2017 Auction results show a mixed market

Three of the year’s four biggest auction events (Arizona Auction Week, Retromobile, and Amelia Island) have passed and 2017’s results continue stressing that entry-level cars are the strongest segment. More expensive options are a tougher sell.

Looking at Mecum’s gargantuan Kissimmee sale and the auctions in Arizona and Amelia Island, 5,123 vehicles went to new homes. While and additional 628 vehicles were offered at these three events compared to last year, 460 more of them sold, keeping the sell-through rate almost exactly the same at 76 percent. But despite the increased number of cars, overall sales totals actually decreased: $460.3M in total sales this year compared to $474.4M in 2016. This means that the average sale price dropped nearly 12 percent to $89,846.

Total sales for Kissimmee, Arizona and Amelia Island are down compared to the two previous years despite more vehicles being offered and sold.

More vehicles were both offered and sold at Kissimmee, Scottsdale and Amelia Island in 2017 than in any previous year, although both total sales and especially average sale price are down.

For the second year in a row, Mecum’s flagship Kissimmee auction took place before Scottsdale and sold $78.6M spread over 1,800 cars. Despite having 200 more cars than last year, Mecum was unable to match its $84.4M 2016 total, which included multiple seven-figure muscle cars. This year, numerous historic dragsters did quite well, but there were some big misses at the upper end.

Scottsdale was more successful. More vehicles were offered and sold, and the Arizona auctions collectively had an increase in total sales over 2016. At nearly $260M, it was the second-highest overall total in Arizona auction history. Despite an 11 percent drop in average price, there were nearly 12 percent more vehicles offered. Demand for vehicles valued from $250,000-$1M softened noticeably, but sub-$100,000 vehicles achieved strong prices. Dodge Power Wagons and Ford Broncos did particularly well at Barrett-Jackson, and over 80 percent of the Chevrolet pickups inspected by Hagerty in Scottsdale sold for more than their condition-specific HPG values.

Vintage trucks were the hottest segment coming out of Scottsdale, with this 1948 Dodge Power Wagon selling for $99,000 at Barrett-Jackson. (Barrett-Jackson)

Amelia Island followed the trends set in Scottsdale, despite fewer cars offered and higher average sale price. Although 100 more vehicles were offered this year, total sales dropped from $140M in 2016 to $121.3M. The strongest segment was again cars valued at under $100,000; 55 percent of such vehicles inspected by Hagerty sold for more than their condition-specific HPG values. Porsche results were mixed. The front-engined four-cylinder cars at RM Sotheby’s sold at very high prices relative to their conditions. The 1969-73 911s did similarly well. The 1990s 911s didn’t fare as well, though, with 70 percent of 964s and 993s that Hagerty inspected brought prices below their condition-specific HPG values. BMW sales were also strong, with a like-new 1987 BMW M6 at $104,500 and a 1994 M3 Lightweight at $145,750 being the most notable results. Another surprising sale in the sub-$100,000 segment was a Meyers Manx at RM Sotheby’s. At $68,750, it was significant money for a VW-based kit car.

One sign of the exuberance in the sub-$100,000 market in Amelia this year was this 1963 Meyers Manx that sold for $68,750. (RM Sotheby’s)

Looking at the bigger picture, total sales between these three events are down by 3 percent and the average price is down nearly 12 percent despite a 10 percent increase in the number of vehicles sold. Strength among entry-level vehicles looks like it will be able to somewhat offset the relative softening at the very top of the market for seven- and eight-figure cars, although they still make up a disproportionate amount of the total value in the market. Interestingly, looking at these first three big auction events of the year, the number of million-dollar sales is at an all-time high despite a drop in the number offered, suggesting that sellers may be more willing to let their cars go rather than holding out at the highest possible reserve.

The proportion of the value of million-dollar cars sold relative to the rest of the auction market is at its lowest since 2013.

As for the remainder of the year, the strength at the lower end of the market, which includes a greater number of vehicles coming to auction, may actually result in an increase of overall sales totals over 2016 if current trends persist, particularly at the upcoming spring auctions. A slight but noticeable decrease in sales over $1M in 2017 is likely. Average sale price will consequently decrease as well, but if more cars keep selling at auction over the course of the year at the sub-$1M level, the grand total at the end of the year may actually see a slight bump. Last year, the total sales at North American collector car auctions amounted to $1.31B. With the current market dynamics, the number for 2017 is on track to be close to that number or slightly higher.