Factors causing Japanese RV8 owners to send their
cars to auction
Colin Shea explains some of the
economic and social factors which influence Japanese owners of classic
cars like the RV8 to send their "ageing" car to auction
from which they are generally exported to the UK or Australia. The
flow of RV8s to auction in Japan is a key factor in the supply and
demand balance in the RV8 markets in the UK and Australia so is
inevitably of interest to RV8 enthusiasts there.
The cultural and economic factors in Japan and the effect they tend
to have on a Japanese owner's attitude to continuing to own and
run an "ageing" sports car like an RV8 are significantly
different to those in Australia and the UK,. As most of the RV8s
going through auctions in Japan go those countries, enthusiasts
there need to understand why the flow of RV8s to auction exists
and the prospects for it continuing. It is clear the flow over the
last few years has been substantial and that the effect on both
the supply and price of RV8s in Australia and the UK has been substantial.
Most observers would accept that the prices of reimported RV8s in
the UK over recent years have represented extraordinary value in
terms of the quality of the model - both the inherent quality of
the RV8 specification and the high quality of the condition of many
of the cars exported from Japan. So what are these factors and what
are their likely effects so far as present and prospective RV8 enthusiasts
in Australia and the UK are concerned?
Let's look at the use of cars in Japan and the costs of
owning a car in Japan.
1764 in the yard shortly after passing through an auction and
destined for export to an enthusiast in the UK.
Less use of cars in Japan
With superb and inexpensive cars, beautiful countryside and perfectly
maintained major roads you might think it would make Japan a motorist's
paradise. Unfortunately as land is scarce in the inhabitable areas
of Japan this leads to large crowded cities and dormitory areas some
considerable distance from major cities. So the reality tends to be
congested urban areas and costly toll roads which take the fun out
of long distance motoring and commuting by car. Holiday schedules
are tight with short vacations and traffic jams of longer than 100km
on toll highways are common during major holidays like the Golden
Week, Obon and the New Year. Even potable toilets for use in the car
are a necessary accessory when faced with such congestion! The efficient
rail and subway transport systems are
preferred for daily commuting and the Shinkansen (bullet train) takes
care of more serious, long distance travel needs.
Cars are generally well cared for
The condition of cars in Japan tends to be very good as they tend
to be used less in Japan than in other countries and suffer less abuse
in the hands of Japanese owners. Washing and waxing cars is done with
a quasi religious fervour and even in modest income districts one
can hardly find any neglected vehicles. Most cars, even highly tuned
performance cars or sports utility vehicles, are never used to their
full potential and spend their entire life in extended local neighbourhood
and urban use together with much time proudly displayed on domestic
courtyards. That good quality (condition and lower than average mileages)
is further enhanced because cars manufactured in Japan and intended
for the domestic market are always designed to higher specifications
than export versions. In the case of the RV8, there was a higher specification
for the models supplied to the Japanese market which included air-conditioning.
That feature is particularly popular with Australian RV8 enthusiasts
because of their hot summers.
Brand new is good, but used is not
In Japan there is a serious stigma attached to using or acquiring
anything "used". This originates from ancient beliefs and
it still affects all commodities including home appliances, automobiles
and even houses! Purchasing a new home in Japan, for example, will
inevitably result in its value shrinking by about 30% in the first
five years and it will be considered equivalent to zero in 15 to 20
years. A similar attitude to cars exists.
Even with the current economic slowdown and the newly acquired Japanese
taste for bargains, the
large majority of
vehicles is still acquired as a new vehicle from a dealer.
This is done by trading in a current vehicle, usually at Shaken renewal
time - this is a serious MOT type test required after three, five,
seven an nine years from new. Private car sales are non existent in
Japan because they are technically impossible. To pass from one owner
to the next, the vehicle must pass through the hands of an authorised
dealer or auction.
Woodcote Green 1009 in the yard after passing
though an auction in Japan.
Constraints on performance cars
Strictly enforced speed limits of 40km/hr in urban areas and 100km/hr
on toll roads mean performance cars like the RV8 are very rarely used
at even modestly brisk speeds. The consequence is low mileage, immaculate
vehicles which have been mainly been shown around by their proud owners.
Car theft is virtually unknown in Japan and alarm systems are rare
on Japanese cars. On the other hand, features such as power steering,
electric windows and mirrors, climate control, and car stereo systems
are considered standard equipment. In recent years, owners of luxury
or high performance cars like the RV8 have had little chance of
enjoying their capabilities on Japanese roads and are most often
recommended for export. Early depreciation is intense and this type
of car commonly loses as much as 40% of the original value within
the first three years.
Emphasis on production and consumption
Fierce competition between manufacturers and the introduction of
new models every four years results in strong incentives for new
car buyers. The vitality of the Japanese economy depends on maintaining
consumer appetite for its new products. Anyone with an ID, a job
guarantor can drive any new car out of the showroom with a zero
downpayment and loan finance for the full purchase price rates typically
of 6% to 7% pa. In other words purchasing a new car is relatively
cheap whilst owning is not.
What are the costs of owning a
car in Japan?
The costs of running a car are:
tax ranges from Yen40,000 (£240) for ordinary cars up
to Yen70,000 (£420) for luxury vehicles.
Shaken renewal - this is a serious test (a super MOT in UK
terms) which costs at least Yen120,000 (£720) not including
any essential repairs or replacement items necessary to pass the
test. The Shaken test is every two years after the initial three
years from purchase from new - that is at year three, five, seven,
none and so on.
Nightfire Red 1218 in the yard after passing through an
auction in Japan.
Parking - the typical monthly fee would amount to Yen10,000
to Yen50,000 (£60 to £300) depending on the urban area.
A parking space within a few hundred metres of an owner's house is
a mandatory requirement if you wish to purchase a car. The police
will come round to verify the size and location of that parking space!
Insurance premium, other than the basic cost of the Shaken,
amounts to at least Yen10,000 (£60) a month or £720 a
General maintenance and repairs are never undertaken by the
owner himself but by a dealer at a high price. Services, labour, rents
and advertising costs are very costly in Japan.
The major factor behind the rapidly falling car values and the tendency
to early replacement is the Shaken. Besides providing a huge income
for the government, it ensures every motor vehicle on Japanese roads
is safe and sound. As the
Woodcote Green 1698 - the auction condition sheet.
Red 2186 passing through an auction in Japan
Shaken price is the same at each renewal, the aggregate cost will
eventually amount to more than the value of the car itself. This
explains why only an "eccentric person" would consider
keeping a car longer than seven or nine years, regardless of its
condition. The large majority of these artificially depreciated
vehicles is sold at various auctions in Japan and exported to the
rest of the World at a rate currently over 30,000 units a month.
Woodcote Green 1698 passing through an auction - a typical
photo received from Colin Shea.
reports of RV8s appearing at auctions in Japan, see our webpage
with news from the RV8 Auctions in