
“There’s emotional value and there’s scarcity with only five being built – one was written off.”
Alan Heaphy, former team manager for Nissan Motorsport Australia, said the locally developed GT-Rs, nicknamed Godzilla by motorsport fans, were “the best in the world”.
“Out of the box, the Nissan GTR was a weapon,” Heaphy said.
“Our task was to make it unbeatable.”
The Group A GT-R is a magnificent machine to behold, with exquisite details that speak to its single-minded purpose.
Which is just as well, because investors in the fund are unlikely to drive it – the cars are intended to be investments, not toys.
Originally published as Why Chrome Temple is investing in speed
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