Three years ago, Torbin Fuller, a long-time classic car fan, quit his job in finance at Ford, moved from Dearborn, Mich., to San Francisco -- "because there's a lot of scenic driving there" -- and started a club that allows members to share the use of classic cars. How's that for a risky move?
At the time, America was just crawling out of a recession, and Silicon Valley was playing dead. So the idea of creating a club where people pay $3,195 to $8,495 annually to drive pricey cars for a few days a year didn't exactly sound like a vroom-vroom idea.
But Fuller's notion turned out to be a pedal-to-the-metal success. In March, 2003, he opened a 10,000-square-foot clubhouse -- complete with parquet floors, leather furniture, flat-screen TVs, and a huge window overlooking a garage with 12 cool cars, a fleet that has since expanded and includes a 1989 Rolls Royce Corniche II, a 1989 Ferrari 348 GTB, and a 1977 Aston Martin V8. Soon, members began trickling in.
A WHOLE NEW SEGMENT
Today, his Club Sportiva boasts a membership of nearly 200, up 50% year-over-year, and Fuller says it's profitable. A year ago, he opened a branch in San Jose, Calif. And now he's plotting a nationwide rollout -- a move likely to be copied by several other exclusive car clubs, which have cropped up since Club Sportiva's launch.
All these outfits -- which follow similar collector car clubs in Britain -- want to become the auto industry's version of the popular jet- and yacht-sharing clubs. (See BW, 9/15/03, "Time-Share Yachting"). Club Sportiva will enter five new cities outside of California in 2006, then expand to a total of 25 locations within the next three to four years, Fuller says. Another club, Van Horssen Group in Scottsdale, Ariz., plans to open 22 locations within three years. "We think we'll be a whole new industry segment," says Ron Van Horssen, the club's CEO.
The beauty of these nationwide networks is that they'll allow members living, say, in New York to use their points or driving days on a business trip to Florida, the same way a member of a health club network might be able to use the gym in any location. You simply come in, show your membership card, and drive away in a cool ride (see BW Online Slide Show, "Cars to Get Your Heart Racing").
WHAT SHARERS CRAVE
And these clubs could potentially serve much greater areas than just where they're located. Van Horssen Group, whose first club opened in Scottsdale in early 2005, already delivers cars directly to members in California. You let the club know what car you want and when, and it shows up at your door.
The idea is taking off, and why not? "The last, very big [sharing] market is cars," says Phil Kavanagh, co-founder of Britain's Classic Car Club, which has spawned Classic Car Club Manhattan and is planning to expand to 30 locations within five to seven years. Already, on the low end, outfits like Flexcar offer members the use of their fleets parked around cities like Seattle and Washington, D.C., for a $40 annual membership fee, plus hourly use rates. But Flexcar is offering Hondas, not Ferraris. And it's Ferraris that some sharers crave (see BW Online, 12/16/05, "Putting a Fresh Face on a Ferrari").
Who are they? Residents of the Big Apple, for example, where owning a car might not be practical. "Our building doesn't have a garage, so the ability to use the car club was perfect for us," says Dan Cordeiro, managing director of real-estate marketer Corcoran Group Marketing, which markets a condo complex near Classic Car Club Manhattan. The complex' developers recently purchased complimentary one-year memberships for all of their buyers.
And nationally, there's a growing base of young professionals that's making good money and "affluent baby boomers who can live their fantasies through such clubs," says Jack Plunkett, founder of market consultancy Plunkett Research in Houston.
Expensive as they are, car clubs allow members to afford pricey toys they might not be able to buy on their own. A Ferrari 360 Spider (400 horsepower, capable of 185 miles an hour) like the one Club Sportiva owns sells for about $200,000, according to a Ferrari dealer.
Even buying some of these cars can be a headache: Club Sportiva had to go through a broker to find its rare Morgan Plus 8 roadster. The auto's manufacturer puts out just several hundred of these handcrafted cars a year. The Plus 8 sells for about $55,000, says Bill Fink, president of Isis Imports, a Morgan dealer in San Francisco.
STOP AND STARE
A car owner also incurs other expenses that a club member doesn't. Back when Fuller owned a '82 Ferrari, which he sold to start his club, he ended up paying $10,000 a year in maintenance, plus parking and the hefty insurance. Comparatively, several thousand dollars a year in membership isn't that much. And you get to enjoy all the perks of ownership: "When I'm on the road in the Jag or the Morgan, people just come up to me to talk about the car," says Randy Bunkley, a 33-year-old Club Sportiva member who personally owns a much more practical Mercedes SUV.
When Bunkley, who's a senior manager at an accounting firm, drives the Morgan, which looks like something out of a 1930s movie, he says cars in front of him would often pull to the side and let him pass, just to watch the car go by. Once, a policeman stopped by his side, just to find out his car's make.
Benefits of club memberships typically extend far beyond the driving experience. Bunkley says he tends to spend a couple of nights a month at the clubhouse, attending member dinners and watching car races. "I met most of my best friends through the club," he says. Several times a year, most clubs run trips: Last Labor Day, Van Horssen members went on a fly-fishing and driving trip to Montana. And Club Sportiva plans to take its members to a local track to race their cars and get tips from professional racing instructors.
To further increase their attraction in light of mounting competition, several clubs are readying major marketing pushes. Classic Car Club Manhattan, plans to open locations in San Francisco, Los Angeles, and Miami next year, has it recently put out its first short film, Join the Club. In it, a female passenger in fishnet stockings looks ecstatic as her car's driver speeds through the night. At a particularly sharp turn, tires screech, and she loses her high-heel shoe.
"People think of a classic car club as boring guys in tweed jackets," explains Brandon Jameson, the film's creator. "We're selling the idea of bad boys who like to have fun. The unspoken here is that cool cars pull hot chicks." Alas, few women join the car clubs so far. But perhaps that will change as this tiny new industry takes off.