Investing

The Return of the Gas-Guzzling, Huge-Engine Supercar

Garrett Nelson, vice president and senior equity analyst at CFRA Research, joins BNN Bloomberg to share his top picks in the auto sector.

(Bloomberg) -- Aston Martin just unveiled its latest flagship model, the Vanquish. A muscular, carbon-fiber-bodied $429,000 coupe, it’s more luxurious and sporting than the DBS it replaces, featuring a coddling leather-and-cashmere interior and reaching a top speed of 214 miles per hour, the highest ever of any Aston series production vehicle. Motivating it is a new twin-turbocharged 5.2-liter V-12 engine that produces 824 horsepower, a significant increase from the 759 hp of its predecessor’s V-12.

Aston’s beast joins a host of all-new six- and seven-figure supercars—including the $423,000 819 hp Ferrari 12Cilindri, the hybrid $604,000 1000 hp Lamborghini Revuelto and the $4 million 1800 hp Bugatti Tourbillon—that feature 12- or 16-cylinder gas-powered motors, generally in larger and more potent forms than their progenitors.

This runs counter to prevailing trends. After decades of using 12-cylinder engines in their flagship models, Audi, Bentley, BMW and Mercedes-Benz recently eliminated them from their lineups. For its new Temerario, Lamborghini ditched the V-10 that’s powered its entry-level sports cars for two decades. These manufacturers have moved instead to smaller turbocharged and/or electrified 6- or 8-cylinder motors that are nonetheless extremely vigorous. Stricter standards for fuel economy and tailpipe emissions are the key cause, as is optics, with the automakers trying to follow through on capricious promises to transition to electrification.

The upsized and up-powered engines seem to signify a reactionary impulse at the pinnacle of the car market. “The top customers want the cylinder count,” says Alex Long, Aston Martin’s director of product and strategy. “Even though we could achieve, through different methodologies, similar attributes in terms of power output, there’s a uniqueness of V-12 that is synonymous with our brand. They want that heart and soul of an engine.”

These engines provide unique, direct mechanical attributes, hallmarks of what industry analyst Sam Abuelsamid calls “authenticity.” Long likens them to a fine Swiss watch. “Is it the most accurate time piece? It may not be. But what people love is their methodology, movement and mechanism,” he says. He calls out the motors’ minimal vibration, ready delivery of physical thrust and the “emotional baritone” of their exhaust notes.

Moreover, at a time when ultra-luxury cars such as the Rolls-Royce Spectre and hypercars like the Rimac Nivera are shifting to the insulated hush of battery power, these large gasoline-burning engines hark back to classic supercars of the 1960s, ’70s, and ’80s, both in terms of design and, particularly, driver engagement.

Collectors in this echelon are seeking this visceral, heady experience. “You have this sense of almost being like a caveman. You’re in charge of the fire as these little explosions go off inside the engine,” says Jeffrey Einhorn, a Manhattan attorney and car collector who co-founded the Bridge, an exclusive car show held in the Hamptons each September. “And with a V-12, you have 12 of them, so you are like the absolute king of kings.”

Einhorn recently replaced his 12-cylinder Aston Martin with a 12-cylinder Ferrari and drives it regularly, preferring its smooth tractability and “operatic” exhaust to the brutal potency of his 6-cylinder Porsche 911 GT3RS and the peaky hot-rod nature of his 3-cylinder Toyota GR Corolla Circuit.

Considering ever-increasing efficiency standards, there are significant engineering and fiscal challenges in creating such big motors. These include designing them to be implemented in an automaker’s cars long enough to amortize the development expense. “V-12s are enormously difficult to create for this modern era of combustion,” Long says, noting that the engines are “future-proofed” for forthcoming legal regulations through to the 2030s. “We’re investing a lot of money and time in compliance.”

Its placement in a vehicle thus denotes it as a top-tier offering. “It’s a very special engine, and therefore you attach it to a very special product,” Long says. He adds that Aston’s V-12 will appear only in products priced at “Vanquish and above,” generally meaning there will be limited editions of coach-built one-off or few-off vehicles. Such rarity and desirability help manufacturers justify a significant “price premium” for such models, says Matteo Ortenzi, product line director at Lamborghini. This yields long wait lists and enhanced profit. Ortenzi says the Revuelto has sold out for the next two and a half years.

According to Abuelsamid, low-volume automakers such as Bugatti and Lamborghini, which are affiliated with the VW Group, and boutique independent automakers like Aston Martin and Ferrari receive special dispensation or offsets from some federal efficiency regulations. These cars are subject, however, to a (comparatively negligible) four-figure gas guzzler tax in some jurisdictions.

Few clients drive these cars on a daily basis. “In such use cases as urban commuting,” Long says, “our clients are already using EVs.” Einhorn has broad experience with EVs but doesn’t currently own one, for personal reasons. “I miss the noise, vibration and harshness—the smell, and being the conqueror of those 12 little combustions going off constantly,” he says. “If there’s no shifting, no sound and no smell, you lose more than half the experience.” (He jokes: “I have an electric car for commuting. It’s the subway.”)

Produced in tiny three- or four-figure runs, globally, these supercars are “drops in the ocean in terms of emissions volume,” according to Mate Rimac, CEO of Bugatti. “They are barely being driven—less than 1,000 miles per year on average. So they could be coal-powered; it wouldn’t make a difference.” The automakers’ stubborn veneration of internal combustion is based in part on their abiding to a creed and clientele that reject norms. “It’s a little bit of rebellion,” Rimac admits.

Lamborghini’s Ortenzi puts it a bit more bluntly: “We don’t have any rush to stop this V-12 production or switch to a different kind of engine until we are forced to do so.”

Moreover, Rimac says, extreme supercars are “technology demonstrators,” transcending automotive possibilities. He believes this makes them worthy of intrinsic exultation. “These kind of cars demonstrate human achievements and human ingenuity and craftsmanship in all the disciplines—dynamics, design, material sciences,” he says. “It’s art. Why would you forbid it? Would you forbid paintings?”

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