That more than $200 million worth of cars changed hands during Arizona Auction Week in January was no real surprise, given the buoyant atmosphere found everywhere I went. We’ll hit on a couple major trends and a few personal highlights before delving into what is behind it all.
Personally, the first and most obvious trend (and one that is not on everyone’s radar) is the continual price divergence between original cars and their restored counterparts: witness the 1965 289 Shelby Cobra that brought $1.32 million “all in” (hammer price plus buyer’s premium) at Gooding’s. This was a stud car, in very nice untouched condition with a bulletproof provenance, and the same Cobra totally restored probably would have brought $500,000-600,000 less. As the old saying goes, “it’s only original once,” and more and more money is comprehending that and how such cars are truly archeological treasures. Prices for such machinery are thus escalating at a rapid pace.
Which isn’t always healthy or rational. Gooding also had a 1956 Lancia B24 Spider America that can be best described as tatty, like a dusty old couch with worn and torn upholstery, sagging seat cushions and some springs sticking out. Yet someone paid more than $800,000 all in, most interesting when I saw a very knowledgeable dealer friend enter the bidding around $500,000 on behalf of a client, and quickly drop out around $50,000 later. “I thought we were going to scoop it, coming in then,” he said. “But I was quickly proven wrong. That was just too insane.”
This made Gooding’s 1965 Buick Riviera Gran Sport an absolute bargain. This design icon was completely untouched, in showroom new condition, had three documented owners and around 15,000 miles on the odometer. For automotive historians a century from now, this car is a gold mine in a way the Lancia and almost every major concours-winning car is not, for it clearly shows how the finishes were when the car was originally built.
Another trend the Buick also highlights is American cars remain the bargain of the collector car market (a trend covered in detail here). Gooding’s ’68 Shelby GT500KR was a lot of car for the money at a shade over $100,000, but the American muscle that really bit me was their Plymouth Superbird at $165,000. This car is so whacked, so far out there and such a performance icon that for the “10 Word Review” I did for the AUTO100, I dubbed it “America’s Countach.” (You can find the video here.)
Prices were equally strong over at RM Auctions. I didn’t see that much of the sale, but spent a fair amount of time wandering the lots with Shelby Myers several days before the auction. RM revamped their formula, cutting the sale back to one day, going a bit more upmarket and, most importantly, holding the auction in a much larger room that made for a most appealing atmosphere. We also spoke about how inexpensive money (low borrowing costs and non-existent rate of returns for funds sitting in a bank or money market fund, a sentiment echoed by David Gooding) is influencing the car market.
The RM lot that really bit me was a one-off 1933 Auburn B-105 Retractable Hard Top Cabriolet with superb colors, ultra clean lines and stunning proportions. This is an A-list showcar if there ever was one, and will get you into any concours venue in the world. Not bad for $440,000…
If you were looking to buy a 1969-70 Mustang Boss 302 or a 1970 AAR Cuda, Barrett-Jackson was the place for you. I saw at least a half dozen of each that would have tempted my bidder’s paddle had I been registered at the sale. A couple of the Bosses went for very reasonable money, affirming that you can get a lot of car for $60,000 or less.
The day I was there (Wednesday) was nothing compared to Saturday’s madhouse. Several days after the auction Craig Jackson and I got caught up in a phone call, and he said, “I’ve never seen anything like what happened when the Batmobile went up for sale. All the people that were out there looking at the car in the staging area simply followed it in when it drove into the tent. It was so crazy we didn’t even know that the two guys bidding on it were flipping a coin to see who would get it.” (It sold, all in, for $4.6 million.)
Craig also confirmed the week’s wildest statistic, one that I had heard through two different sources: That there was $1 billion worth of money in the tent that week, bidding on cars.
So what’s (excuse the pun) driving all this? Earlier this month, McKeel Hagerty, a gonzo auto aficionado and president of the collector car insurance company that bears his name, told me “Boomers are back to spending money on things that matter to them, but there is much more going on than that.
“The high end comprises a global market now. It is no longer ‘Car Hobby 2.0’; it is ‘3.0.’ One-point-oh was the ‘do-it-yourselfers,’ 2.0 was the modern world, where somewhere the economy is up, and somewhere else it is down. Now, there are a lot of strong economics with bright spots in those economies, and the newly wealthy in places like China and elsewhere like ‘rich guy stuff.’ So they are buying it.”
No question that’s correct (two weeks ago I had a conversation with a friend about a very wealthy Russian who is expanding the horizons of his collection), but I think an even bigger theme is underlying the surge in prices, one that goes a long way in explaining why $500,000 “chairs and flares” Dinos and $700,000 330 GTCs make complete sense.
Which is what we’ll delve into in next month’s entry. See you then!