8 March 2011

State of the Hobby

For Every Two Steps Forward...
While the hobby rebounded, there were lingering signs of both progress and regress. Veteran auction reporter Phil Skinner noted the “loss of two major collector car publications and the changing face of those still in print.” In 2010, Car Collector ceased publication. Cars & Parts was also eliminated — it and six of its sister Amos Press “Enthusiast” titles were merged into a single publication titled Auto Enthusiast. Old Cars Weekly experienced significant change as it went from tabloid to magazine format.

Skinner, who covers auctions for many publications, including Kelley Blue Book, noted the success of the August Monterey, California, auctions, and the sale of Kruse Auction Park to RM Auctions. “[There were] $173 million in sales during the Monterey/Pebble Beach week,” Skinner said. That staggering number was shared between Russo and Steele, RM Auctions, Mecum, Bonhams & Butterfields, Mid America and Gooding & Company.

Back in Indiana, RM Auctions purchased the Kruse Auction Park. Collector car auction veteran Dean Kruse and his now defunct Kruse International company had been plagued by creditors (including unpaid consignors) and, as a result, attendance, bidders and consignors had dropped dramatically. In just 60 days, RM Auctions acquired the property, formed Auctions America by RM, improved the grounds and buildings, renamed it the Auburn Auction Park and attracted 880 consignments for a Labor Day kickoff sale under the direction of Auctions America president Donnie Gould.

Of the 880 lots offered, Auctions America called 409 vehicles “sold” for a hammer total of $12,109,400, with a 46-percent sell-through rating.

Events: Strength in Numbers
One of the strongest indicators of the hobby’s health comes from car show and flea market events. They’re the most accessible means of interacting in the old car world, because they’re held nearly every weekend in every state during the summer months. And 2010 was a good summer.

“This year, we definitely saw an increase,” said Lance Miller of Carlisle Events, which hosts 10 hobby events each year on the Carlisle (Pennsylvania) Fairgrounds. “Vendor wise, we saw a nice little uptick. Obviously, 2009 was not our best year, but in 2010, we saw a reverse trend.”

One of the most gratifying signs of strength for Carlisle Events was an increase in the number of show cars. According to Miller, show-field registrations “were up over 20 percent.” As he explained, “We played it cautious; we sat down and said, ‘We want to look at our expenses and keep them down.’ You don’t know if the economy is going to hold going forward.”

Similar levels of hobby participation were witnessed by the Iola Old Car Show in Wisconsin, held every July. In 2009, Iola saw 120,000 visitors to its car show field, car corral and swap meet (up from 100,000 in 2008). That trend reversed slightly in 2010, with 115,000 visitors, although executive director Joan Schultz had forecast numbers matching 2009’s attendance. “We were sold out of our 4,430 vendor sites weeks before the show,” Schultz said. “The show cars on display were actually up from 2009.” However, she continued, “The Saturday of our show, there were high winds and hail all around us.”

Auctions: Hammering Down
Measuring the state of the auction business simply boils down to counting dollars. In 2010, those dollars crept upward despite still-soft prices for muscle cars, which once claimed some of the highest sale prices among vehicles crossing the block. For example, the ever-popular 1969 Chevrolet Camaro Z28 in show condition hovered in the mid-$40,000 range in 2005–’06 and rose to the $60,000–$70,000 range during its peak of 2007–’08. In 2009, Z28s sold in the $50,000–$60,000 range and remain there, according to data recorded in Old Cars Report.

“In 2009, it seemed like people were afraid to spend money, afraid to buy a car, afraid to sell a car,” Donnie Gould said.

Dave Kinney, publisher of Hagerty’s Cars That Matter, concurs. “The old car market — like any market — hates uncertainty,” explained Kinney. “The upshot was that 2009 was the year of the extremely cautious buyer, and only the best of the best automobiles brought good money at auctions. Just one year later, the buyer was a bit less timid. Collectors, as well as investors, are a bit more sure of their investments.”

The statistics agree with both Gould and Kinney. The 2009 August auctions in Monterey had a combined total of $118 million in sales, compared to 2010’s healthy boost to $173 million — a gain of $55 million in sales.

According to Skinner, the economy has not completely rebounded. Kinney doesn’t disagree, but suggests that “the increased market stability is a trend, and barring unforeseen events, it should continue into 2011.”

Clubs: Passing the Torch
One of the biggest fears among clubs is “the graying of the hobby.” As a result, engaging youth in the collector car and truck hobby remains a high priority for national clubs, including the Antique Automobile Club of America (AACA).

“We are instituting a host of new ideas,” said Steve Moskowitz, executive director of the AACA. “Along with youth participant awards, a youth-targeted publication and junior and student memberships, we have plans to partner with Hagerty’s youth judging program.”

The AACA’s work may be paying off, if the Eastern Division National Fall Meet in Hershey, Pennsylvania, is an indication.

“There were people asking, ‘Did you see how many young people were here?’” Moskowitz said. “There were a lot during the week, in the flea market, in the car show. If this is any kind of a trend, that is a good thing.”

During 2010, Moskowitz noted a high level of activity club-wide, partially inspired by the celebration of the AACA’s 75th anniversary. “This year was off the charts,” Moskowitz said. “Almost every meet exceeded our expectations.”

Engaging youth in the hobby is also a priority for the Veteran Motor Car Club of America (VMCCA). “We are beginning a strategy of offering scholarships to kids that are in accredited restoration programs, like McPherson College,” said VMCCA president Dennis Holland. He also said the club is planning tours and shows around institutions with automotive related programs, such as McPherson College and WyoTech, to attract a younger generation. Holland’s efforts come at a time when the club is experiencing a 10-percent slip in membership over the past four years.

“We had an uptick the last couple quarters, but I’m not sure whether to credit that to the economy or other factors,” Holland said. “The long term trend hasn’t been up. It’s a problem for everybody, which leads me to believe it’s economic issues driving it.”

Where are we headed?
It would be easy to say that the hobby could only go up after 2009, but that’s not true. In a weak economy, many more people could easily have walked away from their collector vehicles as their finances became strained. Yet the gleam of chrome and the roar of a carbureted mill remained too strong for hobbyists to abandon.


To see this article in its original format, view the pdf version of the Spring 2011 issue of Hagerty magazine.

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