Friday, August 17, 2012

AUTOMOBILE DIMINISHED VALUE IN FLORIDA - DO ANTIQUE, CLASSIC AND CUSTOM CARS QUALIFY? JUST ASK THIS 1967 PLYMOUTH BARRACUDA.

1967 Plymouth Barracuda
A UNIQUE AUTOMOBILE DIMINISHED VALUE APPRAISAL 

GAINESVILLE, Florida - Automobile Diminished Value, as many Florida insurance consumers have learned, occurs the instant a late-model motor vehicle is involved in a collision and subsequently repaired. Regardless of how minor the damage was, and no matter that the body shop did a great job, because of the well known CARFAX vehicle history report, the car is now worth less. Come time to sell or trade-in your late-model car, prepare for the used car manager at the dealership to knock thousands of dollars from the fair market value. Vehicles most severely impacted are newer cars and, of course, high end vehicles like BMW, Mercedez-Benz, Porsche, Land Rover, etc. In Florida, we can recover that difference in value by filing an Automobile Diminished Value claim against the at-fault driver's insurance company along with an appraisal.  But antique cars aren't even included in the CARFAX database so how did a classic 1967 Plymouth Barracuda wind up in an Automobile Diminished Value dispute? Ever hear of a Mopar 340 motor?

For those in the know, the iconic Mopar 340 Cubic Inch racing engine wasn't available until 1968 but when it appeared on the track it took the racing world by storm. Over the years these motors were practically raced out of existence and now it is easier to find a rare 426 Cubic Inch motor than it is to obtain a fresh 340. It was with great anticipation that the man from Central Florida dropped his modified, factory-bored 340 engine into his 1967 Cuda. And it was enjoyable to feel the extra power as he drove the highways and back roads around Gainesville, Ocala and Palatka.

One day the man from Central Florida brought his car to a mechanic who, according to the vehicle owner, improperly repaired the 340 motor which ended up destroying the block. Since no like, kind and quality engine is available, his only recourse will be to use a different motor, either a bored out 318 or a 360 truck motor being the most likely candidates. After the job is done, will the 1967 Barracuda be worth as much as it was before? As it turns out, the answer is no.

"I think that putting a modified 318 in place of the 340 would probably reduce the value.  I'm a believer in building the 318 because these engines can deliver a lot of power for relatively low cost.  However, something about a 340 really turns people on psychologically.  So, therein lies the extra value."

That comment is typical of how a Mopar afficianado feels about the 340 motor. Here are the results of my Automobile Diminished Value report using a Fair Market Value of $25,000 provided by the vehicle owner.

DIMINISHED VALUE RESEARCH

I received this assignment to prepare a Diminished Value report on 08/09/2012. The above captioned vehicle was damaged in December 2010. It did sustain major engine damage According to the vehicle owner, a mechanic performed unauthorized and improper repairs to the motor that damaged it beyond repair or redemption. The car was equipped with a factory-bored 340 motor which is as rare as it is desirable. There is virtually no way to replace this motor and no other engine configuration would provide the same desirability as a fresh 340. There are 340s out there but none that wouldn’t require a trip to the machine shop which defeats the purpose. Due to the resultant damages and the unavailability of a like, kind and quality motor, there is a decrease in the vehicle’s Fair Market Value.

The Mopar 340 engine was an iconic high performance motor that has become more difficult to find with the passage of time. Mopar aficionados pay a premium for vehicles equipped with original factory-bored 340s regardless of whether it was original equipment or not.

One of the best engines of the 1960s and 1970s for performance enthusiasts was the 340 V-8. It had high-flow heads, big ports, a two-level intake manifold, and a six-barrel option (three two-barrel carbs). The package allowed for high speed with the light weight helping handling.

 ·        Brad of Mopar Dude Auto, Burlington, KS, 620-364-8200  stated that the Diminished Value would be negligible, in the 10% range. He said that one could find a 426 (extremely rare motor) before he would find a good 340.

·        Ramon of Ramon’s Mopar Cars & Parts, Burneyville, OK, 580-276-9958 stated that the engine difference does make a big difference which he estimates to be 25% of the value of the car.

·        Jim McGee of Mopar Alley, Kingsport, TN, 423-817-2839 stated that the dimunition of value as a result of the difference in engines is as much as 50% of the car’s value.

·        Jason Muckala of MOTECH Performance, Murrieta, CA, 951-813-3550 stated that there would be a 30% reduction in value because of the difference in engines.

·        Owd Kasd, Senior Member of For A Bodies Only Mopar Forum has stated that the diminished value as a result of the engine difference could be from 25%-50% which averages 37%. He went on to write that “The 340 has a lot of pull for buyers.”


Other comments:

Mopar410: I agree. Just the word 340 opens people’s eyes. When they hear 318 the first thought is “Oh, OK.” There is a stigma about small-block Mopars. The 340 was a performance engine (for good reason) and the 360 was just a truck motor. These views aren’t mine but what I have experienced thru the years.

273: You probably get around the same price but the 340 would make a quicker sale cause what would you rather have a 340 car or a 318 car?

Adam R: The 340 would be worth more because it’s a more "desirable" motor. How much more depends on the buyer.

The average of five (5) deductions is 30.00%. This is the percentage of Diminished Value to be taken from the FMV at the time of loss.

PRE-LOSS FAIR MARKET VALUE (As per vehicle owner)  $25,000.00             
                                                  
DIMINISHED VALUE (30.00%)  $  7,500.00

So after preparing hundreds of Automobile Diminished Value appraisals on late-model bad CARFAX cars and the aforementioned BMWs, Mercedes-Benz, Porsches and Land Rovers throughout Florida, I finally got a really cool assignment. The misdeeds of mechanics and a rarity of replacement parts contributed to a unique Diminished Value scenario involving a 1967 Plymouth Barracuda and the star of the show, a Mopar Factory-bored 340 Cubic Inch motor. So can there be cases of Automobile Diminished Value in antique, classic and custom cars? You bet.

The St. Lucie Appraisal Company
P.O. Box 2700
Fort Pierce, FL 34954
Phone: (772) 359-4300
Fax: (772) 466-8400
Email: contact@stlucieappraisal.net

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