What are “Breakout Sales” and why do they matter?
Breakout sales are auction results that act as a re-set button for a particular market. They announce that a certain car has officially hit the radar. A breakout sale might not make the market per se (single sales rarely do), but they do focus attention on specific cars. They also ensure that similar cars come to market testing buyers’ willingness to step up to what might be a new price point. A sustained uptick in interest and price is the key marker of a breakout sale. Anomalous results that do none of the above are just that, freak outliers, not breakout sales. On the eve of 2017’s Scottsdale auctions, we’ll consider a few notable North American breakout sales from years past, (plus some that weren’t) and highlight some possible breakout sales in Scottsdale this year:
1988 BMW M3 (Russo and Steele, Monterey 2012)- It’s tough to believe that this was four years ago, I remember having a spirited discussion with Dave Kinney about this silver/red E30 M3 with just 40,000 miles on the odo. We both agreed that the $20,000 or so that was customary for these cars seemed a bit light for this one. Neither of us pegged it at $40,000. We shook our heads and finally agreed that this car, even at that price, would look very well bought sooner rather than later. The sale signaled the official end of cheap E30 M3s.
1999 Acura NSX Zanardi Edition (Russo and Steele, Monterey 2012)- Drew Alcazar and his team at Russo and Steele do a fine job of stocking interesting cars with breakout potential and 2012 in Monterey was a particularly good year for them. This NSX was one of 50 named for racer and NSX-developer Alex Zanardi. A number of us had been predicting the rise of the NSX for a while and we latched onto this car as proof of the theory. At almost $65,000 it didn’t disappoint. This was at a time when the going rate for clean (albeit non-Zanardi) NSXs was still mid to high-twenties. Sales like this coupled with Honda’s reintroduction of the NSX effectively reset the market for these Japanese supercars. Gooding has a first year NSX in Scottsdale this year with under 8,000 miles. Will it break $100,000? It just might.
1986 Ferrari 328 GTS (RM Auctions, Monterey 2014)- Ferrari 308s and 328s seemed like they’d be cheap forever. Even super low-mileage cars struggled to break $50,000—until this sale that is. Overnight, dealers seemed to re-price everything, some more aggressively than others. It prompted me to get off my can and try to snag one of the last ones at the old price, (which I did). Early fiberglass 308s reached $300,000 by the next year and even steel, carbureted cars could do half that. They’ve backed off since, but the new price floor will never return to what it was.
1972 Alfa Romeo 2000 GTV (Gooding and Company, Pebble Beach 2011)- Alfa GTVs are pleasant, pretty, Giugiaro-designed grand tourers. Few dislike them and they remained an affordable option for those priced out of the Ferrari 330 GTC market. None of us were expecting anything unusual out of this lot at Gooding back in still-sleepy, post-recession 2011. Anyone who commented on it pre-sale, found the $25,000-$35,000 pre-sale estimate to be ambitious for a ‘70s Alfa coupe, especially one that was blue rather than red. The final sale price was $40,000 to a Palm Springs collector who used the car and sung its praises loudly. In less than a year, $40,000 was the new $25,000 for 1750 and 2000 GTVs.
Two that weren’t…
1983 Lotus Esprit Turbo (Bonhams, Scottsdale 2015)- We pegged this one as a potential breakout sale last year. https://www.hagerty.com/articles-videos/articles/2016/01/21/cars-to-watch-in-scottsdale Turbo Esprits are great cars with James Bond cachet that just haven’t seen enough interest in the market. This beautiful silver/red example was consigned by one of Bonhams car specialists and a very smart and savvy East Coast dealer bought it for what seemed a retail plus figure of $48,000. Sadly, no sustained interest in Esprit Turbos was realized. They remain undervalued and after advertising it in the high sixties for a year, the dealer has brought it back to Scottsdale again, this time with RM. Maybe this will be the year of the Esprit Turbo. Or not.
1963 Triumph TR4 (Barrett-Jackson Palm Beach, 2006)- Smack in the middle of the pre-Great Recession collector car market appreciation explosion, this car shocked every British sports car owner when it sold for $99,000. The car’s quality was off the charts and Austin-Healey 3000s had started to fetch six figures, so there was a fair amount of chatter that Triumphs would be the next big thing. This sale turned out to be a classic freak. No TR4 sold at auction has ever come close to this figure again. The bidders’ bar was rumored to have figured into this sale as two determined bidders fought it to the threshold of six figures. Today, nice TR4s remain sub-$30,000 cars as the pool of boomers who care about them dwindles. http://www.barrett-jackson.com/Events/Event/Details/1963-TRIUMPH-TR-4-ROADSTER-39923
…And five from Scottsdale 2017 that could be Breakout Sales
After several years of malaise in Scottsdale, this could be the year when the market shows some renewed vigor. Here are five cars that we think have breakout sale potential:
1971 DeTomaso Pantera (Gooding)- Panteras have always been like Sunbeam Tigers were until recently. Great sports cars that are easy to live with by virtue of bullet-proof Ford V-8 power. And although they’ve gone up in price over the last few years, they still strike us as too cheap for what they are. Some blame the fact that official build records are hard to come by, thus it’s tough to say exactly how rare Panteras really are. Regardless, they haven’t come up for sale at the prestigious catalog sales very often. This is one of the first prime-time Panteras to show up in recent years. It looks thoroughly the part in its well-resprayed original period lime green color, an original interior and only 27,000 miles. It’s being sold with no reserve and a pre-sale estimate of $130,000-$160,000. A sale at the high end or more could re-set the Pantera market permanently.
1975 Lancia Stratos HF Stradale (Gooding)- The Stratos is one of the most insanely cool supercars of the 1970s. It’s also probably the least known. Only 492 were built in an effort to homologate the car for sports car racing and rallying where the Stratos actually did quite well. Powered by a Ferrari Dino V-6, the Stratos was hands down, the prettiest expression of the wedge theme that flourished in the 1970s. The pre-sale estimate is $500,000-$600,000. The Stratos is one car that begs to join the million dollar club.
1973 Citröen SM (Gooding)- The SM was an expensive GT engineered by the French and powered by an Italian Maserati V-6. What could go wrong? As it turns out, not all that much with proper maintenance, which sadly, in this country is hard to find. Still, these are brilliant GT cars, with otherworldly looks and a suspension system that’s more advanced than anything you can buy today. Many pegged it as the best car in the world at the time. They’re consistently underappreciated and rarely appear at major auctions. This might just be the car that changes all of that if it rockets past its $100,000 high estimate.
1989 Nissan Skyline GT-R (RM)- R32 Skyline GT-Rs have only become legal in the US in the last few years. Prior to that, they were legend—unobtainium, forbidden fruit. This is among the first of the crop to show up at a major auction, and it looks to be a particularly nice example, showing just around 16,000 original miles. It’s reserved rather conservatively at just $50,000-$70,000. If it breaks $100,000 everyone will be talking and they’ll be showing up by the container load in Long Beach, Calif., within two months.
2003 Ferrari 360 Modena Spider (Russo and Steele)- The 360 Modena was itself a breakout car for Ferrari. A clean slate design after the 348-derived F355, most 360s came with the automatic, single-clutch F1 gearbox. Just under 650 Spiders were delivered with an honest-to-goodness, six-speed manual gearbox with Ferrari’s famous gated shifter. This one is stunning in metallic gray (red is emphatically not the best color for the 360) with recent service. Late model, manual trans Ferraris have been hot lately. This is the car that might propel the 360 to the next level.