After Pandemic Boom Times, Collector Cars Are Finally Cooling
Auction houses still did gangbusters in 2022, but 2023 could be a different story
If you only look at Bring a Trailer, you’d think the collector car market was still riding the years-long pandemic boom. The online auction site, which was acquired by Hearst in June 2020, has seen well over a 50% increase in year-over-year sales in 2022, eclipsing $1.3 billion as of mid-December compared to over $859 million in 2021, according to company data. One data point does not a trend make, unfortunately.
Back in October of this year, in its analysis of classic and exotic car auctions, Classic.com wrote, “…we are seeing signs that prices are stabilizing from the consistent climb seen since mid-2020, which mostly translates as the stabilization of the overall specialty car market.” And now those signs have become reality.
According to Hagerty, the automotive lifestyle company that provides classic car insurance and accompanying data and analytics for the segment, the collector car market is seeing its first consistent signs of slowing since the beginning of the pandemic.
“The Hagerty Market Rating, our holistic measure of the ‘heat’ of the market, dropped for a third consecutive month, to its lowest point since January 2022,” the company reported on Friday. “This marked the first time the rating has dropped three months in a row since March 2020.”
Is this dreaded inflation taking its toll? A sign of a recession to come? Did everyone who wanted a Porsche get their Porsche and now all these blissed-out Porsche owners are just happily bombing around their neighborhoods with not a care in the world for continued market growth?!
There are no red alerts here. As inflation continues to ease in the U.S., that’s not cited as the single culprit in this slowdown (though it certainly affects areas like appreciation and median sale price). Instead, it seems the specialty car arena, which was overdue for a reality check, has simply started to come back down to earth.
The key word there is “started.” While we are seeing month over month decreases in the so-called “heat” of the market, as Hagerty notes, “the current [heat] value of 75.85 still remains in the ‘rapid expansion’ section of our 0-to-100 scale. That may sound odd but actually helps put our current ‘lull’ into perspective: The market remains blistering hot compared to previous years. The performance of the classic car market going forward will depend a lot on whether sellers agree with that perspective — or if they try to cling to the summer highs.”
In short, don’t expect top-tier lots, like the rare 1969 Corvette ZL-1 Convertible heading to the auction block in January, to gather dust even if most buyers aren’t as bid-happy in 2023.
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