What should a restoration cost?
Well first let's deal with some quaint notions about this.
Quaint notion #1: Gee, I'm tinkin' of buyin' dis car for (X amount of money), havin' yooz restore it for me, and den I'm gonna sell it for (Y amount of money) and make a profit!" Rather than address the foolishness of this belief for its merits, I will dispense with it in this way: If it were possible for someone to buy a car, have me restore it in such a way that I make a profit, and then sell the car for an additional profit, then I'm going to buy this car, I'm going to restore it at my cost and I'm going to sell it and I'm going to make that profit! In fact, if this were routinely possible, I would never deal with another customer again!
I know of a restorer, who has two retired militaries driving all around the country, buying old cars they see on back roads and in small towns, never paying more than $500, then shipping them back to him. He then does quickie "restos" on them, and bangs them out to auctions. Under a different name, he sometimes makes a profit. He still deals extensively with customers! I think he does the spec stiff mostly to keep his large crew of minimum wage workers busy during slack periods. During the 80's, when Wall Street yuppies were buying "E" Type Jaguars for $70,000, restorers were doing ground up restoration from rusted frames found in junk yards and making huge profits! For those of you who have been asleep forthe last decade, that market crashed and now I could make a career out of re-restoring the junk that was pumped out during that era!
Quaint notion #2: My car is worth $12,000 restored, (according to 'Old Cars Price Guide') so it shouldn't cost more than $12,000 to restore it! The market value of classic, antique, vintage, or custom cars is affected by a lot of factors. Supply & demand, unusualness of design, original quality of manufacture, endorsement by some recognized agency (such as AACA) the phases of the moon, etc. Almost anything but the real cost of repairing it.
What should a restoration or a repair cost? Let's start with a stumble through a history lesson. IN 1971, a Lincoln Continental Mark IV, cost Ford $960 in parts and labor to manufacture. Teh car was sold retail for $12,000: $2,000 was the factory's profit, $2,000 was for administrative overhead, $2,000 was for advertising and $1,000 was for product liability insurance. Amusingly (or ironically) the actual cost of manufacture was the lease expensive item. This car was on an assembly line for approximately 7 hours and over 60 people (and in those days, only 3 robots) worked on it. Assuming that during that 7 hour period, the vehicle was being physicaally worked on only half of that time, simple multiplication says that it took 210 man hours to assemble that car. The parts for this car are manufactured or purchased by Ford by the 10,000 if not 100,000! Ever heard of a volume discount?
Now lets jump 25 years into the future. I picked this number, because a lot of people suffer from the mistaken notion that a car automatically becomes a "valuable" antinque at 25 years. Sorry about that! Stick with me long enough and I'll attack every notion you have ever acquired! A Continental Mark VII now sells for $42,000 retail. At least a decade of hyperinflation (in this country, 7-8%) has helped to expand that $960 to over $4,000! You want me to take your 1971 and restore it, so let's examine the physics of that. I don't have an assembly line, no restorer does. If you find one who does, please let me know so I can close up shop, there will be no way to compete with him! No, we have to do it the old fashioned way, by hand with small teams, like Rolls Royce used to. First, we have to disassemble the vehicle, something Ford didn't have to do. Would you like me to use an air wrench to speed it up? Oops, I just broke a stud off because the nut was rusted to it! Looks like I am going to have to spend an hour drilling and tappign it! Hmm, I guess I better move slower and try and do less damage! If only I could be like a collision guy and just zip, zip, zip it right apart!
So let's say this car is a good restoration candidate. So I only have to replace or repair for arguments sake 35% of the components. Guess what, I'm just like you, I have to buy almost every one of these parts retail. I'm not buying 10,000 at a pop, so we can forget the discount! The suppliers of antique car parts consists of junk yards, individual or small company rebuilders and a number of small companies that actually have in some quantity reproduction parts manufactured for them, usually in countries like Taiwan. All of these entities will deal directly with a customer as well as a professional restorer. Only some of the small companies offer discounts for a certain minimum annual volume. I, like a fool, generally pass that discount on to you. I suffer from the old-fashioned notion that in return for your business, I should reward you by allowing you access to my discounts. In fact, my real intention is, to discourage you from bringing in your own parts and expecting me to warranty them!
Let's get down to some actual numbers. Assuming you hae a good restoratino candidate, and I apologize for one more digression. I know you ar on the edge of your seat waiting for the numbers. A good restoration candidate would be a vehicle driven regularly for 5 years for about 50,000 miles. Then, stored in a well sealed garage for 20 years, being driven downtown say once a month. A vehicle driven 100,000 miles and stored outside for ten years but well maintained, would be somewhat less than a good candidate, but not necessarily a poor one. A vehicle with only 5,000 miles on it, but stored for 20 years under a pine tree, would not be a candidate at all, (I've seen 'em!) A vehicle with 100,000 miles on it and stored outside for ten years with a car cover on it will most likely be a poor candidate. Oops, I think I just stepped on another notion! I hope these are enought examples for you to see a trend.
A good restoration candidate is generally a very well kept vehicle, properly exercised and stored, very much better than average. Of the 95% of vehicles coming through my shop from the local area for what I described as simple repairs, not a single one was what I would consider a "good" restoartion candidate. That is why they were merely repaired. Most of the professional restorers in this country are located in either Florida or California. Why? Two reasons primarily, (1) the people in those places have much more disposable income than you and I, but particularly (2) the climate in those regions allows for very good restoration candidates.
But back to numbers. We are finding that the average good restoration candidate takes 350 man hours to completly restore. That's pretty good relative to the 210 mh Lincoln assembly sepecially considering there is disassembly time in that 350 figure. My general restoration rate is $30 per hour, $45 for the mechanical phase of it. The average for a typical restoration works out to $37 or so. Tha is probably near the lowest of any restoration shop anywhere in this country. I have heard that there is a guy in central Norht Carolina who charges $25 per hour. I also heard he hasn't been to a dentist in 20 years! Doing some simple math, the labor cost appears to be in the neighborhood of $12,950.
