Market for classic cars stabilises after post-Covid-19 surge

Hagerty Price Guide UK editor John Mayhead has identified trends suggesting the classic car market may have reached a plateau after years of volatility.

After the Covid-19 pandemic, the classic car market saw a surge in demand as buyers pursued long-desired vehicles. Hagerty’s six UK indices, each tracking a different sector, recorded a rise in values as supply fell short and sellers increased prices, which buyers were initially willing to meet.

However, as life returned to normal and many potential buyers reassessed their priorities, economic pressures began to take hold. Rising interest rates, increased living costs and uncertainties surrounding elections in the UK and US led many to exercise caution with their finances. Additionally, some post-pandemic classic car buyers decided to sell, having fulfilled their desire to own such vehicles.

By mid-2023, Hagerty noticed a drop in sales and car values, with 40% of models in the UK Hagerty Price Guide experiencing a drop in value by September 1 2024. In the US, 35% of models saw a decline. Sales at the August 2024 Monterey auctions, a key indicator of the US market, were 9% below Hagerty’s most conservative forecast.

In the UK, data from the Bonhams Goodwood Revival auctions indicate sellers are now more likely to accept lower offers compared with 2023. Sale prices and high bids decreased and the number of cars consigned dropped by 15%, while the sell-through rate declined by 11%. This could indicate that buyers and sellers are approaching the market with increased caution.

Despite these trends, signs of market stabilisation appeared during 2023. By September 1, nearly 90% of values in the UK Hagerty Price Guide remained unchanged, with five of the six indices staying within one percentage point of neutral.

Also, sought-after models with good provenance continued to achieve unparalleled values, including a Mercedes-Benz 280 SL Pagoda which set a new SA classic-car auction record of R3.5m at the Creative Rides sale at Montecasino in September.

Internationally, a 1962 Ferrari 330 LM/250 GTO by Scaglietti set a new auction record for Ferraris when it was sold for $51.7m (R883m) at an RM Sotheby’s auction in New York in November 2023.