Scottsdale and Kissimmee kick off the collector car business every year and provide a very telling gauge as to what can be expected in the year to come. For Corvette enthusiasts, it would be hard to call the outlook ‘bleak,’ but it would be reasonable to call it ‘over saturated.’
As the tents in the Arizona dessert were pitched by Barrett-Jackson, Russo and Steele, RM and Gooding, a flood of Corvettes — between those and Mecum in Kissimmee, Florida — kept prices flat and down despite positive sales volume. Clearly the ‘Great American Sportscar’ has not kept pace with its European counterparts as the collector car world enthusiastically got off their hands and bought cars in a way that they did not in 2016. But that does not mean they are setting the world on fire.
In Scottsdale, the cars themselves were beautiful, great examples, well-represented. The election over, the economy seemingly headed back in the right direction and the stock market heading for record levels played a major role in the sell-through increases. In stark contrast to 2016, where the crowd on hand did not seem to have the same zeal. There was a tension in the air. Uncertainty. For many, including car collectors, 2016 seemed to be all that — a depressing year.
The cars at all levels were selling. But for the most part, aside from a special few, most were not or barely meeting low estimates. Generally at an auction, the car will have a window sticker that contains information about the car, the story, features and most importantly, the value that the seller and auctioneer have agreed to print. This is usually two numbers: a low and high estimate. Beating the high estimate is cause for celebration—particularly on very collectible cars in the millions of dollars. Not getting bids to the low estimate can mean one of two things: the car does not sell as it has not met a ‘reserve’ or the car will sell, but the estimate is either considered optimistic or complete BS.
The flood of Corvettes gave buyers way too many choices. There were many C1 through C7 examples, some with rarities and special stories, but overall the market was flat for the cars. Marshall Fancher, editor of Vette-N-Vestments, a Corvette Auction newsletter offered his reasoning: “I call it the ‘Mecum effect’. There are greater than 350 Corvettes being offered at the Kissimmee auction this year. That’s dramatic.”
Barrett Jackson had many. But only a handful graced the ‘Salon’ section, where the top investment-grade cars are displayed. Two of the three standouts, a 1964 took $330,000 and a 1963 Split window “Fuelie” brought $385,000. The other was the CERV-1 — undoubtedly the most interesting of the lot, call it a Corvette or not. The CERV-1 stands for “Chevrolet Engineering Research Vehicle – 1”. Zora Arkus-Duntov developed the vehicle between 1959 and 1960 to learn more about ride and handling. The car itself was unveiled at Riverside International Raceway in late 1960. Much was learned from this particular vehicle by Duntov and his group — and the car brought $1.32MM.
Early results from Arizona reveal that the collector car market is in what experts are calling a “correction.” While total sales rose 3.7% to $259.8 million versus last January, the $9.2 million jump could be attributed to the addition of newcomer Worldwide Auctioneers with $11.4 million in sales. In this particular auction, a 1954 Roadster fetched only $66,000, while a 1965 “Fuelie” fetched $112,000. The big seller was a very rare 1967 L88 Roadster that brought $1.98MM — which made up almost 20 percent of the auction house’ net sales.
Volume increased in cars sold (2,900 vs. 2,491 in 2016, up 16%) and total consignment lots (3,486, up 12% from 2016’s 3,104) with a higher 83% sell-through rate in 2017 against last year’s 80%. Nevertheless, the average sale price dropped a hefty 10.9% from 2016’s $100,588 per vehicle to $89,601 across the board. 586 cars went unsold. We remain in a bear market, despite the enthusiasm of the auction houses and willing buyers. Consider 2015’s record total over $290 million, and the average sale price in Arizona has dropped 22.5% in a two-year span.
Corvettes again sold well at Russo and Steele, but the prices they fetched remind buyers that these are not “rare Porsches and Ferraris.” While prices dropped across the board with the market adjustment, Corvettes seem to have flooded the marketplace, further depressing the net prices. The most expensive Corvette at Russo and Steele was a 1958 model at $103,400. Two 1963 machines — both with automatic transmissions sold at $89,100 and $92,400.
The mid ’70’s Corvettes were perhaps the biggest disappointments. Although documented ad nauseum over the years, this era of Corvette was underpowered and harnessed by EPA regulations and pollution control. It wouldn’t be until the late 1980’s when the Big 3 Three got a handle on power-to-regulations.
If you love Sharks though, these late era models are plentiful, cheap and easy to apply the restomod treatment without cutting up a rare, original car.
Moving forward as different auction houses head for the different cities, if you have a collectible Corvette, it may be a good time token an eye on Mecum, and “hold” with a “wait and see” attitude for the early to mid-year auction results.
On the other hand, of you’re in the market for a Corvette, it’s a buyer’s market. Happy hunting!