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Why the DeTomaso name still has a value

C charliemccallMember
At the risk of beating a horse that has long since ceased to breathe, I decided to start a new topic to try to constructively explain why the DeTomaso name still has a value under the correct set of circumstances.

I think we all now accept that the DeTomaso company as we knew it is finished. No more cars will ever be manufactured by the present owners. They don't have any secret technology that they could sell to a competitor. The factory is worth whatever a similarly sized factory in Modena is worth but no more. Their staff has all pretty much left. But they do still have something of value that they could sell, and that is history.

A few months back, TVR was sold to a 24-year old Russian multi-zillionaire. There were several interested parties, but in the end he was the high bidder and is the new owner. So let's say that I am one of the other parties who was interested in purchasing TVR but was outbid. I've got some cash in my pocket and would really like to build a sports car. What to do?

I could start my own company from scratch. I'll call it "Charlie's Cars". I'll recruit some good engineers, design a great product, maybe have Tom Tjaarda design it (although I could even introduce my own design) and release it to the public. The problem is that nobody has heard of "Charlie's Cars". It has no history. No name recognition. The name will go in one ear and out the other, because it doesn't mean anything to anyone. This can be done against the odds - Lee Noble and Horacio Pagani have proved that it can be done - but it is a handicap to have to begin from scratch.

The other option is to buy yourself a history. A history that has competed in Formula 1, Formula 2, Formula 3, and Le Mans. Sure, it is cheating to "buy history", but it doesn't matter. You negotiate to use the DeTomaso name. Which sounds better on the cover of Motor Trend - "Against all odds, DeTomaso rises from the ashes thanks to new investment and launches a new Pantera" or "three dudes from south London decide to build a new car"? By buying the DeTomaso name, people have something to grasp onto. The press can publish pictures of Mangustas and Panteras, and present the new product as the successor. Of course the new company doesn't have anything whatsoever in common with the old one, but Joe Public doesn't know that and he doesn't care.

This has been done time and time again. The British motorcycle manufacturer Triumph closed its doors in the early 80s. 15 years later, a group of investors decided to resurrect the Triumph name rather than start from scratch. None of the engineers or management were the same, but it gave the new company name recognition. By using styling cues of the classic Triumphs, they tied the new company to the old very nicely. They bought themselves a history, they bought themselves name recognition.

Bugatti had been dead for decades before it was brought back. American manufacturers resurrect old products (Pontiac GTO) to give them some name recognition instead of inventing a new line.

How much is this worth in money? I have absolutely no idea. The DeTomaso commercial name isn't worth anything to the DeTomaso family if they don't plan to build anything. It would be worth something to some investors who want to build a car, but it sure wouldn't be worth millions.

If any cars are to be built in the future with the DeTomaso name, this is about the only way it can happen. Everyone wins. The Marque survives, and with proper investment and motivation could even thrive. The new company is complete unrelated to the old, we all know that, but it doesn't really matter. As long as they produce exciting products that are competitive, they should do well. Lamborghini has changed hands numerous times and that hasn't meant that new Lambos are any less "Lamborghini".

Was there really a British group looking to buy the DeTomaso name? It is at least feasible, and it would be a reasonable thing to do if they are considering entering the market. In the meantime, the DeTomaso name will remain dormant, waiting to be rescued by some knight in shining armor, riding in on their 351... Any volunteers?
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S smmartin7Member
Charlie

You bring up some interesting points, but as a counter-point I would look at some recent automotive history.


Ford spent billions buying Jaguar and Aston Martin to get names with a "history". Then spent billions more upgrading facilities and designs. Now all they have to show for it is a large tax right-off every year from their losses. At about the same time Infinity and Lexus were started from scratch, slowly creating their own history, and making money to ensure their survival. Ten years from now which of these brands will still be around?

Qvale bought into the DeTomaso name to get some history. We all know how that turned out. It is very similar to what happened about 3 decades earlier when Ford originally bought DeTomaso, to get some history and an Italian name. We can only speculate how things would have turned out if Ford had created their own Italian brand in 1971.


Don't get me wrong, I am not against DeTomaso (just of the opposite). I enjoy my Pantera and Longchamp, and plan on driving them for decades to come. There were many small car companies started about the same time as DeTomaso, none of them are still around. They are either in the history books or swallowed up by a large company only to lose their character. DeTomaso survived longer then the rest for a variety of reasons, I think the largest reason was him. As far as I know he ran his own company longer then any other auto founder, including Henry Ford and Enzo Ferarri, so in a way he won the most important race.

I think the hard part about putting a price on the DeTomaso name, is that it means different things, depending to who you ask. To the current owners (mostly Panteras) it means a great car at a reasonable cost. To most non-owners it means cars that were poorly engineered, that rusted and haven't been produced since 1974. To make the name survive you would cater to the first group, who want a good looking, mid-engine exotic with a mass produced engine. To do this and have it legal in the US and Europe you either mass produce it, which takes away the aura or you have a high price tag like a Ferarri. If you sell 20,000 a year it is too common to be considered a true exotic and no one would pay significantly over $100,000 for a DeTomaso, which is why the Pantera200 and Guara didn't sell.

We have been hoping someone would make a "new" Pantera for the last 20 years, but our expectations are too high for what we are willing to pay for it. I say lets enjoy the cars we have. We have a great group of vendors that keep our cars running, a great group of clubs providing opportunities to use our cars and a great group of owners that enjoy using the cars. What more can you ask for?

Ciao
Scott
C charliemccallMember
Hi Scott,

Some good points. If the launching of a new automotive adventure is poorly done then it is doomed to fail, regardless of if they have purchased a history or not.

Infinity and Lexus produced a very high quality, world-class product that allowed them to overcome their lack of history. The Paganis and Nobles and Infinities and Lexii show that it can be done, it is just a little harder to do it. I'll take your word for it that Aston loses money - I honestly don't know - but they've had great reviews for the DB9. They have a good product, the question is if they can make money with it.

You are correct in that we have high (impossible?) expectations for any new Pantera. And it would be a difficult task to achieve - but it would be great to be able to cheer for the "home team"... I guess that's why I'd like to see it continue.
markcharltonmarkcharltonOld enough to know better and still young enough not to care. My '71 Pantera
Charlie, I'm with you. A crappy product with a sexy name will flop. Period. The DeTomaso name will enhance an excellent product AND could easily make the difference between success and failure. The new Mustang will undoubtedly enhance the fortunes at Ford in a way the Mustang II of the mid 70's did not. The name didn't make the difference, the product did. How much success would the new (2005) Mustang enjoy if it was called the Probe II? Some, but undoubtedly less!
G GhostRidr (Guest)
quote:
Originally posted by smmartin7:
If you sell 20,000 a year it is too common to be considered a true exotic and no one would pay significantly over $100,000 for a DeTomaso, which is why the Pantera200 and Guara didn't sell.


I think one of the biggest problems of the Pantera Si, was not making it sellable in the American market--where the Pantera is the most prevalent.
detroitmasodetroitmasoMember
Charlie,

I sure would love to see that happen, and what you are saying does make a lot of sense, but is there really enough interest in the Detomaso name for someone to buy it? The race history just isn't there. I mean Detomaso built and raced a few cars but never made a huge impact or name for himself in the racing world. He never had any history changing technology that he would be remembered for. I think others, like Aston Martin for example have the history and name recognition to help sales, but most people have never heard of Detomaso, besides a small, albeit very loyal following.


I hate to be so pessimistic about it because, like anyone else, I think it would be great for Detomaso to continue on and become a truly world class automotive name. However, you can be pretty sure that no large automotive company will never absorb Detomaso, especially Ford (too much bad blood). The only way it could happen is as you descibed. Someone with a ton of money, and the desire to make a sports car buys the rights to the name.

Lets hope it all works out this way.

Ian
G GhostRidr (Guest)
quote:
Originally posted by pantera874:
Bratt, i don't wanna pester you, but keep in mind, the price for the Pantera SI was 175.000 german marks (120.000 Dollar) in the ninetees. The Targa was 210.000 (140.000 Dollar). Do you know someone, who pays that price for just a good loking sportscar without any technical highlight?


Hello Shadow,

If it was sold in the US, that would give it much more volume. More volume=cheaper cars. As long as it looks good, goes fast, and handles well, that's all thats needed to sell. People with large pocket books don't care.

quote:
The most breaker for The SI was the engine. If you have a fast looking car, it has to be fast.


Look back in your vast magazine archives, I'm sure you'll find one detailing a prototype Si that was twin-turbo charged, and it was incredibly fast.
C charliemccallMember
quote:
Originally posted by detroitmaso:
Charlie,

I sure would love to see that happen, and what you are saying does make a lot of sense, but is there really enough interest in the Detomaso name for someone to buy it? The race history just isn't there. I mean Detomaso built and raced a few cars but never made a huge impact or name for himself in the racing world. -snip-

I hate to be so pessimistic about it because, like anyone else, I think it would be great for Detomaso to continue on and become a truly world class automotive name. However, you can be pretty sure that no large automotive company will never absorb Detomaso, especially Ford (too much bad blood). The only way it could happen is as you descibed. Someone with a ton of money, and the desire to make a sports car buys the rights to the name.

Lets hope it all works out this way.

Ian


Hi Ian
DeTomaso doesn't have an outstanding racing history, but at least it does have one. Any racing history would be more than the none that a brand new company would have. A talented PR or marketing guy wouldn't let the truth get in the way of a good story ;-) He could show photos of old racers from the 60's... He could show Panteras at Le Mans... He wouldn't have to say that only one finished... He could show that photo of Alejandro and Enzo Ferrari looking at DeTomaso's F2 car... It would give the company some kind of tie-in to a company that built race cars.

I was going to agree with you and say that DeTomaso would never be absorbed by a large, established corporation and our only chance was for an entrepreneur to buy the name to buy instant history, as mentioned yesterday. But now that I think about it, for the sake of argument, suppose that someone that has no history of building sports cars wants to enter the market. Just for the sake of argument, let me present another possibility.

Toyota established a brand new marque to enter the luxury market - Lexus. Lexus didn't have a history of building cars, they didn't have a reputation for outstanding quality... they didn't have ANY reputation! But because the Lexus really is a high quality product, it caught on and established itself as a leader in the market. Let's say that Toyota decide that they want to enter the Sports Car market to compete with the elite. They can either do the same as they did with Lexus - invent a brand, or they can purchase a name.

Anyone who follows cars knows that Lexus is Toyota, but if you don't really know much about cars you don't know or don't care. Perhaps you don't know that DeTomaso is really Toyota. It isn't really important. The brand is resurrected and built by new owners, Toyota. It isn't a Toyota, it is a DeTomaso. If you look under the skin, of course, it is exactly the opposite.

A criticism sometimes heard in the early days of the Dodge Viper is that it had no history, and no racing heritage. That changed, of course, but if they had bought a name that did have racing heritage, however successful or unsuccessful, that's one more feather in their cap.

I'm just sitting here on a Saturday night with a cold beer and thinking out loud. These scenarios are long shots, sure. I'm just trying to think of how it could happen... happy to hear your thoughts
C comp2Member
If some one would buy the DeTomaso Name and build a Pantera, it would have a lot of respect if it continued down the same lines of the original car. Some times it's not just the who is in the name but the deffinition in the name. If the car is a purpose built performance car, exotic and unique, similar to the original Pantera it will carry a lot of respect for whomever picks it up if it was a coninuation of the name/car for the purpose and pedigry it was developed. If some one makes a DeTomaso Pantera with a 4-door and room for all the soccer kids or lugage, the name, it's deffinition and value will be lost.
C charliemccallMember
quote:
Originally posted by deeb:
Does anyone have an idea of exactly what is for sale, by whom and for how much?


I don't think that there is a formal "for sale" package available. At least I haven't heard of one. I was merely speculating what a potential buyer could gain by reaching some kind of agreement with DeTomaso to use their name.

The ball would be in your court - you'd need to contact them with a proposal - "we want to use the DeTomaso name to build cars, and we'll offer you X". Or whatever. As far as I know, they are not actively promoting anything...
VI veryfast italain (Guest)
Does anyone have an idea of exactly what is for sale, by whom and for how much?

I know how to get that information, beyond the rumor mill, and the real info, if a person ahd a serious interest.

Since it is known that the company was seeking liquidation, creditor protection, or any other nice way of saying that, the fact it implies is that pleadings were filed in a court of law in the country and county, probably Modena, Italy, the city, which usually houses the county courthouse. I quick review of those pleading would reveal the trustee for the liquidation or reorganization of the bankruptcy estate, that's language we use here in the USA, of course. Anyway, that's the contact person who an interested party would contact, if say they wanted make an offer on some particular assett or attend the auction, which I'm not sure the status of. And since I can't do anything about it, I haven't been following it. But name recognition is considered an intagible asset, sometimes called 'good will' which can have value. For example, the trademark name 'Coca-Cola' has a value in the billions if not trillions of dollars. If there were a group of investors, say promoting a new exotic sports car, built from scratch and wanted to market it, thenpurchase of the name, this specific intangible asset with value, would create genuine interest in the vehicle being marketed, simply by carrying the name brand. That would be us. Like "What is the new DeTomaso car like, have you seen it?" And thus creates intangible value for the purchaser, i.e., marketing clout. So, yes, the name still carries value, and to some extent, to the extent it creates 'name recognition', the name DeTomaso will always have value. Still and into the foreseeable future.
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