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(Bloomberg) — Bring a Trailer sold $829 million worth of cars last year, more than any other auction house in the world.

The feat marked a shift in the collector vehicle market after a year defined by coronavirus restrictions, pent-up demand and economic tailwinds. While auction houses such as Barrett-Jackson, Bonhams, Gooding & Co., Mecum and RM Sotheby’s had long captured most of the collector car market, the emergence and mastery of auctions in online companies such as BAT, CollectingCars and Shiftgate have massively increased the number of cars sold online, in many cases siphoning off cars that would have been offered at live auctions in favor of being sold on the web, and set many record online sales throughout.

“The market is much bigger than we currently think,” Maarten ten Holder, managing director of Bonhams Motoring, told a group of collectors, industry insiders and journalists who had gathered for a round table on the state of car collection. at the Petersen Automotive Museum on January 15 in Los Angeles. “Online is extremely important.”

Eyes are now on Scottsdale, Ariz., where the annual Desert Auction Week, Jan. 22-30, is set to demonstrate just how lunch auction houses have been eaten by online upstarts.

“I’m just more than curious about the results,” says Matthew Katz, a prominent Los Angeles collector who counts a Maserati MC12, Mercedes-Benz 300SL and Ferrari F40 among his prizes. “The prices are beyond stupid.” For his part, Katz will not attend the Scottsdale auction, even though he has participated in many auctions in the past. The geographic fluidity of the online auction system means that collectors like Katz can satisfy their perpetual desire to find a new toy without having to travel or wait for in-person events.

Deals in the desert

RM Sothebys, Bonhams and Barrett-Jackson will hold live auctions under tents in Scottsdale, as in previous years, but the number of lots and auction days are reduced from previous years. Of the three, only Barrett-Jackson will hold live auctions over multiple days. For its part, Gooding & Co. will organize a sale entitled “Geared Online Scottsdale Edition”, which will be exclusively online, without physical presence. This will be his only sale during the week.

The mixed approach reflects the sustained effort of auction houses to adapt to the times.

“Our business has certainly changed a lot over the past five, six years or so with the advent of online auctions and more recently with the pandemic,” says Jakob Greisen, vice president and head of the US automotive department at Bonhams. “We had to regroup and change our format a bit, but we’re back with a traditional live format, and I think there’s room for that alongside online auctions.”

This year in Scottsdale, Bonhams will have hand sanitizer on-site, Greisen says, and has created more video and digital resources to increase cars for sale, such as history file scans, tour videos and Facetime consultations with specialists, “so that bidders can also feel comfortable bidding from home” by phone or online.

Phillip Toledano, who has gained a large following online for his obsession with owning automotive oddities like the Maserati Shamal and Lancia Delta S4, will not be attending any events in Scottsdale, although he is actively looking to buy something new . He doesn’t see the need to go there.

“I trust online sales a lot more [than live auctions]says Toledano. “When the hordes weigh in the online comment section, you get a much more accurate idea of ​​a car, compared to just seeing it rolling over an auction block.”

Look closely, from afar

Elsewhere, Peter Brotman and Steven Serio, two longtime car buying and selling tycoons, are also passing through Arizona for the first time in decades. They will enjoy an invite-only drive for classic car heavy hitters in North Carolina.

“Arizona is changing,” Serio says. “European car buyers and high-end guys who liked to go there are like, ‘Meh,'” he explains, referring to a general lack of excitement. an auction tent.”

“It’s more, better fun [in North Carolina]Brotman says.

Which isn’t to say that they and others like them won’t trail Scottsdale sales far behind. Live auctions are always an important place to highlight cars that belonged to the liquidators of a collection, such as the Tenenbaum collection that RM Sotheby’s is selling this year in Arizona.

“RM and Gooding are needed to help sell large collections, whether privately or through special sales,” says Serio, as they have the extensive resources, human and otherwise, needed to screen, process, transport and market a large number of important vehicles. . “They’re doing it very well, and that’s not going to change.”

The Tenenbaum collection includes items such as a 1994 Porsche 911 Turbo S “Flachbau” with a high estimate of $1.1 million and a 1987 Porsche 959 with a high estimate of $1.5 million; RM Sotheby’s will also sell a 1967 Lamborghini 400 GT 2+2 by Touring in bright rare blue (high estimate $550,000) and a 1955 Mercedes-Benz 300 SL Gullwing (high estimate, $1.65 million) among its wares. .

Notable cars to look out for at the Bonhams sale include an extremely rare 1902 Darracq two-seater Voiturette with 9 hp (high estimate: $65,000) and, at the other end of the power spectrum, a 1997 Porsche 911 with 424 hp and a high estimate of $320,000. (The latter, a “993,” Turbo S, argues that not all salable Porsches have gone to Bring a Trailer or Porsche’s proprietary online sales platform…yet.)

A 1949 Buick Roadmaster Convertible will be featured at Bonhams sale on January 27. It appeared in the film Rain Man with Dustin Hoffman and Tom Cruise and is offered directly from the property of Hoffman, who acquired the car after filming was completed. . It has an estimate of $150,000 to $250,000.

Still, look for cars as big as the 2004 Porsche Carrera GT, to be sold by Barrett-Jackson, and the 2005 Porsche Carrera GT to be sold by RM Sotheby’s – both offered without reserve – to really indicate the strength of the market for live auctions. Earlier this month, two ultra-low-mileage Carrera GTs set subsequent high-selling records of $1.9 million and then $2 million online.

“It will be interesting to see how many cars over $1 million end up with BaT next year,” Serio says. “It will be the barometer.” In 2021, nine of the nearly 16,000 vehicles sold on BAT sold at over seven figures; in 2020, only two have done so. In 2019, it was one.

One-stop shops

Meanwhile, auction house executives are snapping up more market share with a multi-pronged approach. They strive to prove to collectors how essential their deep institutional expertise and customer relationships built over decades are, unlike more anonymous web companies that sell cars as if they were low-end commodities. range.

“What we bring is a company that has been around for around 250 years, with specialists who know the market,” says ten Holder.

They also emphasize the ease and utility of their full-service, white-glove approach, with its extreme attention to detail, provenance, racing history and colors, mechanics and components. of time. It’s an attractive scenario for sellers who don’t have or can’t afford the time to provide detailed photographs, history, and transportation logistics for a given vehicle.

“With just a signature [from the consigner], we do the research, we do the photography, we ship the car, we detail it, we do everything,” says Greisen. “It’s more of a one-stop shop.”

These services must come with a fee that traditionally represents a 20% profit for the auction house, split between buyer and seller. Those who sell online must provide much of it themselves, down to the photograph, or pay higher listing fees. To list a car on Bring a Trailer costs $99; buyers’ fees are capped at $5,000, regardless of the sale price of the vehicle.

It’s also true that live auctions are fun. Online auctions lack the raw energy and spectacle of any top-notch live auction, which includes swirls of champagne, bright lights, ladies in cocktail dresses or furs and a curator- energetic auctioneer who whips the crowd into a frenzy. That’s why annual sales in such prestigious locations as Carmel, California, Amelia Island, Florida, and Lake Como, Italy, retain such appeal for many collectors, says Brian Rabold, vice president of automotive intelligence at Hagerty. For these annual live sales, it’s a see-and-be-seen scene.

“Major live auctions benefit from the atmosphere of competitions such as Amelia Island and Pebble Beach, and that environment is difficult to replicate online,” says Rabold.

Randy Nonnenberg, the co-founder of Bring a Trailer, agrees. “I think the big auctions will always have activity,” he says. “They put on a great show.”

But even the oldest auction houses admit they have to work to keep up with the times. RM Sotheby’s, Gooding, Bonhams and Barrett-Jackson, among others, have all used web-only sales to augment – and in the darker days of Covid-19, temporarily replace – live sales. On January 15, Bonhams launched an online part of the business called Bonhams Market. “Online gives us an additional tool, an additional portal,” says ten Holder.

Bruce Meyer, a Southern California automotive figure known for owning racing Ferraris, rare hotrods and early Porsches — and owning much of the real estate on Rodeo Drive — remains optimistic about the emergence of online sales, calling them good for the industry as a whole.

“A lot of companies are getting into online sales, as they should be,” Meyer said during the panel at the Peterson Museum. In 2019, he bought a 1935 Bugatti Type 57 online. At 80, he’s old enough to have a long-term view of the new shape of the collector scene.

“Is this the new normal? It appears to be the case,” he said. “Ultimately, honest representation will win the business.”

©2022 Bloomberg LP

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