Scottsdale Reality Check


The U.S. Internal Revenue Service defines a hobby as “an activity not engaged in for profit.” The 2015 Scottsdale auction results suggest that hobbyists may be an emerging trend. And if these results have a theme, that might be reality check.

To long-time auction observers, something seemed different immediately. No one heard Russian in Scottsdale. French, German, and other European languages were uncommon and that was unusual. The Swiss National Bank (SNB) action may have scared some international bidders off their cellphones. Others probably celebrated their foresight for not booking travel to Arizona at all.


In 2011 the Swiss bank had fixed its franc-to-euro exchange rate in a Recession-era effort to stabilize and strengthen its currency. On January 15—the day of Bonhams’, the eve of Gooding’s, the middle of Barrett-Jackson’s sale, and days before the start of RM’s—SNB cast their franc afloat. As The Economist reported, “There was panic. The franc soared. On Wednesday [the 15th] one euro was worth 1.2 Swiss francs; at one point on Thursday its value had fallen to just 0.85 francs. A number of hedge funds across the world made big losses. The Swiss stockmarket collapsed.”

Investors considered the Swiss franc a “safe-haven” as The Economist put it, like “American government bonds: buy them and you know your money will not be at risk….” That sounds like the confidence that compelled savvy collectors a decade ago to seek out low production-number Ferrari, Alfa Romeo, Porsche, or Mercedes-Benz road-going and racecars and certain other automotive treasures with verifiable and consequential history.

The Franc Afloat


“But as investors flocked to the franc, they dramatically pushed up its value,” The Economist writer continued. Couple that with wide expectations that the European Central Bank (ECB) likely will initiate “quantitative easing”. This is a euphemism for creating new money to purchase the debt of struggling euro-zone countries. Economists – the magazine and otherwise – expect this action will decrease the value of the euro beyond the 12% readjustment it already has experienced against the dollar.

This exerts strong influence on those who acquire multi-million dollar (or euro) automobiles at auction. And if that were not reason enough that bidding for high-end vehicles did not meet their reserves, another reality has set in: serious collectors already have what they want. Those who bought this past January improved their collections. Or they missed the party when early invitations went out.

Precious Metal Exchange

Clearly some precious metal (or fiberglass) changed hands at Scottsdale. Barrett-Jackson sold highly-anticipated vehicles from Ron Pratte’s collection including the 1954 Pontiac Motorama Concept car for $3.3 million (all prices quoted include fees); the 1966 Shelby Cobra Super Snake for $5,115,000; the 1950 GM Futureliner Parade of Progress Tour Bus for $4 million; and a humble 1949 MG-TC Roadster in which Carroll Shelby started his racing career, for $539,000. They sold a 1937 Mercedes-Benz 320B cabriolet for $1,045,000, and a 1965 Cobra competition 427 roadster with verified history and a recent full restoration for $1,595.000.


At RM Auctions, their 1964 Ferrari 250LM with fascinating history made an admirable $9,625,000; a 1967 275GTB/4 went for $3,675,500; a 1973 365GTB/4 Daytona Spider made $3.3M, a 1984 288GTO sold for $2,75M; a 1962 250 GT Pininfarina Cabriolet Series II brought $1,705,000; and a 1990 F40 sold for $1,265,000. RM’s 1965 Porsche 904 Carrera GTS collected $1,650,000; and a 1988 Porsche 959 Komfort model sold at $1,045,000.

David Gooding achieved success with a 1959 Ferrari 250 GT long wheelbase California Spider gaveling down at $7.7M including fees (against estimates of $8-10M); a 1962 400 Superamerica Series I Aerodinamico Coupe sold at $4,070,000 (with estimates from $4 to $5M); a 1966 Porsche 906 Carrera 6 with Le Mans class success crossed the block for $1.98M (estimated at $2-2.4M); and chasing that, a 1988 Porsche 959 Sport model sold at $1,705,000 (right within its $1.5-$2.0 range.)

Bonhams opened the high-end car sales at 9am on the 15th and set a new class record with a 1966 Ferrari 275GTB Competizione that ran at Le Mans, selling for $9,405,000. They did well with a 1955 Mercedes-Benz 300SL coupe that once belonged to the Prime Minister of Northern Ireland. It went for $1,375M. A very original, well-preserved 300SL roadster on Rudge wheels sold for $1,237,500; and a 1964 Shelby 289 Cobra in a single family since new brought $1,017,500.


The other side of the story is that many – very many – of the high-end cars sold at prices that scarcely reached their low estimate. Worse, each of the houses suffered with cars at reserves whose hopeful owners didn’t budge. This was the situation with all houses and all marques, not only with Ferraris and Porsches (both 356 and 911 models.) As Kevin Watts observed, “last fall in Monterey, the Porsche market remained red hot because buyers were priced out of the tier above.” That market slipped another tier in Arizona.

Novelties Sold

It was odd, amusing, and unique cars that surprised observers. Buyers could not get enough of the beach-mobile Fiat 600 Jolly, a car first created for Greek shipbuilder Aristotle Onassis that was easy to hoist on and off his yacht. Nearly every house had one (or two) that reached $75,000 to $170,000 against predictions of $50-to-100 thousand. A Toyota FJ40 Land Cruiser – spectacularly over-restored – went for $98,000 at RM. Gooding sold one at $60,500, (though it fell short of its low estimate.) Every house had an FJ: Barrett-Jackson shrewdly offered and sold 15, the best a 1968 FJ45 pickup at $55,000.

At Gooding, a 1973 Porsche 911 S brought $187,000; another commanded $145,750; a 1972 S Targa collected $132,000; a ’66 911 sold for $170,500; Their 1967 S went for $253,000, slightly below its $275-$325,000 estimate. Their 1963 356 Carrera 2 coupe went for $643,500, bumping into its upper estimate at $650,000. At RM, a 1973 S, estimated between $250,000 and $300,000 did not sell.


“Great cars with correct provenance,” Watts continued, “priced less than $300,000 to $400,000 rung the bidders’ bells this time. Unfortunately there just weren’t any Porsches like that. Porsche 911 S models seemed to slip to 2010 prices. The smart collectors spent shrewdly,” he added, “they paid correct money for average cars. Educated buyers showed up in Scottsdale. This year was a Renaissance Faire with no jousting. There were very few pissing matches between bidders.”

At week’s end, stereotypes were reinforced: Gooding, Bonhams, and RM catered to clients who perceive automobiles as an art investment. Many just didn’t care for the artists or the price tags. Barrett-Jackson, and Russo and Steele treated clients – often recognizing they have fewer days ahead of them than behind them – as enthusiasts looking for the next fun thing. That dictated prices and skewed perceived values. Scottsdale demonstrated that with every sale or every pass.

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