Market Insight — Making Sense of Monterey
Last weekend's bonanza in Monterey was awaited by many insiders with almost religious anticipation. Never in recent memory had so much been at stake as an unparalleled spread of 'big ticket' cars was offered for sale in the middle of a worldwide economic storm. The auction houses pulled out all the stops to put on a show of confidence and get a buzz going. The car collecting community watched anxiously to see the outcome.
If you don't think the results affect you, think again. What happens in a very public sales arena flashes around the world in hours: meltdown in Monterey would have spelt an instant loss in confidence and buyers reassessing values of everything from Ferraris to Austin-Healeys. As it turns out, you can sleep peacefully; you might even want to crack open a bottle of bubbly. For now at least, the market shows little sign of letting up as buyers are piling in to anything they perceive as being a potential showstopper, 'the best' of its kind, of 'time warp' quality and much less besides.
You can read expert reporter Rick Carey's analysis in this newsletter and the numbers speak for themselves. The 2011 Monterey auctions set more records than most insiders can remember falling in a single weekend, including the highest grossing car auction totals in history, the highest price ever paid for a motor car at auction, the highest price paid for either a Mercedes-Benz or an American car at auction and the highest price ever paid for a Porsche 911- probably anywhere in the universe.
When Christie's auctioned a Bugatti Royale back in 1987, the record price stood for over twenty years. Since 2008 it's fallen almost every year, each time to a Ferrari. To quote our words this time last year: "At least for now the party looks set to continue..."
1957 Ferrari 250 Testa Rossa- sold for $16.39 million (Gooding), a new world auction record for a car
OK, let's get this out of the way first of all: it was toasted, not once but twice, and neither was a pretty sight. But the fact remains that it's the prototype of Ferrari's greatest sports-racer of all time; it ran as a works car and took part in legendary events such as Le Mans and the Targa Florio (unlike many of its sisters which were busy circling old airfields in SCCA races) with stars such as Hill, von Trips and Gurney behind the wheel; it's still got its original engine and a unique prototype chassis; it's been beautifully restored and certified by Ferrari; and last but not least, it came from one of the world's most respected collections. Consider that a lesser 250TR was auctioned in May 2009 for $12,168,000 and that owners of the very best TRs have received private approaches north of $20 million, and this result makes perfect sense. It's interesting that the 73 year old underbidder, who spent $11 million this weekend, had never bought an old car until earlier this year.
1937 Mercedes-Benz 540K Special Roadster- sold for $9,680,000 (RM), a new auction record for a Mercedes-Benz
The 540K Special Roadster is to many the ultimate Mercedes-Benz road car, and certainly the most flamboyant, but just three left-hand drive cars are known to feature all 'the goodies': long tail, enclosed spare, and high doors to give the sleekest look. This was one of them, and in better-than-new condition- it won Best of Show at the Amelia Island concours last year. The owner had declined offers in this region before choosing the auction route. For the best of the best a slightly higher figure wouldn't have been out of place: we say well bought.
1931 Duesenberg Model J 'Whittell Coupe'- sold for $10,340,000 (Gooding), a new auction record for an American car
This was a lesson in auction marketing and what can happen when it all comes together. A unique, custom bodied Model J built for a prominent US playboy, it was acquired by the vendor not many years ago from another auction house for a figure in the $2.5 million range. When he offered it back to them for $6m they perhaps understandably declined and suggested a reserve of $3.5m. Undaunted, the vendor went to Gooding and hit the jackpot. The car was about to be hammered sold at $6m when the underbidder had second thoughts and the battle restarted, ending at over $10 million with commission. Expensive but unrepeatable, and the buyer can afford it- he took home one of the other big ticket cars above this weekend as well.
1966 Ferrari 275GTB Alloy- sold for $1,540,000 (Gooding)
As a judge of the Post-War Preservation Class at Pebble Beach, I often point out that preservation doesn't equal neglect. There are still plenty of cherished cars from the 1960s with their original paint and leather, often looked after by the same family for generations. This wasn't one of them; it had languished in long term storage at the back of a mechanics shop, from where a US dealer had recently purchased it...for about half what it made soon afterwards in the auction. Low-ish mileage perhaps, but they must have been bank getaway miles. It'll be interesting to see if the next one comes anywhere close to this price.
1970 Porsche 911S- sold for $1,375,000 (RM), a new auction record for a Porsche 911
Infact a new record for any 911, anywhere, and likely to stand for a very long time unless someone discovers a barn full of ex-Steve McQueen Porsches. For this much the King of Cool might even be tempted to make a comeback himself.