This summer, millions of dollars’ worth of cars will find their way to new homes via the world’s most prestigious auctions, in Pebble Beach, Calif.
Sales predictions this year are cautiously optimistic. Usually election years spark a lull in pricing because potential buyers are uncertain about the future, but great cars will always earn multimillion-dollar price tags, said Ian Kelleher, the car specialist for RM Sotheby’s.
So far this year, the major vintage car auctions have seen bigger dollar figures than in 2015. But the overall sell-through rate this year is down to 65 percent compared with 87 percent last year—in other words, fewer of the cars on offer have ended up getting sold.
So if you have an important vintage car you want to unload in 2016, what should you do?
Where to Begin
First of all, start early. The longer an auction house has to photograph, film, and otherwise market your car, the better. And if you want to sell your car through one of the world’s top auto auction houses (Gooding & Co., RM Sotheby’s, Bonhams, Russo & Steele), you should start now. Most are taking considerations for consignment for the Monterey auctions until the end of June.
“We are going to spend a lot of money marketing the car,” Kelleher said, noting that the Monterey auction costs the company more than $1 million to produce. Printing auction catalogues and promotional materials alone can cost more than $100,000. “Ultimately it’s about value-added services, so the longer we have to work with a car, the more we can do.”
But before you jump into a sale, consider a few things first. Does your car have the provenance and racing success that might make it appealing? High-end auction houses work hard to ensure that their sales—especially the most prestigious at Pebble Beach—have a lot of variety in the portfolio. Often they’ll take only one of a certain model.
“We try to consign a wide variety of cars—everything from $100,000 cars to $10 million cars and above,” said David Gooding, president of Gooding & Co. “We want different eras, all different types and marks. We try to [choose] the best we can find but also cars that are priced sensibly—because it’s not a car show, it’s an auction.”
Know Your Angles
Ask yourself these questions: Does your car have a story to tell? Does it have universal appeal? Was it owned by someone famous?
“Maybe it isn’t the greatest car in the world, but maybe it is a special example of that car,” Kelleher said. “Maybe it’s not just a run-of-the mill Porsche, it’s a Janice Joplin Porsche.”
The auction catalogue can help rationalize and explain that to potential buyers.
You must be willing to trust the auction company to market your car and sell it in the best way possible.
“We really have our own strong opinions about the value of the cars,” Gooding said. “Oftentimes the owners know a lot about the cars, so we are certainly open to hearing their input. But we turn many cars away that may be perfectly good cars, but the owner wants too much money for them, and we are just doing what we think we can to fulfill that obligation. We have to make a judgment call.”
How to Do It
Still game? Then find a good auction house and sell. Here’s how:
1. Figure out which auction house is right for you. Gooding & Co. is known for selling the blue-chip cars (think racing Ferraris, Bugattis, Jaguars). Bonhams is renowned for its ability to eke out high amounts for highly specialized, unique models. Russo & Steele is based primarily in Scottsdale, Ariz. RM Sotheby’s has headquarters in London. Mecum features mostly muscle cars. It pays to call around and, if you can, even meet the specialists at each house who will be working with your car. Once you find one you like, call or e-mail and ask to speak with a consignment representative. The earlier, the better.
“As I walk off the stage [from the previous year’s auction], people come up to me and start discussing cars to sell next year,” Gooding said. “So it’s a year-round process and a global process to build the auction catalogue.” A full 35 percent of the cars in the Gooding Monterey sale will be imported for the event.
2. Provide the paperwork for an extensive evaluation. That means sending in copies of ownership records, maintenance logs, information about any and all restorations and updates, lists of racing entries and wins, and any other paperwork pertaining to the car. Even seemingly minute details about your car’s history can help bolster its value.
“The quality of the car and its documentation and history and provenance are very important to us,” Gooding said.
3. Send photos. If your car is very good, the auction house will shoot it, too. But they’ll want to see what they’re working with. Every angle of the car’s front, side, doors, rear, trunk, engine, detailing, back seat, roofline and spoiler or fins helps the auction house understand your car better and consider it for placement in a sale. Once the house determines it likes your car, it will send out a representative to evaluate it in person.
4. Sign the seller’s agreement. Each one is slightly different, and each is confidential, but a good rule of thumb is that cars valued at less than $250,000 are offered without reserve and require a 10 percent seller’s commission, plus a $1,500 entry fee that covers marketing, such as photographer and printed materials. As you cross over the $300,000 mark, the commission tends to be negotiable depending on the car’s value and sale price. There is also generally a buyer’s premium associated with the sale that stands at 10 percent. That is a fixed commission that also goes to the auction house and is attached to the sale of the car. (The seller’s commission is an entirely separate commission that the auction company earns from both buyer and seller.)
5. Schedule transportation, which can run a couple of thousand dollars or more for international transport. Unless you have a $10 million Ferrari, you’ll pay the cost for getting the car to the auction site. If you do have that Ferrari, the auction house will often work out a deal on shipping. Again, the earlier you can get the car to the auction site, the better, because that allows the organizers to promote it to media and potential buyers.
6. Watch the sale: You never know when a certain car could ignite a bidding war.
“Yes, it’s an election year, but if someone sees something special, all bets are off,” Kelleher says. Keep your fingers crossed.
