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Classic Car Enthusiast Wins $7.2M Fraud Case Against Restoration Shop


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Entrepreneur Bill Oesterle has won a fraud lawsuit against Healey Werks Corp. – a specialized car restoration shop in Iowa, Indiana Star reports. According to the lawsuit, the shop and its owner Craig Hillinger pocketed hundreds of thousands of dollars from Oesterle over 10 years of working together on various projects. The case was filed in Iowa in 2020 and has reached a decision recently following the investigation.

 

The relationship between Oesterle – former Angie's List CEO and current TMap, LLC CEO according to LinkedIn – and Hillinger started in 2010. Back then, Oesterle purchased a classic Maserati Ghibli for $16,000 and sent it to Hillinger for restoration work. Hillinger told Oesterle that the work would be finished in one to two years, and would cost him less than $200,000. The work wasn't completed even after four years and Oesterle was invoiced for over $1 million, the complaint stated.

 

The complaint also cited an instance when Hillinger convinced Oesterle to purchase an Austin-Healey 100M with him – a coveted factory model that needed assembly. The entrepreneur shelled out $50,000 for the unit but when he received the classic sports car, Oesterle "discovered that the 100M was not a factory 100M as Hillinger had promised," according to the lawsuit.

"I want others in the classic car community to be aware of this situation," Oesterle said in a statement.

 

Iowa District Court Judge James N. Daane has ruled that Healey Werks Corp. committed fraud against Oesterle and violated Iowa's motor vehicle services trade law. 

 

The ruling said that Oesterle suffered $2.4 million in damages. The award was tripled in line with Iowa's motor vehicle services trade law. Healey Werks also has to pay Oesterle court costs and attorneys' fees on top of the $7.2 million judgment.

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I had a relative send a car to a restoration shop.

The car is an early Chrysler.

The shop quoted $120k for a complete restoration.  Far more than the value of the car but the car had a lot of sentimental value so they wrote some big checks.

A few years in the car had not been completed, the shop wanted more money and they couldn't find some parts from the car.

Top it all off that it was discovered that the shop had not renewed its license to perform automotive work and failed to inform anyone of this fact even though their license had been expired for over a year.

 

Lawyers got involved and my relative was awarded all money he gave to the shop plus lawyer's fees and some damages.

Shop's insurance paid the claim and promptly dropped the shop's coverage.

Last I heard, the shop had closed its doors after decades in business.

Shop supposedly had done a number of cars for Pebble over the years, that is why it was chosen to restore the Chrysler.

Edited by zepher (see edit history)
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When you are spending that kind of money you need to be involved. Showing up at the shop at least once a month. Have weekly update with costs of parts, labor & pictures of work done. There is no reason you can't stay in touch with text, email & face book. After all its your car & money.

 

Jim

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If your spending that kind of money, hire someone who has a clue…….better yet, hire a expert in the field, and If your really smart…….hire the worlds expert on the marque. Long before you restore it, you need help buying it.  I have seen it 100 times. Just because your insanely wealthy, doesn’t mean you have a clue. The really intelligent ones figure it out quickly and get professional help. The other 90 percent suffer along with no clue.

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Car owners enter into agreements in good faith.   Not everyone operates on the same standards when it comes to morals and beliefs.    Accountability.....   on both sides.  But being misled into believing the car can be completed for X dollars,  a price the car owner finds acceptable and agrees to,  only to find out the estimate has been low balled just to get the car through the shop's doors.   And once the owner is into the project past the point of no return it's pretty hard to say whoa in a mud hole,  so you power through.

 

"Interview" more than one shop.   Anyone unwilling to give a solid quote probably should be avoided.   Blank checks are big checks.   I think everyone should expect some cost over run but at a reasonable level(which everyone will have their own opinion of).

 

Just because the shop perceives the customer as filthy rich doesn't give them the right to abuse them financially....   "$tay away from people who think they know what you can afford".

 

You don't want to end up hating the car by the time it's done because of some crooked or incompetent shop!

 

Does any company supply references of dissatisfied customers?    Sometimes "word on the street" can be invaluable.   There will likely be both good and bad reviews depending on customer experience,  if there's too many axes being ground....steer clear.   But BEFORE you procede "do your own due diligence".   

 

Good luck,   you'll likely need it....

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Ironic isn't it, after founding Angieslist you would think he might know how to delegate. Makes me wonder why he chose not to. I'd at least like to know why he thought he could tackle this on his own before I cast judgement. 

 

Sorry to hear he has ALS .. horrible disease I wish on no one.

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Unless you are restoring a Mustang or a Model A there is no such thing as an accurate "solid quote".     Forget about interviewing the shop,  the ones you want to bring your car to are interviewing you.

 

Fully restoring a car is a fools game with the best guys and the best intentions.  I will never fall for it again.    Mechanical work is fine,  light cosmetics are fine, full restorations are insane.

 

The plaintiff as ALS?   That is horrible.    I feel bad for everybody involved.

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When I bought my 38 I spent the $$ on redoing the engine, trans, brakes, wiring and front suspension. I did most myself but outsourced the machine work. Parts were expensive but only had to pay the supplier mark up not a second shops doubling that figure. No labor just time. The car has original paint or do I spend $8000 for a repaint? No. It needed a new interior. Do I spend $7000 on the seats and door panels? No, I bought a $25 sewing machine and $300 for materials and did the seats myself. It’s not or ever will be a conquers car it’s a driver. Shops that are good will quote hourly fees and estimates on time. If you are involved you know just like you are doing it yourself you are going to fine hidden problems. Listen to the pros on this forum, have you ever heard Ed say he didn’t discover another unforeseen problem on an even a well sorted car he was working on. The barn fines the experts locate are a mess like that. How could any shop ever quote a fixed price on unknown problems. For being such a smart business man he is a really foolish customer. He should have taken his own advice. I’m with Ed, he won’t see a dime. 
dave s 

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2 minutes ago, SC38dls said:

It needed a new interior. Do I spend $7000 on the seats and door panels? No, I bought a $25 sewing machine and $300 for materials and did the seats myself.

An advantage to the prewar cars, is the seats, door panels are fabric or leather, and are machine or hand-sewn; not heat-pressed as with postwar cars.    SMS does beautiful work for heat-pressed interior conponents, but it is costly, and due to popular demand, a LOOOONG lead time:  https://forum.studebakerdriversclub.com/forum/your-studebaker-forum/general-studebaker-specific-discussion/1963731-64-daytona-door-panels-from-sms-auto-fabrics

 

Bottom line is to definitely do the outsourcing yourself and save on a restoration's markup.

 

Craig

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From what I am experiencing with my bucket list car, I do not know how a company can give a finished price. I am enjoying what I am doing with the car. It would be depressing if I counted the hours! With the internet you can learn how to do most anything. You just have to have the right attitude when tackling a new skill---- 

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I'm always amused by the guys who bring me a car and say "their guy" is the best and he "made it right." Then I find it full of hack work and problems, just like every other old car. When I tell them about it, they're shocked because "their guy" is the finest mechanic who ever worked on a car, just amazing. They never want to hear me tell them that maybe "their guy" didn't really know what he was doing and merely took things apart and painted them rather than actually rebuilding anything and the car still drives like crap (most people don't even know the difference, but that's a discussion for another time).

 

I don't get it, but there's always a ton of loyalty to whatever hack can get his claws into an enthusiast first, regardless of the outcome of his work.

 

It's also interesting that the guys who use top shops don't speak about them in such sentimental terms. They'll say who did the work, but they aren't gushing about how that particular shop is "the best."

 

Relating to the article, if you think a restoration shop that was over-billing and not doing the work and misappropriating funds and buying projects as "investments" is going to have $7.2 million laying around, you'd better guess again. Plaintiff will be lucky to get $72.00.

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I have never had a car professionally restored, but have read many horror stories of restoration shop's taking advantage of owners. The bottom line is that you must protect yourself by having a signed contract with the shop and even have an attorney look it over. At one time there was a shady restoration shop in my area. The shop owner bragged that the first thing he did was to put a customers car in the rear of his shop, remove the wheels and get the car on jackstands. Then he bragged "now they (owners) can bitch and complain, but their car ain't going anywhere". Needless to say, that shop is now gone but a lot of people lost a lot of money. 

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My take is that it is unfair to paint all restoration shops with one brush.  Not that this is being done here but there are some very fine shops doing incredibly solid work for their customers.  These same shops have shown to be ethical as well over the years.  Asking for a time commitment and estimate is pretty futile.  Some shops are big enough to do everything in house but most rely on subs to do chroming, interior etc. so it makes it difficult to nail down a time..a guess yes but something firm not  usually a chance.  As to financial estimates you all know that until you start tearing a car down you have no idea what lies underneath the paint or the real condition of the engine.  As stated above, communication is key.  Car owner should be stay involved in the process and shop should communicate any unexpected problems.

 

I spent years having GM and my own cars restored by my best buddy from Ohlendorf's Restorations so I have seen the issues they have gotten into and we are having a car fixed by Jeff and Devon Hammer of Penn Dutch Restorations and they could not be any more fair to the club then they already have been.  Cannot wait until the damaged Studebaker is back on display.

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I straightened and polished all the aluminum trim off a 1963 Chevy Biscayne excluding the grille.  All to show quality.  The owner never complained about the work,  but in the end it was $2500 worth of labor.  It's all labor intensive,  stripping all the annodizing then straightening and polishing everything.  I charged him $30 an hour and no material cost as it was very insignificant.  He never complained about the work,  but refused to pay me the full 2500 and only gave me 1500.  I told him well you could make the difference up by sending one of your restoration guys up and work on my Plymouth convertible I took the time from to work on his trim.  This was for a Matching numbers 409 car.  He had several fully restored.  He wouldn't do that.

 

His justification was his trim shop that does his chrome could have done it cheaper if he sent it to them he said.  Though they hadn't seen any of it.  Hard to really say,  unless it was over the border.  

 

Either way I was out my time.  That was the worst part.  It became much easier to refuse work after that. Right now there is only about 2 people I will do work for.  One is a friend and it would just be work on his car,  and the other is a restoration guy I help out.  He has never questioned price and knows I only like to do a few pieces.  My regular business more than pays the bills and the trim work is really just a PIA.  Sometimes knowing how to do something is almost a curse.   Like a sandblast cabinet can be.  You tend to tackle jobs you really shouldn't waste your time on.  Did it on my 51 Dodge roadster.  I couldn't leave those dents in the fender moldings or the big ball peen hammer job on the grille panel.   Nothing bothers me more than ,  what looks like a decently restored car with dinged up stainless trim.  It's not hard to fix and not costly if you can do it yourself.  Not like plating or something.  

 

 

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I got tired of the "tech's" learning on my car & me paying the bill--My car has outlived 2 shops,both owners died--one shop still exists,but i stopped --I think part of our car hobby is the lack on new,younger techs,that only know to replace parts-no idea how to repair anything--that's why I decided to finish it myself--

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21 minutes ago, West Peterson said:

I have heard just as many stories regarding wealthy customers scr--ing shops.... FOR SPORT.

 

9 minutes ago, auburnseeker said:

It became much easier to refuse work after that.

It is not just "the wealthy", although I consider anyone who has cars for toys wealthy at some level.

 

I no longer service other people's cars. Most of my work was making "restored" cars work properly. They had already spent a lot.

 

The aging car hobbyists tend to call themselves frugal. Frugal is a word that always brings imagines of a pocket full of condiment packages to mind. You know the guy who always raids the restaurant table for sugar, jelly packs, ketchup packets. You find the stuff in their jacket or glove box, sometimes right there on the console. I watch out for them. If there aren't stealing anything that is not bolted down they are doing their civic duty to "teach" others. They have cars that need fixing too.

I remember one car that came in for a brake job. The "Oh! While you have it" jobs totaled nearly 30 individual items. "Gee, that's a lot of money for a brake job." They are a comical bunch. And you can spot them coming in the door.

 

I remember one car that required multiple repairs to make it run really nice. The owner was thrilled, until he paid. Then he broadcast to everyone he could that I charged way too much. He found a better place to get his work done. Three years later he was knocking at my front door asking how I could help him get his car back. The other person had pushed it behind the barn with the windows down and raccoons had destroyed the leather interior. I suggested he call a cop.

 

Another news story fed to a reporter who needed a bag of groceries. That's all. Read the drama and smile.

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My experience was just that a Learning Experience.

Driver restoration to be able to show at BCA the following summer. 2012. Ballpark figure $10,000 to take care of an agreed to punchlist and timeline.

Scheduled a time for pick up.

The shop delayed for over a month. Now start time is in April instead of February. If I wish to check on progress I must call first when I would drive down to make my monthly payments...... So they would look busy on my car.....

 Questioning agreed to proceedures. Now it is May....."You realy need a new wiring harness...."

It was in original punch list....."It will be months before RI Wiring can get the required harnes"..

 I called RI and they had it in stock.

 And on it went untill the end of June when they said they could not get it done on time also adding that "I would be foolish to assume that I could actually DRIVE my 1937 Buick from Central PA. to Concord NC". Well, by September the bill had climbed to over $20,000 so we had to end the relationship. Each time we spoke the owner would compliment me on"" what a great solid car it was".

 I would continue but it just gets my blood pressure up all these years later.

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There are always three sides to every story.

 

The typical problem with shops is that they need to tell 99% of the customers who walk in the door that what they want done is a stupid idea and it will cost 5 times what they think it will.  

 

I think there is a fairly even distribution of blame generally, between the customer,  the shop and just horrible luck.

Edited by alsancle (see edit history)
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20 minutes ago, alsancle said:

There is always three sides to every story.

 

The typical problem with shops is that they need to tell 99% of the customers who walk in the door that what they want done is a stupid idea and it will cost 5 times what they think it will.  

 

I think there is a fairly even distribution of blame generally, between the customer,  the shop and just horrible luck.

The truth....  and sides of the story.

 

So a guy once held a coin up to me and says,  "how many sides does this coin have"?   Well I only ever thought of a coin as having two sides.   I got a lesson that day I will never forget.   He said it has three sides.   

Let's say the head's side of the coin is my side of the story,  the tail' s side is his side of the story,  and most importantly the "THIN EDGE" of coin both dividing and connecting both sides is the TRUTH!

 

 

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41 minutes ago, 1937McBuick said:

So a guy once held a coin up to me and says,  "how many sides does this coin have"?   Well I only ever thought of a coin as having two sides.   I got a lesson that day I will never forget.   He said it has three sides.   

Let's say the head's side of the coin is my side of the story,  the tail' s side is his side of the story,  and most importantly the "THIN EDGE" of coin both dividing and connecting both sides is the TRUTH!

This should have been your comeback using this 'coin':  https://www.ebay.com/itm/253464012347?chn=ps&_trkparms=ispr%3D1&amdata=enc%3A14FAYrZ0tSZGjoadaRDe3_g64&norover=1&mkevt=1&mkrid=711-117182-37290-0&mkcid=2&mkscid=101&itemid=253464012347&targetid=1584739240934&device=c&mktype=&googleloc=1014187&poi=&campaignid=15275224983&mkgroupid=131097072938&rlsatarget=pla-1584739240934&abcId=9300697&merchantid=6296724&gclid=CjwKCAiAkrWdBhBkEiwAZ9cdcEOEhryH3n1kgaH_23o1ZqyhTQwQwYNejNq3brK264Dop-HgnOmtGRoCk0cQAvD_BwE

 

Craig

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I know it might seem harsh, but I think that it behooves every owner who is contemplating a restoration to become familiar with his car and the anticipated restoration necessary. In other words the owner needs to become an integral part of the restoration process. The owner needs to check in regularly to see how the work is progressing and ask the pertinent questions necessary to educate himself and to make it clear that he is not going away. A restoration should be an enjoyable process, not one based on an adversarial relationship between the car owner and the shop. 

 

I know that not everyone has the time or interest in doing what might seem so simple to the guys on this forum. In that case it seems to me that it would be advantageous for the owner to seek out a local club member(s) who is familiar with the car and the process, to act as an advocate to help with the communication. I find it sad when trust in the process is lost, when all that was really lacking was understanding and communication.

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First time around - we had a terrible experience on the first car submitted to a "local" restoration shop, 45 miles from home. 

Around 1985 or so, we bought a non-running  $800.00 1966 Mustang GT convertible with an unusual bench seat Pony Interior, 4-speed and "A" code engine. Turns out it had a bit of bondo, but the idea was that our 14 year old son could work on it himself, and along with my help to have it as a "Learning Experience". After attending auctions and many swap meets we were soon buying replacement parts, options, and accessories. Then several "Experts" advised that , being a rare and important model, it should be "Professionally Restored - preferably by Mr So-and-So, 45 miles away". We inquired, came to an agreement on the work to be done, the time line, the hourly rate, and maximum monthly costs. It took a while but figured out we were being gouged by the charlatan shop owner, his son, and his brother. Instead of repairing the existing metal as agreed, both complete rear quarter panels were replaced (door to bumper) with cheap and poorly fitting Chinese junk. Instead of just painting the engine as agreed, I was billed for that, PLUS a (totally unnecessary) engine, carburetor, starter, alternator, clutch, and 4-speed tranny rebuild. The wiring harness I had supplied somehow disappeared, as did the new windshield. At some point I finally got smart(er), had them stop the work, and sold the project - at a huge loss - to a talented friend who would personally complete the car for his eventual resale. Our son never got to enjoy working on, or even driving his project, but by the time he was driving, we found him a low-mileage Dodge Coronet Brougham, later replaced by a Saab 900s and then a Saab 9000S.

 

Then, having learned what NOT to do,

20 years later,

Life Got better  !!

 

Several cars were damaged by a hurricane. A club member suggested another gentleman -

far, far from home, but with exceptional capabilities, and honest as anyone I ever hope to meet.

Four of the damaged cars were shipped to his shop where two were repaired, and two others were subbed-out to other shops he trusted. Excellent results all around. I've come to respect, recommend, and implicitly trust this person, especially with regard to his advice, charges, and quality of work. This restoration specialist has since worked on or restored eleven (11) of our old cars. I don't ask him to work quickly. I do depend on his suggestions. I'm beyond doing much of the heavy work myself, and now per my wife's health issues, along with other doctor and chemo schedules, don't have the time to consider many smaller jobs I'd like to do. Thankfully we have antiques to enjoy while others are in process.

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Lots of ways to view things. I had a customer who wanted a full blown custom build. Fuel injected engine, 6 speed automatic transmission, independent front and rear suspension and all the bells and whistles. Put together a list, straight up cost of components. And running with parts equals labor. The number came to about $125,000, this was around eight years ago. Would cost more today. He blew a gasket, thought the price was crazy. Straight up parts equals labor estimate. After market engines, chassis, suspension, wheels, tires, weather stripping, glass, very easy to put a number on that. You will hit 50-60K very fast just ordering new parts. Some people, shop owners and customers. Do not understand total cost involved. Some shops rip people off, some customers actually try to drive businesses into fraud. One of my customers told me I was a target. And things got ugly. Finding a good shop might be hard, finding a quality customer base is just as hard. A lot of problems in this hobby/trade/industry. I sure am tired of trying to say something. I like watching Rodney Dangerfield, makes me laugh. I just want to weld! 

 

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The answer to all the restoration problems is simple. Does your restorer own a car similar to what your having done? In my case, I only do pre war stuff. I own and drive pre war stuff. My cars finish the tours. It’s fairly simple. Guys restoring cars for money need to be avoided. There are no rich restorers. Even the best guys doing Pebble winners. Fact is, 99 percent of the collectors have no clue you can work on an emergency brake handle for 75 hours and not get it perfect.  Ever adjust valves for 60 hours? Explain that one…….if restoration was easy, every one would win Pebble Beach. Doing your best work every day 60 hours a week is exhausting, and only one percent can achieve that level. Good work is expensive not because of the hourly rate……..it’s expensive because trying for perfection and achieving excellence is very, very, very difficult. Fact is 98 percent of car collectors have never driven a really good car. 

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Three guys sitting around . A plumber, heavy equipment operator and a car restorer. They ask the question what they do if they hit the Lottery. Plumber says I would buy an island in the Caribbean and a sailboat. Heavy operator says I go the other way and buy a lodge up north and hunt and fish. The car restorer says Ah I would just keep working till I went broke.

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34 minutes ago, George K said:

Three guys sitting around . A plumber, heavy equipment operator and a car restorer. They ask the question what they do if they hit the Lottery. Plumber says I would buy an island in the Caribbean and a sailboat. Heavy operator says I go the other way and buy a lodge up north and hunt and fish. The car restorer says Ah I would just keep working till I went broke.


 

The restorer would have ten times more fun than the other two! 
 

The pure pleasure of restoring, servicing, and driving an automotive masterpiece can’t be described. Pure joy. To become part of the machine, when the machine is a masterpiece……….there is no other sensation in the world more pleasing. Spinning a crankshaft that’s 95 years old to 4000 rpm’s. It’s a sensation that must be experienced. Slide a Model J through the corners, breaking traction with the throttle to come around a corner……….sliding a 6000 pound car………..that’s what I call living! Anyone want to let me borrow their car for the weekend? 🤔

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21 minutes ago, edinmass said:

Spinning a crankshaft that’s 95 years old to 4000 rpm’s. It’s a sensation that must be experienced. Slide a Model J through the corners, breaking traction with the throttle to come around a corner……….sliding a 6000 pound car………..that’s what I call living! Anyone want to let me borrow their car for the weekend? 🤔

______________________________________________________________________________________________________

 

I don't want you to know where I live.  And if you find out and come by, I'm not home!

 

post-34551-143141833373_thumb.jpg

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The thing I don’t understand with some of jobs is why they don’t do it similarly to how we do it in technology where you often pay to do the discovery/analysis and then doing the work seperate - surely that would give both parties an opportunity to know what they’re getting into 

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I would bet many many projects would never get started if the final price, heart-ache and grief were known before the first hour was logged.

 

I would also bet most cars aren't worth doing if you think you can recoup what it cost you.

And then comes the real reasons people choose to forge ahead,  sentimental value is priceless.

I should have known better when I decided to restore my bucket of junk.   But I liked the car, it was kind of different and not real common(one of 311 Canadian built).   I know I could have bought "something else similar".... a driver....  but it wouldn't have been this car.   I could have also picked something else that would have retained more of the sunk cost in it's value....  but it wouldn't have been this car.   I even could have bought a really nice "expensive" NEW car for what will have been sunk into this thing.....  but it wouldn't have been this car.

 

You can't expect a cheap job when barely a bolt or nut is left unturned.   There was no other way of doing this project given its condition.     No one stuffs the pillow or lining of their casket with cash,   or uses cash to fire the crematorium furnace so I'll throw some into this deep pit project.  When I look down it now,  its not near as deep as it once was.     But I wish it was done,   I had it since 1986,   I've waited long enough.

 

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Ahhhh, the problems of the rich.

This is one set of problems that I will never have to face--and I am happy for that.  Not jealous of those who can afford to have a rare car fully restored--or remanufactured if that is what it takes---I can still appreciate the art and the work it takes to create that work of art.

I think it is fantastic that the old car hobby has room for enthusiasts of every income level.

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