#3 - Too Much of a Good Thing
As a supercar manufacturer, I imagine you often find yourself juggling a plethora of contradictory production objectives when building and designing a new car. Make it as fast and desirable as possible whilst sticking to budget, maximise per unit production profitability yet make sure only a limited number are produced to maintain exclusivity. Trying to tick all the boxes must be akin to wrestling a grizzly bear whilst changing a light bulb. But the real problem arises when you actually achieve all the objectives. You see, us Brits are very bad at knowing when to stop….so allow me to introduce you to a little known sportscar firm known as McLaren.
When McLaren returned from automotive hibernation in 2011 with the MP4-12C everyone got pretty excited….and rightly so. It was a corker of a car and a true twin turbo’d flip of the bird to the likes of Ferrari and a lesser extent Lamborghini who had been dictating the supercar market in a relatively unmolested manner over the previous decade. And with the success came more models to fill out the company’s Sports, Super and Ultimate series strategy culminating in the launch of the spiritual successor to the McLaren F1 in 2013, the P1. However, they weren’t done there and 2 years later the flagship of the Super series range was launched, the McLaren 675LT.
Now the name alone created big boots for the LT to fill. It was like calling your son Stirling or if you were Italian, GTO and it brought with it great expectations. Indeed the LT nomenclature harked back to the Mclaren F1 “Long Tail” GT race cars of the 90s……no pressure then. But in typical McLaren fashion, they nailed it. A heavily reworked, lightweight track version of the 650S, it obliterated pretty much anything and everything that Stuttgart, Maranello or anywhere else for that matter could throw in its path.
Naturally a Spider version followed along with the McLaren skunkwork division, MSO, releasing several more limited edition models including the Carbon Series and HS. So by now you are probably thinking “jobs a gooden”, “great success, come back in 10years with another one”…… but that’s where it all went a bit Pete Tong. In short, McLaren over cooked it.
Currently, if you wanted to purchase a new McLaren super/hypercar, your choice of options is as exhaustive as going to Ford to pick out a Fiesta. Do you want a Senna, a Speedtail, a GT, a 720S or a 600LT…..the list goes on. Now for the record, every one of these cars is and will be absolutely stupendous. This is not a critique over any of them. However, the problem McLaren have inadvertently created is by making so many brilliant and capable cars in such close succession, they have diluted the “specialness” of each of them. At least when you buy a limited edition Ferrari or Porsche you know it will not be usurped by another limited edition model 10 minutes later and if it is, there is enough of a product differentiation between the 2 to let you sleep peacefully at night. With a McLaren, it’s quite possible that a month after you have taken delivery of your brand new Macca, it has been upstage by another one…..this time with more carbon bits and a louder exhaust.
Now at this stage, the philistines can rightly claim these are first world problems associated with the ownership of supercars and we can’t disagree with them. However, from an investment perspective, it does pose a headache. Right now there is a 2016, sub 1,000 miles example of a 675LT (pretty much brand new) offered for less than £200k. 2 years ago, the same car would probably have been offered with a £300k+ price tag. Run the same search today on a Ferrari 458 Speciale and I find a 2015 car with similar miles offered at £335k…..Queue the head scratching.
The 675LT is the objectively better car out of the 2….any road test review will tell you the same. However, subjectively and as an investment, the market clearly has more faith that Ferrari will hold firm to their ethos of not over juicing their limited edition models. So the question really becomes does it warrant the £100k+ spread between the 2 cars? In our view, absolutely not.
Yes there is a 720 version of the LT to appear in the very near future and yes its baby brother the 600LT is a monumentally capable car, but the move in 675LT prices is overdone and at these levels, I think we actually see a bounce in 675 prices as the market gets wise to this price dispersion. It’s the original LT model to come out of McLaren Automotive’s rebirth and that’s worth a lot. So if you are considering buying a Speciale at the moment, mazel tov, but I would take a long hard look at the 675LT…..it’s where my money would be going.
Happy Motoring,
CC’s Investment Team