Arizona Auction Week: An Uncertain Market
It will be an interesting kickoff to the auction season in Scottsdale this week with a heightened sense of uncertainly during a partial government shutdown and the overall financial market volatility. Brexit and macroecomomic uncertainty have taken the European buyer out of the global collector car market, by and large. I suspect that there will be a lack of European would-be buyers in sunny Scottsdale again this year and this could be an important factor with results. Adversely, there is no extraordinary Porsche for sale in Scottsdale from any of the auction houses to create any excitement among the Stuttgart faithful.
Hagerty Insurance recently published an article that pointed out the leveling off of the Porsche market. By crunching 2018 auction results and data, they determined an eight percent drop in Porsche sale rate compared to 2017. Now anyone paying attention to qualified pundits would know that the overall Porsche market has been leveling off since 2014. The market correction has particularly hit some of the air-cooled models, such as the pedestrian long hood 911’s and the 930 market, for example. This represents the formal process of growing pains and the Porsche journey to arrive at the blue-chip table. As a result, there is a more acute awareness of what truly qualifies as rare and collectible. Not every air-cooled Porsche represents an excellent opportunity to diversify into a different asset class as proclaimed in mainstream media over the years. Some cars are meant to be driven for enjoyment purposes and that’s perfectly ok. There doesn’t always need to be an upside, but that is a topic for a whole different time.
If anything, 2018 underlined that the best-in-class cars continue to transcend market expectation and sell well. Whether a significant race car, a documented concours restoration example, or documented originals with provenance, there continues to be strong market demand for high level cars.
There will be two key Porsche market segments to watch in my opinion during Scottsdale auction week. There are no less than seven examples of the iconic 356 Speedster going up for sale between the three boutique auction houses (RM Sotheby’s, Gooding & Company, and Bonham’s & Butterfields). The 356 Speedster has always weathered market trends due to its acknowledged icon status even though Porsche produced over 4,000 of them. The Speedster lots available at Scottsdale cover the spectrum from driver to concours level with differing degrees of provenance. The low estimate for a non-matching driver example being 250K and 550K representing the high estimate for a concours example. After the smoke clears we should have a pretty good understanding of what the market will bear in direct correlation to condition.
Lastly, I will be extremely interested in the modern-day classics that will be available: the 997 911 Speedster, 997 911 Sport Classic, and 991 911R. The Speedster is a low mileage PTS example and there are a few guys out there who want a special example of the 997 Speedster to complete their Speedster collection. The 997 Sport Classic is one of the best 911’s ever made and lives up to its moniker. They rarely if ever come up for auction in the United States. Lastly, there is a significant different between the 911R and GT3 Touring. Anyone who spouts off that they are the same simply hasn’t spent much seat time in both. “It’s all about the calibration.” I have driven both and agree with the sentiments expressed on Spike Feresten’s podcast between Jerry Seinfeld, Paul Zuckerman, and Spike. The 911R is pure driving brilliance personified through the seat of your pants and grin of shifting gears. The 911R’s have been dropping to very appealing prices indeed!