Classic carmaker builds on reputation
BY STEVEN MIHAILOVICH, BUSINESS PRESS
America is all about rock-n-roll, fast food and fast cars. So Shelby Automobiles assembly plant in Las Vegas is a genuine piece of Americana that has been cranking out some of the best known cars in the history of U.S. auto production and making money at it.
Shelby Automotive Public Relations Director Gary Patterson sits in a Shelby Cobra built in 1962. It was Shelby’s first car.
Located in the shadow of the Las Vegas Motor Speedway where the Shelby cars are often test run, the facility is part auto dealership, part museum and part overblown garage.
Auto enthusiasts gawk during the daily tour of some of the most famous racing cars ever built. In the back, body men and mechanics with long hair and tattoos are listening to classic 1970s rock tunes while machining parts, painting the chassis and supercharging the engines.
It doesn’t take a gear head to recognize legendary racer, entrepreneur, philanthropist and founder Carroll Shelby, but if he isn’t familiar, his products probably are. They are classic muscle cars — Shelby Mustangs, Vipers and the Cobra, acclaimed by Motor Trend magazine as the most significant American-made car of the last 50 years. The look, the lines, the performance; it doesn’t require a passion for cars to love these.
“These are big-boy toys,” says Gary Patterson, Shelby Automobiles public relations director and a test driver. “This is fastball, hamburger, American V-8 ‘get-go’ power. It’s like our warranty: 100,000 miles or six seconds, whichever comes first.”
When Shelby’s first automobile, the Cobra CSX 2000, was introduced in 1962, it went from zero to 60 miles per hour in 3.9 seconds at a time when cars were averaging nine to 10 seconds for the same acceleration.
The speed still thrills. One customer picked up his custom-built Shelby from the Las Vegas facility only to return it for repairs after wrecking it. The odometer showed 19 total miles.
Shelby cars made their name in the 1960s, just as Shelby himself made his name in auto racing in the previous decade, finishing first in 50, and placing in the top four in 81 of the 111 races in which he competed between 1952 and 1960.
Forced out of racing with a heart ailment, Shelby capitalized on his experience and started developing racing cars. Using a brand new engine developed by Ford and the body parts produced by AC Cars in the U.K., Shelby produced the Cobra, a name inspired by a dream.
Since then, Shelby’s company has worked with all three major automakers to create models that have become collectors’ items, which have in turn spurred scores, if not hundreds, of imitators.
“Carroll understood things in the 1960s that are now taken for granted. For example, he knew the importance of taking weight off the car. He knew a car needs to turn and stop repeatedly on a racetrack,” explains Patterson.
Founded in California, Shelby moved the company to Las Vegas in 1995 and then opened manufacturing facilities on Valley View Boulevard the following year. In July 1998, Shelby Automobiles moved to its present 150,000-square-foot facility in three buildings to become the first and anchor tenant of the Industrial Park of the Las Vegas Speedway.
The facility assembles and customizes its cars out of lightweight hand-rolled aluminum as well as carbon fiber and less expensive fiberglass shipped in from around the country and the world. Because of tougher emission standards, the company no longer produces engines and transmissions; however, it does custom-fit those selected by customers.
The facility churns out 50 to 60 cars a year, but sells slightly more than 100 annually through the 20 authorized dealerships in the United States and one in Norway. The production-to-sale gap explains why it took two years to complete the 1999 Series One, Shelby’s first car totally designed in-house for General Motors
“We don’t build cars and have them milling around, waiting for customers,” Patterson says. “We’re backlogged for several months, up to a year on some models. We lose some customers that way, but we don’t stamp out cars like cookies. Our customer knows and is used to waiting because he understands the product.”
The production facility is car-guy heaven, with the emphasis on the word “guy.” Women are rarely seen working or visiting or purchasing at Shelby Automobiles. It’s about the image and the passion, and employees and customers know it.
Patterson is typical. An operations manager at TJ Maxx Distribution Center here since 1990, he was also president of the local Mustang Club and vice president and event producer of the Silver State Classic Challenge Race. He moved to Shelby when then-president Don Reigner offered Patterson a job after a presentation before the Mustang Club.
Since joining, Patterson turned down a “six-figure” job with bonuses and stock options for a distribution outfit in Pittsburgh. He is relaying the story while pushing a Series One more than 140 miles per hour.
“Pittsburgh? Can you imagine?” Patterson says, barely audible above the roars of the wind and motor. “I said, ‘You’re going to give me … a job and give me three weeks vacation to spend what I do 52 weeks doing now?’ This isn’t a money thing for me.”
He hits the brakes and the car decelerates to zero in a couple of hundred feet without screeching, shaking or spinning out of control. Patterson turns to reiterate the image.
“Besides, after my divorce, this was a great job to have, if you know what I mean,” the 46-year-old test driver says.
If a car like the GT500 Mustang is the fantasy of just about every red-blooded, blue-collar American male, fulfilling the dream is definitely beyond the reach of most. Shelby cars range from $46,995 to $135,000. Even the detailed model car on Patterson’s desk costs about $1,000. Don’t forget, both the model and actual car come without engine and transmission.
The price and the wait, however, is worth the fantasy for Shelby customers, who usually are affluent males between 45 and 65 years old, 25 percent of whom already own one. In fact, the wait extends much further than the production time.
“[Our customers] remember these cars clearly. In their youth, they may have owned one or it may have been just out of reach. They remember these things. They worked hard, raised a family, were a success in business and now the kids are gone. Now they want to play and the car they want is what they always wanted. We’re in the business of fulfilling dreams,” Patterson says. “People who buy our cars aren’t sweating payments.”
He likens payments on a Shelby to house payments, meaning the cars sell in part because they resell. The collector’s market has gone through the roof and to protect both the brand and customers, Shelby maintains a World Registry of every car it has produced, which includes the owner history and any modifications where possible.
“We are seeing values triple in the last two to three years,” Patterson says. “That’s better than the stock market and that means your old Shelby original is worth more than the new $70,000 Mercedes in your garage. Is there a guarantee the price will go up? No. Is there a guarantee IBM shares will go up? No. Stocks are sheets of paper. What can I do with it? Nothing. I just hope I can make money. If I own a 427, I can drive it, race it and have a lot of fun and by the way, it will probably go up in value.”
Although dependent on older customers who remember the cars for the business, Shelby is not worried about gaining new fans. The reputation of the car has a life of its own and the company does little marketing, consisting of taking a car to shows every other weekend on average and continuous articles by trade publications, history magazines, documentaries and so on. In fact, Shelby makes a tidy licensing the various brands to video games for youngsters.
Patterson argues, though, that the best advertisement is product itself. “When a Cobra pulls up to a traffic light, it makes a statement,” he says. “There’s nothing sissy about it. It’s a man’s muscle car. The look, the sound, the smell. A 10-year-old boy or girl, who has no idea of the history of cars, will see that and say ‘That is something’ and want one.”
stevenm@lvpress.com | 702-871-6780 x340
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