Monterey Car Week is a highly anticipated event in the world of classic car auctions, drawing in wealthy collectors and enthusiasts from around the globe. However, this year’s event saw a slight decline in auction sales, with a 3% decrease from the previous year. The shift from older to newer cars has resulted in a surplus of classic cars from the 1950s and 1960s that are struggling to find buyers.
According to Hagerty, a classic car insurance company, total sales at this year’s five car auctioneers in Monterey amounted to $391.6 million, down from $403 million in 2023. This decline follows a 14% drop from the peak of 2022. Of the 1,143 cars up for sale, only 821 were sold, resulting in a 72% sell-through rate. The average sale price also saw a slight decrease, falling to $476,965 from last year’s average of $477,866.
Experts in the industry attribute this decline in sales to an oversaturation of similar cars at multiple auctions, leading to weak prices and sales. Simon Kidston, a leading advisor to wealthy car collectors, noted that many of the cars on offer had been on the market for extended periods, making it challenging to generate interest among buyers.
One significant trend that has emerged is the preference of a new generation of collectors, mainly Gen Xers and millennials, for cars from the 1980s, 1990s, and 2000s. This shift in taste has resulted in a lower demand for classic cars from the 1950s and 1960s, which have traditionally been popular among baby boomers. As a result, the sell-through rate for pre-1981 cars priced at $1 million or more was only 52%, compared to a much stronger 73% for newer cars.
Hagerty’s Supercar Index, which tracks sports cars from the 1980s through the 2000s, has seen a significant increase of over 60% since 2019. In contrast, the Blue Chip Index, which focuses on classic cars from the 1950s and 1960s, has experienced a 3% decline. This shift in market preferences is evident in the types of cars that are commanding top prices at auctions.
While a select few rare and exceptional cars still fetch high prices, such as the 1960 Ferrari 250 GT SWB California Spider that sold for $17 million, the overall market for older classic cars is facing challenges. As many older collectors begin to sell off or downsize their collections, prices for older cars are likely to remain under pressure for the foreseeable future.
The changing landscape of the classic car market is also influenced by external factors, such as high-interest rates. Rising rates have raised the opportunity cost of investing in classic cars, leading some buyers to reconsider their purchases. The investment angle of collector cars, which has been a significant driver of value appreciation over the years, is now being scrutinized more closely by potential buyers.
In conclusion, Monterey Car Week serves as a barometer for the classic car market, reflecting shifting preferences among collectors and the impact of external economic factors. While the event continues to attract high-net-worth individuals with a passion for vintage automobiles, the dynamics of the market are evolving, signaling a new era for the world of classic car auctions.