In a year that has faced unprecedented turbulence, Hagerty experts investigated how the market for classic cars responded. Buyers and sellers had to adapt the way they buy or sell classic cars, while auction companies, whether operating in the physical environment or online, had to dramatically rethink the way they do business.
The UK’s auction houses faced the greatest number of challenges brought on by Covid-19. Through the course of 2020, Hagerty’s Valuation Team tracked 4666 cars in 53 classic car auctions from 14 different auction houses. Their combined sales were more than £144.6 million ($193m). At the start of the year a sell-through rate of 70 to 75 per cent was considered a good result for a classic car auction, but as Britain’s lockdown started in March, auctions were hit hard.
In April, sell-through rates plummeted to as low as 19 per cent, and even online interest in cars fell: Auto Trader UK, the country’s largest digital car sales platform, reported a 30 per cent year-on-year drop in web traffic.
By May, auction companies with a strong online presence tended to do best, as did those that adapted quickly to government regulations. Silverstone Auctions achieved an extremely strong £4.53m ($5.52m) of sales at 86 per cent sell-through on 23rd May, achieving a mean winning bid of £61,148 ($74,466), over double that of the next-best auction.
This was the start of a summer boom: as the lockdown eased, a sense of optimism fueled Britain’s classic car market. People had become used to the Covid-19 restrictions and went back to the business of buying and selling cars. The number of auctions increased, too. Auction companies realising they had to sell or go out of business.
The smallest auction of the year arguably made the biggest impact of the year. Gooding & Company’s Passion of a Lifetime event at Hampton Court Palace, in September offered just 15 cars for sale. The auction smashed all records including the top sale value of the year – a 1934 Bugatti Type 59, which went for £9.35m – highest total sale (£34m) and highest average sale figures (£2.3m).
The announcement of a four-week lockdown in England during October had an almost unnoticeable effect on the auction market. In early November, Anglia Car Auctions achieved an impressive 89 per cent sell-through rate of 226 cars – typical for the time of year. The mean sell-through rate of all auctions Hagerty tracked in November was 73 per cent.
The story of 2020 was the dominance of online sales. From May, Hagerty started tracking web-only newcomers Collecting Cars and The Market. In that month, The Market achieved an 89 per cent sell-through and a near £18,000 ($21,920) mean winning bid.
When sales at classic car auctions were analysed by era, newer cars tended to be in favour. The 1990s provided the most auction entries at 809 cars offered, and cars from 2010-2020 were the most successfully sold with 86 per cent of cars offered from the last decade finding a buyer. 1940s cars were the least well-represented (55 cars offered) and pre-war cars had the lowest sale rate (65 per cent).
Trends may suggest that the market is embracing more modern cars, but the inclusion of the new wave of online-only sales platforms, which tend to sell more modern cars than the traditional auction houses, may have affected our findings. Next year will reveal whether this is a trend or just an anomaly.
The top-earning cars by country presents an interesting pattern. All of the cars – with the exception of a Lamborghini Miura – are racing or racing-derived cars. Even the Miura was a very special version, upgraded to various Jota specs, including a dry sump and limited-slip differential. It’s a trend Hagerty will continue to monitor.
Overall, it was an unexpectedly strong year for classic car auctions, with every auction house – from the biggest international company to the smallest regional business – having to embrace digital media and radically change the way they operate.
Speaking about the report John Mayhead, Head of UK Valuations, said
“2020 has been an extraordinary year for the UK classic car auction market. We’ve experienced the lows of the first lockdown that led to many sales being cancelled, to the high of Gooding & Company’s first European auction that smashed a raft of records. One theme that has emerged is the resilience of the auction houses, all of which have had to cope with huge changes to their procedures. Overall, though, it shows that enthusiasts are just that, and little will stand in the way of people who just want to buy & sell cars.”John Mayhead, Head of UK Valuations
Next year Hagerty will bring the car community more market analysis than ever, monitoring more than double the number of UK sales compared to 2020. Global valuation analysis will also be expanded. Hagerty aims to provide car enthusiasts and collectors with the best possible picture of the market, help identify trends and ultimately make sure that they are fully informed.