The most drastic sign that the vintage Ferrari market is weakening

Le Monde Edmond | Pebble beach auction results 2016

 

He says, "Right now it is a clear buyers market." Well, don't buy yet...

 

Paragraph #5 and "sellers' expectations" seem key to this article. Time will tell.

 

May be some people who know, should check more on the issues of the TDF. This car was offered for sale during winter/ spring by the same people who sold it ( at least those who were there then,,) and the asking price was in excess of 10m USD. All offers were deemed not enough. So something has happened and not only market views on what seem to be on the outside one of the best looking early TDF bar the 14 louvers car.

We know this car had several accidents and several, at least 3 I can count, modifications of the body. May be less parts of this body are original than people think. And while the Alfa 2.9'from same stable was sold, but chassis does not have anymore a chassis number stamping as the car had lost its front cross member where the Alfa chassis are stamped when a V8 engine was inserted in Argentina,,,we know any alteration of this sort would have been lethal for a Ferrari.

So if anyone had inspected the TDF, and we heard of rumor circulating in the selling room, it would be interesting to know what are they based on, clearly today due diligence before buying a car with some issues is much deeper than before, this is also a sign of market cooling,,,

 

What I meant by a 'buyers market' is not that you should go out and buy blindly but rather that right now buyers can dictate the prices they want more or less. That was not the case a year ago. I think now the buyers have the power and not the suppliers (owners, dealers, auction houses, brokers, consultants, traders).

Maybe I should clarify that in my article.

 

I have many issues with articles like these, where do I start. Perhaps that there is not "one classic car market". There are many, at least a dozen main categories and many subcategories. This article just deals with one or two, both in the top segment.
As concluded in another thread, top segment prices in 2014/2015 suddenly became very inflated. We now see some correction from that but to call a correction for the entire market is just wrong. Its like saying the real estate market is going down because that super-rich apartment that was sold stupendously high two years ago for $80m now fetches only $65m.

 

I like Le Monde Edmund but I think his timings are way off IMHO. I think Ferrari prices (250, 275 etc) fell about a year ago, starting around the time of last summers auctions. I agree the fall was 20% but based on prices I have seen they have been stable at this level for the last 6 months at this level. I was pleasantly surprised by the auction prices. Estimates were too high _ they were the same estimates coming into last years auctions, which in most cases weren't met then either. I agree a good lusso was a 2.4m USD car 2 years ago. Last year is was a 2m $ car and it is around about that now for the best example

 

Still, he has a point... When there are seven SWB's known to be for sale right now that says a lot...

 

Its a very valid point. When I am talking classic car mkt I am talking about the high end of it. However I see price weakness right down to the 190SL, Dino's and 911s. It is the top segment I am looking out however - a fair observation on your part....

 

Probably we'll have a better picture of the situation if Marcel Massini will tell his opinion.

 

There are trends, fashions, frenzies, bubbles etc - and every market experiences them, both in the up and down direction. What I read in the results is that sports cars are less in fashion at the moment so some Ferraris and Porsches sell and fetch less in favour of lesser known brands and models, which often benefited from strong attention and money. No wonder I think for mass-produced 70's Porsches that imho experienced a frenzy, and as you correctly described same for the 250SWB and probably others.
So I do agree with you, interest has shifted. Question is, is it more than a change in fashion where one day everybody wants green, the day after it's red. It is notoriously difficult to call true turning points in markets, when is it more than a fluctuation and does it become a new trend or frenzy, up or down.

I believe a large part of the interest in art, classic cars and such isn't just vogue, it is also a complex of monetary origin, new wealth in new markets and new worlds, population growth and governments hunting for taxable wealth. All these factors fluctuate and that is indeed a very interesting subject to analyse; my current view is that a true turning point will not happen unless something changes on a fundamental level. Meanwhile it is fun to watch and participate.

 

Forget the noise, just look at the results. Market was down about 20 percent going in to that event. And now it looks to be falling slightly further, and big time ON THE MODERN HIGH PRODUCTION "CLASSICS".

And also note, there has been no financial meltdown, no war, no nothing. None of these things need to happen to make a ponzi scheme/pump and dump fall down. Gravity takes care of that on its own.

 

+1

 

Perhaps the classic car market is waning, but there is no doubt that the "specially car" market is booming. New.Ferraris cost $250-$500k, and several manufacturers are selling out of all their $500-$1.5M super cars, offered in 500-lot increments, one offering after the other. I would never have imagined the new car market could absorb the many millions of dollars collectively spent on all these accessories.

I fully understand that the two markets are distinct, but I'd venture to say that a $150,000 1973 Porsche 911 suddenly doesn't look all that expensive when parked next to a fleet of the latest Porsche offerings.

 

Very good observations..

I think that in part the market for new supercars is being buoyed somewhat by the frenzy in the "classics".. That is, in the past cars ALWAYS depreciated, and the more expensive ones just depreciated more. Now we have a situation where some super cars (like a LaFerrari) aren't depreciating, even in a few years the buyer is finding that he can sell the car for more than he paid for it.

With no real depreciation penalty there are a lot more buyers for super cars than there would otherwise be. The problem is, are there that many buyers for used supercars and will the prices hold??? That's a huge gamble that I'd probably not want to bet my retirement savings on. If prices on these super expensive cars starts to fall, the market for both new and used ones could slide down in a hurry. OTOH, it may well happen that the prices hold and there are enough folks who wanted one in the first place and couldn't get one and that could support prices for a while.

Lots of scenarios where the prices could go up or go down or just muddle along.

 

This question is getting ready to play out in the 2017 Ford GT arena where Ford will be releasing about a car a day until hitting the 500 unit production ceiling. Since 70% of the lucky future owners were existing previous generation Ford GT owners, there is considerable speculation that some of these 2017 owners will need to dispose of their existing GTs and that this might undermine prices for the older cars which have generally appreciated since new (see FerrariChat/Other Cars/American Muscle for that discussion). So far, there has not been a jump in the number of older Ford GTs for sale since chosen buyers have not yet received a firm delivery date and cash call for ~$450,000.

 

This is it...

All the sellers swing for the fences.....and many strike out, in doing so.