As tastes, habits change, demand for classic cars remains steady for Quad-Cities salesmen

Classic cars often merit a second glance when out on the road. For local dealership owners, that's good for business.

The classic car industry has remained steady over the years, despite changes in inflation, interest rates and prices. From his office in downtown Davenport, Kraig Klemme said these factors have had little impact on him helping get tires on the pavement.

The owner of Klemme Klassic Kars, he's been in the car business for about 40 years. He learned the trade from his father, Dick Klemme, who started the business as a hobby years ago.

For a time, Klemme's was on Brady Street in Davenport, until 2011 when the location was purchased by the Davenport School District and turned into a parking lot for Brady Street Stadium. That same year Klemme moved down to 301 E. Third Street where it remains today.

The new space allowed for more walk-ins, and more cars. Right now Klemme estimates he has about 40 cars on the lot, but inventory changes often. He purchases cars from all over the country and ships them out globally.

Cary Veit, owner of Veit's Vettes & Collector Cars in Bettendorf has a similar story. He too learned the trade from his father, Edgar, who opened the original shop in Davenport. Business boomed once internet marketing rolled around.

"I've been doing it so long that I have sort of developed a list of collectors. I have a small list of brokers, and many of those people are in my database," Veit said. "So when I need something, I just can send a blast to ... I've got probably going on close to 3,500 collectors, not dealers, but actual collectors. And I've developed that over all these years of being in the business."

Veit said customers typically come in looking for a specific car and through his connections, he can send a few emails and find it fairly quickly. Collectors are always wanting to increase or improve their collection, he said, and are often looking to thin out the cars they aren't using any longer.

Finding customers across the country

Klemme uses a different method, preferring to see each and every car himself, if possible. It gets tricky he said, considering he's one of just three employees in the downtown Davenport shop.

Deciding if he wants to drive to Missouri or Michigan to look at a car, for example, can be a costly trip if he comes up empty handed. Not every trip results in him purchasing a car. Each owner is looking for something specific, and that doesn't just apply to make and model.

"I try to buy them all restored, or I should say mostly restored. I try to buy them all done but then we come in and fix the mechanics of them, and just fix what is not right," Klemme said. "Make them better, try to stay away from incomplete projects. They just don't work unless you're doing the labor of love yourself and it's a car that means a lot to you. There's not money in restoring cars unless you're the owner of a body shop."

Veit agreed, saying his goal is to find clients the highest quality ride he can find. Quick flips and restorations can be a gamble, because owners are typically looking for quick cash instead of dedicating time to ensuring the car will be worry-free to the next owner.

"I'm fussy, and so the cars really need to meet a certain caliber for me to consider them," he said. "I don't do fixer-uppers. I don't do cars that need paint, that need restoration. I don't do that. All of my clients are on the higher end. And when I say higher end, I mean not necessarily outrageously expensive. I mean the best of that car."

Rise of the restomod

Both owners pointed to "restomods" or restored yet modernized cars as becoming popular in recent years. Classic car owners are looking for all the classic markings of a vintage car, with the modern upgrades that come with cars today, like automatic engine, air conditioning, disc brakes.

Veit said that in past decades, this was almost considered an insult to the car, with owners looking for cars completely vintage. Times have changed as people are looking for not only creature comforts, but a car they can trust to run smoothly.

"Today, all those same buyers realize, 'Well now I can get it with an automatic transmission. I can get it with disc brakes. I can get it with air conditioning. I need it with fuel injection,'" he said. "And so it becomes a situation where they turn the key and they don't have to think about it."

This is especially important for Veit, who doesn't typically meet 95% of his customers, he said. He fields calls from all over the country and with the internet, he can send in photos of the cars to potential buyers.

The internet has been a gamechanger for Klemme, too, with people seeking out inventory online, but he still advertises the old school way in trade magazines. Average customers in the classic car market are predominantly men, both owners said. At Klemme's, the clientele leans older and aren't always as specific as Veit's customers.

"A lot of baby boomers. Guys that either had a cool car in high school, whether it was a muscle car, '50s car. Maybe they had that 1970 Chevelle SS in high school and got married, and now they're 60, 65, 70 years old," he said. "They're wishing they had a little bit of that youth back."

Recently, Veit's customers have been getting younger, he said, pointing to the rise in restomods as a possible reason. Veit said he's recently had an influx of buyers in their 30s and 40s who are looking for the car their dad or grandfather owned, because they can have the same car with all the modern perks and no headaches.

"A lot of people don't even know how to work on those old cars. A lot of shops don't know how to work on those old cars. It's crazy how hard it is to find a guy that will turn a wrench on a classic car," Veit said. "It's crazy. You can't find people to do mechanical work. You can't find people to do electrical work. You can't find anybody to do interior or paint it. They don't exist. So you have to get these cars from areas where there is still a lot of that happening."

As the world changes, the cars have to change too, he said. People are gravitating toward the restomods because there's enough modernization that people understand how they work.

"It's an interesting time for classic cars, when you can, when you can get something that plays the part of something old, but operates like something new," Veit said.

These customers with distinct taste and looking for that proverbial needle in a haystack are Veti's specialty. Customers either haven't found the right place, or the right car, and that's an area Veit has been able to capitalize on.

While the customers have been steady, one aspect that has changed over the years has been the way they pay, he said. When interest rates were low, most car buyers paid by check instead of borrowing the money.

"Today, I would say that has completely switched. And now, as crazy as it seems, the people that are buying cars are borrowing the money, and I don't really know what to attest it to, other than the fact that perhaps they would rather pay the higher interest and keep their money in their investments rather than taking it out," he said. "But it's a significant difference, and it just keeps striking me as odd."

Veit said collector cars, or toys, are generally paid for in cash because they aren't day-drivers. They're used for special occasions, collectors items and not something people typically risk a 12% interest rate on, he said.

A few weeks ago, Veit sold a 1968 Shelby GT 500 to a man in New Mexico for a whopping $170,000. The customer had been saving up for this specific car for years, Veit said, and once he had the down payment he was ready to purchase, no matter what the interest rate was.

"It's crazy. I've never seen so many people borrowing money," he said.

While it's not unusual for classic cars to go for top-dollar, both Klemme and Veit run the gambit when it comes to price and have sold cars in more manageable price ranges, too. Each owner said they'd virtually saturated the market in the immediate Quad-Cities and do most of their sales nationally.

For Klemme, he sometimes gets a few calls from overseas, where cars from the '50s are surprisingly in high demand, he said, adding customers in France and Germany are often looking for specific makes and models.

"We might export only two or three or four a year, but they like that '50s stuff, the big chrome," he said. "Back in the '50s when you bought a car, you knew what you had. And your neighbors knew what you had."

Marketing to new generations

Exports may be slim, but nationwide shipping isn't. The demand for classic cars has remained steady over time with people all over the nation looking for the car of their dreams.

"We sell some stuff locally but a lot of its all over the country," Klemme said, listing seven Corvettes heading to Idaho, another heading to Cincinnati, a Cadillac on its way to Ontario and another heading to Germany.

Klemme said the cars are still status symbols and most people are looking for something flashy. Personally, he finds the muscle cars are best for that, but Klemme has a variety of true classics on his showroom floor as well.

In the back of his shop is a 1904 Gale Model B Runabout, a product of Gale automobiles, the cars were made by Western Tool Works of Galesburg, Illinois from 1904-1910. The ultra-rare vehicle is one of three known to be left in existence and is fully restored with the low, low mileage of one.

Cars like those, Klemme said, are typically reserved for private collections and never driven. Others are reserved for parades and special events.

Klemme estimated he sells about 100 cars a year — a pretty large amount considering he's only one member of the three-man band. With his dad still working part-time, Klemme also has a mechanic who looks over cars and ensures they're top of the line.

Veit runs a similar operation, with himself as the lead and a few part-timers checking over every vehicle to ensure its sold in the best condition it can be. About 60-70 cars are leaving his lot on a yearly basis, he said, which has remained steady through the years.

While he has no plans of slowing down, he does have a potential successor for the business waiting in the wings: his 17-year-old son, Luke. With the market looking to stay steady and younger folks looking to buy cars, Veit may just have a chance to pass down his business to his son the same way his dad passed it onto him.

"He's just recently started to kind of get excited about cars, which to me, is the greatest thing to see somebody his age (interested). And really, he's got so many friends that are car people, it gives you hope for the future," he said. "It gives you hope that there's still a good fair amount of time in the hobby."