Hershey Bust

Car collector client just returned from Carlisle and Hershey meets. Told me Hershey meet was a bust. Most cars did not sell. Cars under $100K must be sold with no reserve and he said some cars estimated at between $40K and $60K sold for $18K. One vendor said he was averaging $2000/day. In past years, it was $15k to $20K. Maybe it's time to get the speculators out of our hobby. Someone is going to be left holding the bag on those Ferrari's and Porsches.

Would the low number of sales indicate that the speculators are actually already getting out?

TM

Aging collectors & enthusiasts?

Interesting, thank you for the news. Would be interesting to know the list of sales. If I find some time, I will do some digging.

Here's the Sotheby's results list:

https://www.rmsothebys.com/media/68206/official-results-rm-sothebys-hershey-2017-lot-order.pdf

Doesn't look too shabby.

pdplot said:

Car collector client just returned from Carlisle and Hershey meets. Told me Hershey meet was a bust. Most cars did not sell. Cars under $100K must be sold with no reserve and he said some cars estimated at between $40K and $60K sold for $18K. One vendor said he was averaging $2000/day. In past years, it was $15k to $20K. Maybe it's time to get the speculators out of our hobby. Someone is going to be left holding the bag on those Ferrari's and Porsches.

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Something's out of whack here. Your client's anecdotal report doesn't jive with what I witnessed...or what the two auction houses are reporting on their web pages. Carlisle Auctions only started four years ago. While I didn't attend this year, I've seen in the past that the offerings can be a bit underwhelming to the hardened car collector (for example..an '85 Monte Carlo with a $10,000 reserve). But then there's always the special high interest somethings that go across the block. Here's their comment: "Fall Carlisle 2017 has come and gone and this three-day affair was one for the record books." They also reported a $1 million increase in sales compared to Fall '16. Now as for the swap meet, it pales in size comparison to the AACA's Fall Meet (Hershey) and this year was no different. With the AACA reporting there are 9,000 vendor spaces, I never get to see everything...see photo below, and it always amazes how many foreign languages you hear as you walk the aisles. Good weather this year meant the place was packed (I went Thursday).
As for RM Sotheby's Hershey Auction, they reported a 94.85% sell...136 cars offered, 129 sold. I attended one of the nights (as a spectator) and witnessed some truly amazing offerings (a White Yellowstone Park Bus for example) but none would I say were stolen from the seller. For the vendor that did $15-$20K in past years, I would have to think that would have to be one of the largest of sellers...and I would guess probably selling automobilia. Some of the prices for perfect oil signage and restored gas pumps and air dispensers can be truly out of sight and only appeal to the very well off. Not certain why their sales would suffer such a downturn. My only negative comments to friends was I didn't see many bargains in the car corral. What some feel the value of their vehicle is truly out of whack. Finally, while there's no question the old car hobby is dominated by senior citizens and yes, Model A's have become a bargain, I think it's still too early to talk of its demise.

I agree those prices don't look too bad but I also don't know what the pre-sale estimates were. This guy is an experienced collector specializing lately in Packards and muscle cars. He's been going to these things for years. His father specialized in brass vehicles up to 1920. I'll email him with a question about the Hershey values.

Just got the Hershey catalog. Will go through it and analyze prices. Quick look reveals that most cars did not meet their estimated prices, a few were spot on and very few brought more, including that Yellowstone bus, estimated at $30K-$40k, it brought $150K. Virtually no sports car or LBCs. An MG TC formerly owned by race driver Jim Hall, estimated at $25K-$30K brought $19,500.00 while a 1958 Morris Minor convertible listed at $15K-$20K hammered for $23K, a Nash Metropolitan (getting desirable!) at $30-$40K sold for $67,500.00! and a Jag XK 140MC for $125K-$150K went for $126K. There were also memorabilia lots and pedal cars most of which my guy didn't put down their selling price but you could look it up on the result sheet posted above. Older American cars were the biggest disappointment. I'll post my results after I wade through the very fancy color catalog.

OK. My guy did not stay until the end of each day, but here are the results of what he did see. Of the 110 cars he saw go on the block, 63 did not meet the minimum estimate, 24 were spot on, 13 sold for more and 10 did not sell. Other interesting cars were: Isotta-Fraschini $400-500, sold for $275K, 1930 Austin Seven $20K-$30K sold for $15K, Fiat 850 Spider - a charity auction ,estimated value "anyone's guess" went for $22K, a 1932 Duesenberg listed at $750K-$1 million sold for $540K, Chrysler Town & Country $90K-$120K sold for $68K, Mercedes 450 SEL sedan at $15K-$20K brought only $7K, a beautiful 1934 Alvis Speed Sports Tourer, the only one in the US, at $150K-$200K went for $142,500.00.A Ferrari and a beautiful Pierce Arrow did well, exceeding their estimates but not by that much. There had to be a lot of disappointed owners - and don't forget the 10% commissions paid by buyers and sellers, plus $200 fee to be a bidder. If you look through the auction results and see a sale result you are interested in, let me know and I'll look up the estimate for you. So the bloom may be off the classic car market if the Hershey results are to be the norm.

I noticed that the prices shown on the published results posted above include the 10% buyers commission. This does not go to the seller of course. Add in the cost of shipping the car to the auction, going there yourself, transportation and hotel bills, shipping the car back if it doesn't sell, a fee for entering the car, sellers commission (you don't think Wayne Carini or the owners of those $$$ Ferrari's don't have a special deal), no reserves for cheaper cars and who do you think gets the prime time slots...

Thank you very much for the details!!!

pdplot said:

....Told me Hershey meet was a bust. Most cars did not sell...

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It was these two sentences that drew me to this thread. Mostly because a quick search showed that out of 136 cars that RM Sothebys ran across the block, 129 sold. Then when the conversation turned to selling price vs. pre-auction estimates, I did a search on the accuracy of auction house estimates. This is from the 2014-2015 Classic Car Auction Yearbook: "Collectors, dealers, agents, auction houses and a few observers pick through the entrails of transactions and auctions seeking the portents of trends in the market. To many there is never enough information, and certainly not enough cogent information, to divine the future before it becomes the present.The uncertainty is manifest in the frequently wildly erratic pre-sale estimates of auction companies. If they – and their consignors – had a clue what buyers’ attitudes were most transactions would fall within the estimate range. Yet a superficial look at 22 mostly US-based sales with published pre-sale estimated in 2015 shows the following rather scattershot result:

• The total cars offered with pre-sale estimates were 2,544;
• 238 of them sold on hammer bids (not including commissions) over their high pre-sale estimates, 9.4%;
• A remarkable 1,689 of them sold on hammer bids under their low pre-sale estimates, 66.4%;
• That leaves only 617 that sold within the pre-sale estimate range, 24.3%.

A hedge fund with that kind of performance would be out of business even before it started. A horse race tout who claimed to be close to correct in the same proportion (just over a third) would find it hard to sell a tip sheet." https://www.sportscardigest.com/classic-car-auction-yearbook-2014-2015-book-review/