According to an analysis by Black Book, it has emerged that the frequent appearance of luxury cars—both classic and modern—on social media sites such as Instagram have some direct influence on their resale value. When celebrities like David Beckham and Dwayne Wade post their photos on social sites that include their admirable luxury automobiles, whether classic or modern, people take note and react to them.
Social platforms provide a way to publicize luxury cars
Social networking can be linked to the craze seen among the younger generation of collectors that is taking over the genre of exotic cars, making the auction prices rise drastically. According to Eric Lawrence, the Black Book director of specialty, the well-off collectors see the images of luxury cars posted on social media by celebrities, which drives up the demand of the particular exotic cars.
The common trend is quite different from several decades ago, when exotic cars were reserved for the real stars, such as Roger Staubach, Frank Sinatra, and Marilyn Monroe. Moreover, the few who could afford the cars kept a low profile. Additionally, there were few media outlets for them to show off their prized possessions. However, nowadays, even the not-so-prominent basketball players can manage to buy a luxury car, like a Ferrari or Bentley, and thanks to social media, they can show off to all.
Eric Lawrence notes that consumption has become something to show off, and it is common, for example, to see someone post a picture of themselves on Instagram as they hit a golf ball from the roof of their luxury car, such as a Bentley.
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Economic recovery contributes to the growth of the vintage cars market
In the period between 1977 and 2008, the stars most common cars—the Aston Martin DB5 coupe, the Mercedes-Benz 300SL Gullwing, and the Ferrari 250 GTL—registered a rise in value by 5% each year. From 2008 onward, these cars have recorded an appreciation in value by as much as 60% each year.
According to McKeel Hagerty, the founder of Hagerty Insurance, which offers insurance coverage for classic and collectible cars, there are factors other than social media that influence the luxury car market. McKeel identifies the economic recovery after the financial depression as a significant factor causing the high growth in the vintage cars market. He adds that social media has also played a role in the extraordinary growth,as studies have shown automobile pictures being posted in big numbers on Facebook, coming after kids and pets.
New multimillionaires and the newly made industrialists are the users of social media
Eric Lawrence clarifies that the Black Book study capitalizes on trend forecasting and opinion evaluation by his team of experts. It is not lost on him that most of the older wealthy people do not use social media as much, so their findings mostly concern the new multimillionaires and upcoming industrialists, who form the second tier of the very affluent. The members of the group are the ones inclined to post things on social media or to be vulnerable to the “Instagram effect.”
The appreciation in the value of luxury cars and the growth in their production and purchases has registered an unprecedented upward trend, thanks to the massive amounts of money in circulation and the social media effect. New billionaires are emerging every year, and there is still room for more. Bearing in mind that the highly affluent like to flaunt their wealth—mostly through their cars—luxury cars will continue rising in value, and will be produced and sold in throngs.