It has been some weeks since the last Collectible & Classic Car newsletter mostly because we wanted to see the European spring auctions play through and also because we have been readying for the launch of the our Classic & Collectible Car Investment Fund which launches at the end of this month. As always, if you have any questions please feel free to call or email.
You can also visit the website Tangible-am.com to get more information on services offered.
Market News
Auction sales are of a mixed bunch, but with a clear trend, that sell through rates are now way off their highs (90%++) with something in the order of 60-70% being done on the hammer. As has been said here on many occasions the market is crying out for sensible estimates and until the auction houses/sellers begin to realise this don't expect to see any improvement.
Of course it is the top of the market where the estimate spreads and unrealistic reserves are at their most extreme, so rightly, buyers in this stratosphere are being most cautious and it is the area of the market strongest hit. Big dollar Ferraris are said to be 20%+ from where they were !
HAGI’s Index data shows the mix at play in market results. Porsche prices have run dramatically in the last 24 months. Certainly this looks like the beginning of a step back in the market overall for Porsche but expect there to be still a strong demand for the rare models and stand out examples.
Meanwhile the HAGI TOP index with out the inclusion of Porsche or Ferrari saw a jump over 5% for the month ! With these marques included performance was less but still positive at 0.75% for the month.
*HAGI Inception values £100 on 31.12.2008, **HAGI MBCI £100 on 31.12.2011
1. The HAGI Top Index is our overall market measure for exceptional historic automobiles.
2. The HAGI P Index is measuring the rare Porsche automobile market.
3. The HAGI F Index is measuring the rare Ferrari automobile market.
4. The HAGI Top ex P&F Index represents the HAGI Top Index without Porsche and Ferrari.
5. The HAGI MBCI measures the market for classic Mercedes-Benz automobiles (from 2012).
Brexit
Ok we can’t talk markets with out mentioning Brexit. UK buyers, a significant percentage of whom are true enthusiasts, have been a powerhouse in the collectible car market. Brexit, as we stand today, sees their 2016 purchasing power, against the USD & EUR, being hit by 10-15% compared to that in 2015. So what does this mean for the future?
Well not having a crystal ball means we can only give an opinion. One can take the view that sterling denominated cars have just got that much cheaper and certainly warrant close examination for those who live in “Right Hand Drive” markets.
Do sterling based buyers now step out of the market? Short answer is no, well not the enthusiast. The enthusiast market has always side stepped economic tides and the savvy investor may find the humble motorcar a fine storage of wealth in times of economic upheaval.
2008 economic flux saw the global money printing presses kick-in to play and given Brexit maybe catalyst to further pressure on the euro, it is likely stimulus in size will be delivered to relieve markets. All that cheap money will need to go somewhere! Certainly what is clear, is that it is a buyers market and today’s buyer is a lot more discerning than before. What is needed however is for sellers to realise this and price their cars accordingly.
 Monterey is but weeks away and will prove a good litmus test for the market postBrexit. There are some important cars coming to market, not least CSX 2000 – the first Shelby Cobra.
Opportunities like this do not come around often, so expect a very special car to fetch a very special price. For cars such as this, and indeed those further down the exotica food-chain, the question is will bidders from the UK be participating or is it a case of "see EU later"?
Trends
One trend continuing to play out first half of this year is that of the continuing demand for cars of the ‘80s era onwards. Hagerty in a note remarked on this after the 1st quarter and the RM sales at Monaco in mid-May further represented this.
 The exclusive 2004 Aston DB AR1 sold for an auction record of €336.000 whilst at the same auction a 1995 Lamborghini Diablo SE30 Jota smashed the high estimate to bring home €672.000 —again another auction a record.
Notably the ultra rare and beautiful 1968 Ferrari 275 GTS/4 NART failed to reach anywhere near its lower end estimate of €19,000,000 – a conspicuous no sale !!
“All the auction houses have been subjected to a drop in sale rates, and we must all adapt to the market trends,”
Group Director of the Bonhams Motoring Department, James Knight. March 2016
Another trend worthy of note is that of the strong demand for important historical competition racecars. “POV 114” the ex- Le Mans Jaguar C-type came out of 53 years of private ownership and sold for €7.25m whilst the ex-Michael Schumacher and Nelson Picquet €1.05m, both exceptionally strong results for Bonhams at their May Monaco sale.
More recently, at the weekend, the Herve Poulain 1977 Porsche 935 sold for €1.3m at Artcurial’s Le Mans Classic sale. The enthusiast wants to go racing and the 935 certainly scratches that itch.
Alfa Romeo
Few manufacturers evoke the passion, as does the legend Alfa Romeo.
The air of nostalgia is thick and could not come from anywhere else other than Italy. Alfa’s heady mix of past racing glories, achingly beautiful cars matched with technological excellence, making legends of both men and cars.
 Every enthusiast knows and desires Alfa, despite the junk that has worn the badge in recent memory. Despite this, there have been signs over the years that somewhere within, the beating heart Alfa remained – for example the 8c Spider built in limited in number for thee years from 2007. So Beautiful with an epic exhaust note it proved Alfa still had it.
 Today it looks like the beginnings of a renaissance with the 4c lightweight Carbon chassis sportscar and now the brand new Giulia Quadrifoglio a legitimate M3 competitor. This feeling of rebirth is fuelled further by Marchionne, the President of Fiat (Alfa’s parent company), as he is making more frequent and louder noises about Alfa reigniting its F1 roots
With excellent new cars coming to the showrooms and a resurgence of Alfa on the racing track you can expect the brand to flourish quickly. In turn expect the desirable Alfa’s of old and not so old to have renewed attention from the market.
|
