Foreign Buyers Rev Up Market for L.A.’s Exotic Cars

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It’s pedal-to-the-metal time for L.A. brokers who ship rare and exotic cars to racing-gloved buyers in foreign lands.

As the dollar has fallen, foreign collectors and purveyors of exotic cars have been snatching up icons of L.A.’s car culture Ferraris, Lamborghinis and even Mercedes Benzes and BMWs for what they see as bargain prices.

“We’ve seen business jump 10 to 15 percent this year,” said Peter Gruettner, chief executive of Lakewood-based Extra Logistics LLC, a five-year-old freight forwarding company that specializes in shipping automobiles, motorcycles and even boats and motor homes. “It’s a good time to be in the export business.”

Gruettner said he’s seen more BMWs, Mercedes Benzes, Audis and Ferraris roll through his Compton warehouse in recent months than ever before.

“Despite the fact that shipping charges have more than doubled over the past eight years, buying a car here and shipping it back is often more economical,” he said. “They see it as getting a great car for a discount.”

Gruettner said that it costs anywhere from $2,000 to $5,000 to ship a car in a container overseas.

But that’s more than offset because the value of the dollar has sunk by more than a third since 2002. That makes a $300,000 car here seems like a $200,000 car to some foreign buyers.

“Even though the actual price of the cars hasn’t gone down, if you’re buying a $250,000 car and you’re getting a 30 percent discount due to the currency conversion, it’s still substantially cheaper to pay $2,500 in shipping and have the car sent to you,” Gruettner said.

Of course, he and other brokers charge a fee, which adds to the cost. And the shipping can take weeks, but the time-consuming process can still save a buyer tens of thousands of dollars.

“People are crazy about cars,” Gruettner said. “So while it may seem like a lot of work, the fact that they can save some money and get the car they’ve always wanted motivates them to pay someone to get it done.”

Gruettner ships mainly out of Los Angeles, but also out of ports in Houston, Miami and New York. He said demand for all types of expensive cars has spread from Europe to Asia and has forced him to hire additional staff workers. He’s also upgraded his company’s software allowing customers to track their cars and other purchases online.

Factory-authorized dealers often are prohibited from selling directly to buyers who intend to export. However, they can sell to a broker, and the broker can then legally re-sell it to a customer overseas.


Changing culture

Cars, especially expensive, rare and fast ones, are as much a part of L.A. culture as movies, traffic and Mexican food.

“Because of the amount of money here in L.A., it’s always been the first stop for all luxury goods especially cars,” said Sean Lee, with Rancho Dominguez-based Air Tiger Express USA Inc.

However, Lee said that because of the slumping economy in the region, many dealerships here are seeing their inventories balloon.

“When times were good, these people were leasing Bentleys and Mercedes Benzes like crazy,” Lee said. “Now that the economy has slowed, they realize they can’t afford them and the dealers now have a glut.”

That relative glut of exotics here has caught the attention of foreign buyers.

“Los Angeles has always been one of, if not the most prestigious car markets in the world,” said Tim Lappen, chairman of the family office group at L.A. law firm Jeffer Mangels Butler & Marmaro. One of his specialties is finding exotic items for his wealthy clients. “If you want an exotic car, there are few places that would have it if L.A. doesn’t.”

And it’s not just the rich of Europe and Asia buyers in countries with emerging economies are also getting in the action.

“We’re seeing huge growth in demand from countries with booming wealth,” said William Sayre, a car specialist and exotic car broker for the Mint Driven division of L.A.-based lifestyle concierge service Mint.

“China, the Middle East have grown a lot but most of all Russia,” he said. “We created the division out of pure necessity.”

L.A.-based Mint plans to open offices in China, Dubai and Russia by the end of next year to follow the demand of the & #252;ber rich to fill their gasoline-fueled desires.

And demand hasn’t just set on exotic imported cars classic American muscle cars are also being bought at red-line speeds sometimes with very little haggling.

“They go on eBay, take a look at some pictures and send an e-mail to the seller saying ‘I’ll take it.’ It’s that simple,” he said. “And we’re talking all types, not just millionaires and billionaires.”

Gruettner said that in addition to the exotic and classic muscle cars, Harley-Davidson motorcycles and even boats and motor homes have also become hot ticket items for exporters and he’s more than happy to ship them wherever they need to go.

Gruettner recently shipped a white Porsche plus 16 new black Mercedes Benz ML3 SUVs to an African prime minister.

“Guess he wanted all of his entourage to have one,” he said.

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