A new set of players ran onto the Monterey Peninsula this August. They were young, cocky, and didn’t give a rip about what we baby boomers thought they should buy or what they should spend. These guys in their 30s and their 40s reminded me of confident baseball players during their first season in the majors. They were going to show their elders a thing or two about playing the game. Their bidder-paddle muscles rippled as they punched a 2005 Porsche Carrera GT out of the park at $1.1m, an Aston Martin Centennial Zagato Spyder into deep left field at $693k, […]
A new set of players ran onto the Monterey Peninsula this August. They were young, cocky, and didn’t give a rip about what we baby boomers thought they should buy or what they should spend. These guys in their 30s and their 40s reminded me of confident baseball players during their first season in the majors. They were going to show their elders a thing or two about playing the game.
Their bidder-paddle muscles rippled as they punched a 2005 Porsche Carrera GT out of the park at $1.1m, an Aston Martin Centennial Zagato Spyder into deep left field at $693k, and powered a solid double into center with a Saleen Twin Turbo at $682k. They wanted modern cars, and they paid big prices.
Like everyone else, I was prepared for a massive correction in Monterey this year. Daytonas discounted to $500,000, Dinos cheap at $250,000 and giveaway Ghibli coupes at $150,000 wouldn’t have surprised me.
After all, nothing goes up forever, and the past five years have seen an unprecedented increase in collector car prices. Every financial run comes to an end sometime. I pictured all of us stumbling home from Monterey, shell-shocked as our beloved “investment cars” had gone down in value.
But the week turned out to be completely different. From some perspectives, it was the strongest Monterey week ever, and it spoke to the underlying change in the collector car market across the board.
Simply put, we’re in a new era of collecting — one that we haven’t seen before. There are new players in town, and they’ve got their own dream cars. 275 GTBs, Duesenbergs and Packards are just old men’s cars. Bring on the Countaches and the Enzos.
It’s not just the dollars
By now the weekend numbers are well known. Overall totals of 2015 were a little below those of 2014 (currently they stand at $397m vs. $464m last year, but as we go to press, Rick Cole has yet to release results, and he was responsible for $60m in 2014. It is possible that his totals could bring this year nearly up to last).
The trendsetters of the weekend, RM Sotheby’s and Gooding & Company, were both up significantly. RM shot from $143m to $167m, a 14% increase, and Gooding from $106m to $128m, which represents 17% growth. Both companies averaged over $1m per car sold, with RM Sotheby’s at $1.3m and Gooding at $1.1m.
Bonhams’ situation is unusual, as the Maranello Collection last year bumped their 2014 totals to $108m, up 71% over the $31m of 2013. If we compare the $46m of this year to the $31m of 2013, they show a healthy increase of 48% from two years ago.
Mecum, along with Russo and Steele, continued to demonstrate that between them they own the “affordable” part of the Monterey market. Mecum rang up $44m in sales, up 23% from last year. Their average price per car sold of $116k is real money, but it only seems like a budget lot tally in the rarified atmosphere of Monterey.
In effect, regardless of whether the overall totals were up or down by a few million, the number of cars sold was up from 822 to 860, and the market-leading auction houses recorded significant revenue gains. I believe the rise of the past few years has been a gigantic and overdue market adjustment from the crash of 1989–90.
Core collectibility
The mood in Monterey was upbeat. I didn’t see anyone preparing their “Will Sell Cars for Food” signs as dealer Randy Simon only half-jokingly did after the crash of 1990. Nor did I talk to collectors, dealers or investors who were “desperate to get out” — something that tends to reflect someone who is overleveraged in their inventory and their lender is getting nervous.
My sense is that most of the cars being sold in Monterey were from wealthy collectors or dealers on solid financial footing, the cars were really nice. For instance, when I asked auction-house principals if they knew of a Ferrari 250 GTO owner who might have to sell for financial reasons, they said no. The sale price of a GTO — $40m to $50m — isn’t enough money to cause a current owner to part with a car that is the ticket to the best events in the world.
What interested me the most were the new buyers, who were responsible for the continued rise in values of collectibles from the 1980s and 1990s. I sold new 328s and Testarossas when I was working at Ron Tonkin Gran Turismo in Portland, OR. Back then, those cars were just “merch” that had to get moved.
Once they left the showroom floor, their prices predictably declined, and you could find a decent, 30,000-mile 328 for under $40,000. They were just used cars. Testarossas dropped more precipitously from their original $135,000 MSRP, as their enormous maintenance costs terrified owners. A decent driver was a $55,000 car. At the same time, late-model Countaches with their wings and spoilers were a tough sell above $40,000.
Now 308s, 328s and late-generation Countaches are climbing like skyrockets. A low-mileage 328 will cost you over $100k, a first-rate TR closer to $200k, and a 25th Anniversary Countach is a $400,000 car — or more.
The cars haven’t changed. What’s different is the new, younger group of enthusiasts who is buying them. While Lusso and Lambo 350GT owners may look down at modern-day models, most of those who grew up in the 1980s and 1990s will take a 599 or a Aventador over a 1950s Ferrari Barchetta or 1960s Lamborghini Islero any day.
You can have it all
Collectors today can choose from every era of the automobile. From a 1910 Underslung Traveler Toy Tonneau at $1.8m to a 2012 Bugatti Veyron Super Sport at $2.3m, a sophisticated and wealthy collector will find no shortage of buying opportunities. They can sample four-wheeled mobility in all its facets and glories. Never before have collectors so aggressively pursued objects that represent a span of more than a century.
Monterey 2015 was a lovefest of the collectible car, where a feisty group of new, younger bidders chasing a new group of cars joined the veteran collectors. Those younger bidders and newer cars found their places in the auction spotlight.
The more the merrier. ♦