Fractional Ownership News

Fractional Car Clubs The Answer To The Recession

The concept of shared usage of supercars — from $150,000 Ferraris to $500,000 Mercedes SLR McLarens — is based on a rarefied version of austerity. After all, paying $30,000 or more for an annual club membership is certainly more financially prudent than actually buying one of these cars, which for the most part depreciate drastically as soon as they leave the showroom.

There are several fractional car clubs that give their members access to supercars and high-performance sports cars for a specified number of days (depending on membership level), and some of the clubs said that the hard times cut both ways. “The recession has hit the whole car industry, including our business,” said Rick Gaan, who operates Club Sportiva, based in Northern California and begun in 2003. “Things are starting to settle down, but people are a little more gun-shy, a little more careful these days. On the positive side, when they study the value proposition they say these are weekend cars anyway, so they might as well timeshare them.”

Mr. Gaan, whose collection includes not only top-dollar cars like the Ferrari F430 and the Aston Martin DB9 Volante, but also more everyday drivers like a Porsche Cayman S and a Shelby GT, said he was still signing up customers at a steady rate. But some of the 120 members have been forced by the economy to “throttle back” to, say, 40 days of membership, from 60. Nonetheless, he intends to expand north into wine country. Club Sportiva also rents a few of its cars on a daily basis (Ferrari F355 Spider, anyone?) offering a more affordable version of the experience.

The Vulcan Motor Club, based in New Jersey, owns a dozen supercars, including a Tesla Roadster and a Ford GT40. Vulcan has about 100 members and annual memberships that cost up to $35,000. The founders, Aaron Fessler and Tom Mizzone, are serial entrepreneurs rather than hard-core car enthusiasts, and they began the business in 2007 because they saw an opportunity. Despite the economy, Vulcan has opened a second outlet in Glen Cove, N.Y.

Mr. Fessler said he noticed that the high price of exotics was followed by a precipitous drop of $50,000 to $60,000 once they had 100 miles on them. “For many people, and especially in this climate, it’s hard to justify that expense,” he said. “And people are time-sharing everything else, from yachts to watches, so why not cars?”

The Classic Car Club, which opened in London in 1995, is also shaking off the recession blues. A Manhattan base opened in 2005, and the club plans to expand soon into Los Angeles and Miami. The fleet has a Bentley GTC and classics like a Triumph TR6. According to Zac Moseley, a club director, annual dues are $8,000 to $25,000.

“The economy is tough on everybody, but some people use access to our cars as a replacement for actually owning any type of vehicle,” Mr. Moseley said.

wheels.blogs.nytimes.com

16/07/2009