Auction sales during Monterey Car Week saw a 3% decrease from the previous year, indicating a shift in preference from older classic cars to newer models. The total sales at this year’s five car auctioneers in Monterey dropped to $391.6 million, down from $403 million in 2023. This decline follows a 14% decrease from the peak year of 2022. The decrease in sales can be attributed to the oversaturation of classic cars from the 1950s and 1960s. With only 821 out of 1,143 cars being sold, it is clear that the market for older classic cars is dwindling.
While wealthy collectors still have the financial means to make significant purchases, there has been a noticeable trend among younger collectors. Gen Xers and millennials are now the driving force behind the classic car market, showing a preference for cars from the 1980s, 1990s, and 2000s. This shift in preference has led to a sell-through rate of 73% for newer cars compared to a mere 52% for pre-1981 cars priced at $1 million or more. The Hagerty Supercar Index, which tracks sports cars from the 1980s to the 2000s, has shown a significant increase, while the Blue Chip Index for 1950s and 1960s classics has declined by 3%.
The oversaturation of similar classic cars at multiple auctions has led to weaker prices and sales. This oversupply has resulted in a lack of interest from buyers, especially for older models popular with baby boomers. The high sell-through rate for newer cars indicates a clear shift in the market, with young collectors dictating the trends. While a few rare masterpieces still command high prices, the overall trend is towards modern supercars rather than vintage classics.
Financial Considerations
In addition to changing preferences, high-interest rates have also played a role in impacting the classic car market. The availability of financing at the lower end of the market has allowed buyers to build their collections, but rising interest rates have increased the opportunity cost of investing in classic cars. Potential buyers are now weighing their options, considering the potential returns from other investments rather than tying up their funds in classic cars. This shift in mindset is likely to affect the prices of older classic cars for the foreseeable future.
The classic car auction sales landscape is evolving, with a clear preference for newer models among younger collectors. The oversaturation of older classic cars, combined with changing demographics and financial considerations, has led to a decline in sales and prices for vintage classics. As the market continues to adapt to these changes, it will be interesting to see how auction houses and collectors navigate the shifting dynamics of the classic car market.
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