Bloomberg News

Ferraris Beaten by Ford Broncos, Jeep in Car Auctions

April 30, 2013

Classic 1966 Ford Bronco

A 1966 Ford Bronco with trailer. Auction values of these vintage SUVs have increased 61 percent since 2008, reflecting the growing popularity of 1960s and '70s sports utility vehicles in the classic car market. Source: Hagerty's Price Guide via Bloomberg

Vintage sports utility vehicles, SUVs, have become the latest growth area of the classic-car market.

As “blue chip” marques such as Ferrari (FERI) and Aston Martin become more expensive, a new generation of buyers looks to underrated, affordable autos.

This niche field of collecting has grown 65 percent since 2008, according to a report by the Michigan-based Hagerty Price Guide. The rate of increase is almost twice the 37 percent growth seen in the classic-car market as a whole during the same period, Hagerty said.

“If a truck is what you drive, buying a vintage one makes sense,” McKeel Hagerty, president and chief executive of Hagerty, said in an interview. “They’re cool, parts are readily available: It’s an inexpensive way to play in the car market.”

Classic cars, with their limited supply of investment-grade models, are proving to be one of the most resilient collecting markets. Auctions held by Gooding, RM, Barrett-Jackson, Bonhams and Russo & Steel in Arizona in January generated $223.8 million with fees, $39.9 million higher than last year.

The value of 1960s and 1970s Ford Broncos increased 61 percent to $25,250 in 2012 from $15,700 in 2008, said Hagerty. Prices of Toyota FJ Land Cruisers rose 35 percent over the same period; Jeeps were up 21 percent.

“Broncos are attractive and their convertible models have a warm-weather appeal,” Hagerty said. “Also, their engines have a bit more pep than Jeep.”

Blue Chip

According to Hagerty’s database, based on sales from more than 15 auction houses, the value of vintage SUVs has risen 31 percent in the last five years. The analysts’ “Blue Chip” index of the best collectible cars is at an all-time high of 240.9.

Hagerty’s “Rossa Corsa” Index of collectable Ferraris is also at an all-time high of 324.4 points after a 24 percent increase over the last 12 months.

Back in the mainstream classic market, RM Auctions Inc. raised more than $21.2 million with fees from its sale of 64 vehicles owned by the Texas-based collector Don Davis on April 27.

The most expensive of the cars accumulated by the founder of the Don Davis Auto Group was a dark blue 1967 Ferrari 330 GTS convertible. One of only 99 built, it underlined the demand for the Italian marque’s 1960s and 1970s road cars by selling for $1.9 million, an auction record for this particular model.

A “Best of Show” title from the Concorso Italiano at Monterey in California in 2011 helped push the bidding beyond the estimate of $1.2 to $1.5 million at hammer prices.

Other highlights from the Davis Collection included a 1973 Ferrari 365 GTB/4 Daytona Spider at $1.65 million and a 1955 Mercedes-Benz 300SL “Gullwing” at $1.2 million.

Blue Diamond

A blue diamond weighing 5.30 carats sold for 6.2 million pounds ($9.6 million), more than five times its lower estimate, at a jewelry auction in London on April 24.

The fancy deep-blue diamond, valued by Bonhams at 1 million pounds to 1.5 million pounds, was bought on the telephone by the London-based jeweler Graff Diamonds (1306).

The price of $1.8 million per carat was an auction record for a blue diamond, said the auction house, which had 25 telephone bidders registered for the lot.

Colored stones are prized for their decorative appeal and rarity. Naturally pigmented examples account for about 0.01 percent of mined diamonds, making them capable of setting one-off auction prices if large and of pure color.

Bulgari Ring

Bonhams’s cushion-cut stone was graded “fancy deep,” the highest intensity of color. It was set horizontally within a mount pave-set with brilliant-cut diamonds and courses of baguette-cut diamonds in a “Trombino” ring made by Bulgari in about 1965.

Graff is a frequent buyer of high-value colored stones at auction. The company paid 16.4 million pounds for the blue 35.56-carat “Wittelsbach Diamond” at Christie’s International (CHRS) in December 2008.

It gave a further 45.4 million francs ($45.6 million) -- a record price for any gem at auction -- for a 24.78-carat emerald-cut “Fancy Intense Pink” at Sotheby’s (BID), Geneva, in November 2010.

(Scott Reyburn writes about the art market for Muse, the arts and culture section of Bloomberg News. Opinions expressed are his own.)

Muse highlights include Hephzibah Anderson on books and Amanda Gordon’s Scene Last Night.

To contact the writer on the story: Scott Reyburn in London at sreyburn@hotmail.com.

To contact the editor responsible for this story: Manuela Hoelterhoff at mhoelterhoff@bloomberg.net.


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