The collectible car market faces its most significant test of the year this week as up to $400 million worth of classic vehicles are auctioned during Monterey Car Week in California. The event serves as a crucial barometer for the health of the market and the sentiment of its wealthy collectors.
An estimated 1,140 cars are projected to generate between $367 million and $409 million in sales, according to classic car authority Hagerty. The midpoint of that range, $388 million, would represent the third consecutive year of declining sales and an 18% drop from the 2022 peak of $471 million.
The slowdown is most pronounced at the market’s high end. For the first time in over a decade, only one vehicle is expected to surpass the $10 million mark, a stark contrast to previous years which typically featured half a dozen such offerings. The average sale price has also dipped slightly to $473,000 from $477,000 last year.
“Pebble Beach is the annual health check on the market,” said Simon Kidston, a prominent classic car advisor and dealer. “Everybody waits to see what happens at Pebble Beach before committing to a major decision the rest of the year.”
Like other high-value collectibles, the classic car market has been cooling since its pandemic-era rally. Analysts attribute the downturn to global uncertainty, economic weakness in China, and rising interest rates, which increase the opportunity cost of owning a multi-million-dollar vehicle.
However, experts contend the primary driver is a profound generational shift. Baby Boomers, who have long powered the market, are downsizing their collections. Meanwhile, a new wave of Millennial and Gen Z collectors are entering the hobby with different tastes.
“It’s a big rotation,” said McKeel Hagerty, CEO of the eponymous insurance and events company. “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 rotation has created an oversupply of vehicles from the 1950s and 1960s, with prices falling by as much as 20% to 30% from their peaks. An unusual trio of Ferrari 250 GT California Spiders is up for sale this week, including the event’s top lot: a 1961 alloy-bodied model estimated at over $20 million. Just a few years ago, Kidston notes, it likely would have commanded $25 million to $30 million.
Falling prices are also pushing more high-value transactions into the private market, as prominent sellers seek to avoid the public record of a discounted auction price.
In contrast, demand for newer supercars from the 1980s, 1990s, and 2000s is soaring. Younger buyers favor more practical and modern Porsches, BMWs, and later-model Ferraris over pedigreed but temperamental classics. The shift is evident in the auction catalogs, where the average model year has advanced from 1964 two years ago to 1974 this year. For the first time, sales of “modern supercars” from 1975 or later are expected to surpass those of pre-1988 “Enzo-era” Ferraris.
This surge has some experts worried about a speculative bubble, with Kidston cautioning against treating cars purely as investments. “If it’s all solely reduced to what is more saleable, then collecting becomes very superficial,” he said. “It should not be the be-all and end-all. Otherwise it just becomes like bitcoin.”
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