What we learned from the 2019 Arizona auctions
This was my 27th Arizona auction week—which is what’s it’s now called, years after it was simply “Scottsdale” and consisted of a much-smaller Barrett-Jackson (ah, how I miss the mud pit years) and the now-gone Kruse Auction carnival affair, held in the equally superficial Wild West park. If some of those blanks they used to shoot at attendees upon entry were actually real, I could have avoided a few bad deals.
The new Arizona auction landscape is rather immense, with no fewer than seven auction companies offering a whopping 3294 cars (this year) over a 10-day period, with 81 percent of them finding new homes. But even in those years when Scottsdale had far fewer auctions and far fewer cars, it has always been considered an important market barometer for the year to come—even with Mecum Auctions beating Arizona to the punch by holding its blockbuster Kissimmee Florida sale, which brought in $93.7M and sold 2173 cars, the weekend before.
After being on the ground at every auction and watching the 10-day “week” unfold, here are seven takeaways:
1. Scottsdale is not Monterey
While the big European auction houses now have a marked presence in the desert, and bring high-end European offerings, Arizona remains at its core a meat and potatoes, red, white, and blue venue. Muscle cars reign supreme, as do full classic and 1950s American cars. If I were selling a 250 SWB Ferrari or a modern Italian supercar, I’d be waiting for August and shipping it a little further west.
2. The Radwood Effect
The market is changing, evidenced by continued growth in unique cars of the 1980s and ’90s. If it was cool and fast then, it is a hot collectible now. Call it the Radwood Effect or simply buyers new to the market buying what they couldn’t buy when they were younger. Stuff we used to look at as “daily drivers” are now collectible cars. For example, I think I wholesaled at least a handful of 1993 Mustang Cobra Rs back in the mid-’90s. One sold for $132K at Barrett-Jackson last week. Guess I should have put at least one of my old ones on ice, huh?
3. Stale inventory is a hard sell
I witnessed a number of auction block “frequent fliers” in Arizona. They either had owners that finally adjusted their expectations of price and sold them, or they simply loaded them back into the transport truck. Again. Fresh-to-market cars are what buyers want. It doesn’t mean a car that has been on offer for a while is a bad car; quite often there is nothing wrong with it at all other than the price. But it certainly does scare buyers away. Here’s a tip: Rather than not bid because you think the seller won’t cut loose of a car you’ve seen before, stick around as it crosses the block. You might just end up being in the right place at the right time to snag a bargain.
4. Those $1M cars just… weren’t
Many comments were overheard regarding the fact that there were not a lot of “great” cars in Arizona this year and I’d have to agree. There just weren’t a lot of lust-worthy multi-million dollar feature cars this year, and the general quality of consignments overall seemed lackluster, which I suspect in turn kept a lot of the big collectors I’m used to seeing from showing up in Arizona. And the results speak to this as well, above $1M it was tough sledding for the auctioneers. Is this lack of inventory a result of sellers knowing the upper end market is soft right now, or were they just unwilling to ship their cars to Arizona? Time will tell.
5. LaFerrari Apertas are not the instant collectibles that speculators hoped
Now that owners’ “no sell” agreements with Ferrari are expiring, Apertas are hitting the secondary market. Mecum failed to sell the one on offer in Florida, and RM/Sotheby’s missed on the one it offered in Arizona. I guess they aren’t the $8M cars every original owner hoped they would be. And, overheard at RM from a potential Aperta bidder: “I’d rather spend just $3M and get another LaFerrari coupe than to spend $7M and have an Aperta as my second LaFerrari.” Hey! That’s exactly why I didn’t bid. Well, almost exactly why.
6. Barrett-Jackson remains the well-oiled machine of the week
Barrett has more cars, more bidders, and a bazillion more speculators than any other auction and still make it look effortless. Oh, and with only ONE no-sale out of 1818 cars, the sell-through rate was 99.9 percent. Granted, B-J is largely a no-reserve auction, but sales prices were overall very strong, and in a week filled with auctioneers struggling to “get the money” all over town, the team really proved that there is strength in numbers—and in carefully curating a run list. Gone for 2019 were the stodgy “Salon” cars, and a lot more resto-mods, SUVs, and emerging collectibles. Well played, Barrett-Jackson.
7. January 2019 was a pretty good month
Moving forward we’ll see what the Amelia Island auctions have in store for us, and how they fare, then I’ll also be keeping a close eye on Mecum’s humongous Indy sale in May. For now, after witnessing Kissimmee and Arizona, which saw the market absorb more than 4800 cars combined, I’d say 2019 will be a pretty good year no matter what side of the market you’re on.