Classic car auction sales expectations

The world of classic cars is undergoing a significant shift, with the market experiencing a decline in sales and a change in buyer demographics. The recent Monterey Car Week, held in California, saw an estimated 1,140 classic cars go up for sale, with total sales expected to reach between $367 million and $409 million. While this figure is still impressive, it represents an 18% drop from the peak of $471 million in 2022.

The high-end market, in particular, is feeling the pinch, with fewer cars priced at $10 million or more being sold. In fact, this year’s auction saw only one car in this price range, the fewest in over a decade. The average sale price has also decreased, from $477,000 last year to $473,000 this year. According to Simon Kidston, a classic car advisor and dealer, “Pebble Beach is the annual health check on the market. Everybody waits to see what happens at Pebble Beach before committing to a major decision the rest of the year.”

Market Trends and Challenges

The collectibles market, including classic cars, has been experiencing a slowdown since the pandemic rally in 2021 and 2022. The Knight Frank Luxury Investment Index reports that collectibles prices have dropped 2.7% over the past 12 months, with classic car prices declining 0.2% overall. This decline can be attributed to various factors, including global uncertainty, higher interest rates, and a surging stock market. However, experts believe that the main reason for the slowdown is a generational shift, with baby boomers aging out or downsizing and millennials and Gen Zers looking for newer and more affordable collectible cars.

McKeel Hagerty, CEO of Hagerty, notes that “it’s a big rotation. Some of the older-guard collectors are framing it, ‘The market is soft at the top end.’ But there’s a lot of depth in this market. It’s just rotating to younger buyers and newer cars.” This shift has led to an oversupply of 1950s and 1960s cars, resulting in falling prices. Many baby boomers are trying to sell their cars, while others are passing them down to their children, who may not share the same passion.

Top Lots at Monterey Car Week

Despite the market challenges, some exceptional cars were sold at Monterey Car Week. Gooding & Co. sold three Ferrari 250 GT California Spiders, including the most expensive lot of the week, a 1961 250 GT SWB California Spider with an alloy body and original hardtop, estimated at over $20 million. Other notable sales included a 1993 Ferrari F40 LM, sold by RM Sotheby’s, estimated at $8.5 million to $9.5 million, and a 1973 Ferrari 365 GTB/4 Daytona Competizione, sold by Gooding & Co., estimated at $8 million to $10 million.

Interestingly, sales of modern supercars, defined as those from 1975 or later, are expected to overtake sales of “Enzo-era” Ferraris (made before 1988) at Monterey for the first time. This trend is driven by younger collectors who prefer newer, more affordable, and practical cars. As Kidston notes, “if it’s all solely reduced to what is more saleable, then collecting becomes very superficial. I don’t believe collecting should be ruled by investing. You should keep an eye on the financial implications of what you buy. But it should not be the be-all and end-all.”