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I always look forward to Sports Car Market being delivered every month and I usually read it cover to cover in a few sittings. I like reading the auction results and commentary. I am on Bring A Trailer almost every day and periodically review the Hammer Price app which gives high bid and sale amounts for most every collector car live auction. I scan through all of these results looking for trends and 'outliers' - which may be the start of a new trend. I form various hypothesis, and then have fun seeing if my predictions are accurate.
When looking at the September Sports Car Market, I couldn't help but think that Bring A Trailer was realizing higher prices than the equivalent cars sold at live auction. The average auction price on Bring a Trailer is around $USD50,000, and maybe only 10% of the offerings on that platform sell for more than $500k. That said, vehicles in all the price ranges, even the $1M+ cars, seemed to sell for more.
Do the hundreds of photographs, videos and forum commentary add more to a cars value than seeing the car in person at a glitzy auction? At what point do the live auction fees pay for themselves by tapping into the collector networks that Gooding & Co or RM Sothebys provide? Which cars are likely to do better on Bring A Trailer vs. live at Monterey?
It looks like after the last several years of uncertainty, the wealthy owners of the 'big' cars have decided the time is right to sell. A look at the auction catalogues for the upcoming Monterey auctions reveals only a handful of cars under $100k. I think the average sale result from the RM Monterey auction could be north of $750k this year - it has been in the $400k range in previous years.
It appears that the high end auction houses are moving up market for their live auctions and leaving the sub $250k cars to Bring-A-Trailer and their own on-line auction competition.
If this does indeed prove to be the case, it won't be much of a surprise. The live auctions have significant fees - usually an 8% sellers fee and a 10-12% buyers fee. For a Canadian car duty has to be paid (if it wasn't built in North America) and it has to be shipped to the US. On a $USD 100,000 sale result, the buyer would net perhaps $CDN 114,000 if it were a North American car and $110k if it were European. If the car doesn't sell you have more expense bringing the car back home - although this is unlikely as the auction companies will insist on no-reserve in this price range.
Canadian cars sell at a discount on BAT because the US buyers are reluctant to go through the trouble and expense of importing them. A US buyer at Monterey or Arizona can take the car home right away but has to pay a 10% or 12% buyers fee. If you sold the same car on BAT you would probably realize the same selling price, but net close to $130k.
At the very upper end of the collector car market, the high end auctions provide curatorial expertise and know where all the great collections are. Clearly David Gooding is the guy to sell your Silver Ghost or Duesenberg, and RM Sothebys is very well positioned to find a home for your vintage Ferrari.
The trouble with BAT is that you have to count on at least a few bidders being there the week you are selling your car. If it is a thin market - and the market gets pretty thin when you are talking about $10M cars - you risk just entertaining the peanut gallery. For some collector cars there may only be a dozen or so potential buyers in the world - to market the car you would need to be able to contact them. Not easy unless you are David Gooding or Rob Meyers.
Shopping at some of the live auctions may reveal some bargains on the relatively lower end cars. Shopping for a Porsche 356 Speedster for a client revealed the best deals from RM and Gooding's live events. Bidding on BAT was just too competitive. With these live auctions now catering to the ultra-wealthy, it is possible a few 'cheap' cars could fall through the cracks. I've seen several great buys at Gooding & Co for cars that the rich guys couldn't be bothered with...
My hypothesis is that unless you have something that is extremely rare and valuable, it would be better to sell your car on-line. To look for deals though, you may have more luck at the fancy auctions. Let's see if Monterey proves me right.
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