In-person auctions haven’t gotten back to where they were before the pandemic. That’s probably a good thing.
Last week represented a significant milestone in the collector car market’s return to pre-pandemic normalcy, with large in-person auctions taking place in conjunction with a major concours in Amelia Island. Look at the photos of crowds milling about the fine vehicles and, unless you happen to squint and spot someone wearing a mask, you’d think it was 2019 or early 2020.
The numbers, however, tell a different story. The auctions that went ahead in Florida, by RM Sotheby’s and Bonhams, offered 57 fewer cars than they had last year. This isn’t an aberration. The in-person auctions that have returned in 2021 have offered 23 percent fewer cars than in 2020. Mind you, this excludes auctions that haven’t returned at all or that have stuck to an online-only format, as Gooding & Company, for instance, did for Amelia Island this year.
The contraction probably has a few causes. For most of 2020 through early 2021, the simple logistics of getting cars—flying to meet clients and personally inspect cars—was difficult. On top of that, some sellers were reluctant to expose themselves to an uncertain market. In recent months, traveling has eased and it’s become clear that values aren’t tanking (it’s quite the contrary); however, auction houses now face more competition than ever from online platforms and from classic car dealers, both of whom gained ground in the past year, while the in-person auctions were mostly sitting out. Last but not least, the auction houses are perhaps being more selective than they have in recent memory, accepting only cars they reasonably expect to sell.
This might sound like bad news for auction companies. It’s not. Remember that before the pandemic, the big story around the in-person auctions was that they’d become too big and too numerous. The 2019 Monterey auctions performed particularly poorly, with swarms of cars failing to meet reserve. At the time, we speculated smaller, better curated auctions would perform better. Certainly, we were not envisioning a year of lockdowns with hardly any in-person sales. But the new, slimmed-down auction scene is indeed more profitable. Overall, sales are up 11 percent, with average selling price rising 23 percent. Some of that is likely due to pent-up demand. Yet it’s also pretty clear that at least as far as in-person auctions go, smaller really is better.
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