Supercars as superannuation: race cars funding retirement

Imagine your accountant or financial advisor saying: “You know what, that race car will carry you through your later years – you should buy it.”

That may sound fickle, self-indulgent and downright crazy – but it is exactly what the Mach 1 superannuation fund has just done.

The fund’s latest acquisition isn’t just any car, but one of only five Gibson Motorsport-built ‘Godzilla’ Group A R32 Nissan Skyline GT-Rs – with only four remaining – that changed the face of touring car racing in Australia.

The striking red #4 R32 Nissan GT-R – fondly remembered as the ‘GIO’ car given its 1991 livery – finished third in that year’s Bathurst 1000 only weeks after Rohan Onslow and Mark Gibbs drove it to victory at the Sandown 500.

It was the only ‘customer’ Nissan GT-R built by Gibson Motorsport, with GIO Racing owner Bob Forbes paying a rumoured $1 million for the car at the time (today’s Chevrolet and Ford Supercars cars cost around $650,000), so it may well have been the most expensive Australian touring car racer ever built.

Lex Pedersen heads the Mach 1 self-managed super fund through Chrome Temple Investments, where the idea of buying desirable road cars as superannuation investments kicked off in May 2021.

The concept saw a collection of sought-after cars – think various Porsche 911s and exotica from Ferrari or Lamborghini – and used their combined value as an asset.

The Mach 1 fund operates effectively the same way as a typical super fund, only the investments are of the four-wheeled kind.

Three years in, the GT-R is the first one-off race car for the fund. But is a race car a bigger risk than a road car? Pedersen says no.

“In rare air the market’s far less volatile,” he told carsales. “We’re seeing things softening – it’s definitely a buyer’s market.”

Since its inception, the fund says it has produced better returns than gold with a claimed 37 per cent return – equivalent to 11 per cent CAGR (Compound Annual Growth Rate) – from a batch of around 20 vehicles worth around $12 million.

Yet Pedersen and the board now see greater opportunity in truly unique track cars like the #4 Group A GT-R.

“If you look at, say, the top 10 most valuable Ferraris, well I reckon at least seven or eight are race cars. So it’s that.”

The fund manager is correct, with Ferrari’s ‘most valuable’ list dominated by race cars, headed by several examples of the 250 GTO – natural for a brand whose genesis is racing.

In November 2023, a one-off Ferrari 250 GTO that had made its race debut at the 1962 Nurburgring 1000km endurance race sold for $US51,705,000 ($A77.6m), the highest price paid for any kind of Prancing Horse vehicle.

“In the past, race cars traded at a discount because their utility was narrow,” Pedersen said. “Given that they've transcended being an automobile into an artwork, that scarcity is actually now lifting their value as opposed to diluting their value.”

“People put money into bullion, which is a preservation; it’s a safeguard capital. I call this ‘bullion on wheels’ – it's outperforming gold, it’s a great store of value, it’s fully insured, it’s tangible.

“You don’t put your money in cryptocurrency or volatile equities when the markets are like this [unpredictable] because they can go to zero, right? They can literally overnight go to zero.

“With an asset like this, there’s always a market and it’s a great place to invest when there’s uncertainty. If the world goes to absolute custard, if nothing else, it’s a great place to preserve capital.”

Does that make any race car – of at least some interest – a smart investment?

Again, Pedersen says the answer is no, outlining why the gleaming Bathurst podium-winning GT-R racer is the start of a new phase for the fund.

“We’re not going to go out and buy 10 race cars – we’d rather just buy one of the very best. We’re doing this all day, every day – hunting out the very best purchasing opportunities.

“[The Skyline GT-R] has strong provenance and preservation – it has been preserved in its original state, and it has the paperwork – the proven history, including the podiums.

Race cars are often worth far more than the physical parts – and of course, two made up of the same components don’t hold the same value – it all comes from who drove them and what they have won (or in rare cases, lost).

“It’s a sound investment but there’s also an emotional attachment to it, and the stronger that story is – that helps make it a great investment.

“Now, if it was a less storied car that had been repaired 15 times and the paperwork was lost, there’s a few little grey areas in its history – as soon as you open up little grey areas, there’s room for pessimism over its value – and then that’s not a sound investment.”

The acquisition of race cars with global appeal like the GT-R also helps the fund attract potential overseas buyers as well as take advantage of currency opportunities.

Yet it’s not a quick flip the fund is looking for, riding the market which enabled it to land the Group A GT-R for what Pedersen says was “buying well”. It must also sell well for the fund when the market is right… down the track (pun intended).

That’s pulling the emotion from what’s usually an irrational love of a set of wheels – whether a street car or something with racing pedigree – which is what the Mach 1 Fund aims to achieve.

“Did we go looking [specifically for a race car]? No. Do we have our radar open for anything special? Yes,” Pedersen said.

The fund also recently acquired a McLaren P1 – one of only 375 produced globally – as it hasn’t narrowed its focus to simply road or race cars.

“It just needs to be very high-level criteria networking for automotive art; whether we've got a race number on it or not doesn’t really matter,” said Pederson.

“I liken it to essentially being an automotive art dealer with a global player… with our team and our investors, I keep coming back to the idea that they’re not cars – it’s not the ‘c-word’ – they’re artworks.”

“If it’s automotive art and has that provenance and scarcity, all those factors I spoke about before – there’s no real difference between the P1 or the GT-R.”

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