Classic Car Fraud - Part 3 - Copies & Kits


1988 Bernardi Kit - photo provided by Blakely Auto Works
COPIES, REPLICAS & KITS - SOME GOOD NEWS...
copy - noun \ˈkä-pē\: something that is or looks exactly or almost  exactly like something else: a version of something that is identical or almost identical to the original

Source:  Merriam-Webster Dictionary

A frequent argument supporting "legitimate" copies is so few original collectible cars exist or are affordable to own, classic enthusiasts turn to modifying one edition of a collectible model to appear as a more premium and desirable edition. While some have criticized such motives as an opportunity for fraud. Others believe that so long as future buyers are informed of the modifications made; no harm, no foul. Yet the possibility remains that somewhere in the future, an owner may "forget" about the vehicle being a "legitimate" copy of what is appears to be.  At that time, the future buyer could claim fraud and consider the vehicle a counterfeit.


rep·li·ca

noun \'re-pi-kə\:  an exact or close copy of something
Source:  Merriam-Webster Dictionary

Simple stated, replicas are copies of the 'real mccoy'. Replica kit cars allow classic car enthusiasts the opportunity to experience what it was like to own/drive such a vehicle. 


Kit cars have been around since the earliest days of automobiles, but it was not until the 1950's that replica kits really took off. During the '70's many of us can recall kit cars featuring bodies styled as sports cars that were designed to bolt directly to the chassis of a VW Beetle.


Many consider replicas not "real" cars. They cite the lack of warranties, little or no dealer or manufacturer network for service and the lack of a "lemon law" protection as why buying replicas should be approached with caution. Buying a replica may save money, but acknowledge there are other issues to consider. Regardless of the make, model or year of a replica kit being considered, understand it is still a "project car" and needs to be viewed as such and will demand time, money and determination to complete.


Current kits are frequently replicas of well-known and often expensive vehicles - new & old and is a practice that has been going on for nearly forever. Turning a Pontiac Fiero into a "Ferrari" is a very common example. The AC Cobra and Lotus 7 are also particularly popular models. Ironically, Lotus actually started as a kit car manufacturer.


NOW THE BAD NEWS...
A "Mercy 4" built by CARKITINC utilizes a Pontiac Firebird chassis.
For $3,995 and approximately 4-6 built time, a buyer pulls away in a faux "Lamborghini".
This CARKITINC faux "Lamborghini" is really a 4-cylinder Dodge Neon
TOO GOOD TO BE TRUE -
Lamborghini Automobili has filed suit in US District Court against CARKITINC of Albertville, AL demanding they cease production of the kit and destroy all molds and forms used to produce the body parts. After all, if you don't protect your patents and legal trademark, you can lose them based on the legal concept of "abandonment".  For patents and trademarks representing companies worth hundreds of millions of dollars, protection is critical.
Read more of the NY Daily News June 2013 story

In another case, a US District Court judge in Florida ruled that two St. Petersburg firms that re-bodied vehicles to make them look like expensive makes or models were illegal and infringed on patents and trademarks.


British car maker Bentley Motors Ltd, a subsidiary of Volkswagen Group of America, also sued Fugazzi Cars and Keeping It Real Auto Customizing for damages and filed a preliminary injunction against both firms to block them from making, advertising or selling their kits.  If buyers couldn't afford a $200,000 Bentley, this might not have been smart way to offer them a look-alike option.

Read More of this ABC News story
Fugazzi Cars re-bodied a Chrysler Sebring to appear as a Bentley Continental GTC
REPLICA VALUE
Obviously a genuine Cobra, Porsche Spyder or Gullwing Mercedes-Benz is worth far more than any replica. As Garagistry’s Blog has cited, consider genuine classic vehicles with well-established provenance the automotive equivalent of a blue chip investment.  As such their values tend to trend generally upward based n the laws of supply and demand.

But there have been dips in the market. Before their recent climb to record price levels, genuine Cobras have withstood swings of $100,000 in their market value.  Quality replicas, while certainly not investment cars, often don’t depreciate as quickly or significantly as a genuine classic might. Hayes Harris, owner of Wire Wheel Classic Sports Cars, and deals in used replicas, says "while such cars still depreciate, there is a strong market for good, used replicas".

REPLICA KIT DOCUMENTATION

Despite state-to-state variances several basis requirements are consistent.  But given the “replica” status of each vehicle, we can see how otherwise legal documentation could be misunderstood by a novice buyer.  


Basic documentation - replica kits should come with a Manufacturer’s Certificate/ Statement of Origin. The MSO is tied to a vehicle identification number mounted to the frame. If built entirely car from scratch, the car should be referred to as “home-built” instead of having been assembled by a commercial source.

SPECIAL FACTORS

Emissions documentation is an area that can be very confusing. In some states, owners are allowed to register a replica as the original model that it depicts. This means the replica only has to meet the standards of the original. If it’s a replica of a 1965 Cobra, for example, then the replica vehicle would be titled as a 1965 Cobra and only have to meet the emissions specs for a 1965 Cobra.

California is, as usual, a special case. Senate Bill 100 (SB100) allows owners of kit cars, replicas and street rod reproductions to register kit cars as Brand New cars (referred to as "SPCN") with a 1965 smog exemption. In other words, a Cobra replica has only to meet 1965 standards, even if it’s fitted with a 2007 engine. If the car looks like nothing else, then it’s given a 1960 date.

Finally, don't try to register a kit car in California using a counterfeit title from another State or try and sneak past the CA DMV.  The DMV will find you and impound your car.  And if you signed any documents with any kind of fraudulent claims, remember those documents were signed "under penalty of perjury" - and that could really ruin your day/week/month or years ahead...

To read Part 1 of this series, click here
To read Part 2 of this series, click here
To read Part 4 of this series. click here

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