Is the End Nigh?

As the Monterey Bay historic automobile “Holy Week” approaches, there are some interesting tea leaves to read on the auction front. We will discuss the cars going on the block during the week’s auctions shortly, but the big sale news is the pending deal to sell the entire Bonhams auction house.

The Mercedes W196 that Bonhams sold in 2013 set the record for the most expensive car ever sold at auction. It was driven by the legendary Juan Manuel Fangio to victories at the Swiss and Spanish Grands Prix. The car thus contributed points toward Fangio’s World Championship in 1954.

After problems with less than competitive buyers’ and sellers’ premiums and some customer service glitches, Bonhams engineered a brilliant turnaround and a year ago last month, realized the highest price ever for a car at auction. It was a Mercedes W196 Grand Prix car, s/n 00006. The price, including buyer’s premium, was US$ 33,557,787. At Monterey in 2013 they more than tripled their 2012 sales from US$ 9 million to 31 million. That was part of what allowed Bonhams to double its profits from the previous year to US$ 41.8 million. It would appear that they will be increasing their profit again this year.

Bonhams shareholders include two incredibly sophisticated collector car personalities, Robert Brooks and Evert Louwman. Brooks is a former racing driver who founded an auction house that was merged into Bonhams. Louwman is the former Dutch importer of Lexus, Toyota and Suzuki who has one of the world’s major automobile collections. It is displayed at the Louwman Museum in The Hague. Management began taking bids for Bonhams last month. Meanwhile a group of banks began assembling a debt package for the ultimate buyer of between $250 and 350 million based on estimates of Bonhams projected earnings.

RM will present this 250 LM s/n 6045. Originally owned by casino magnate and Ferrari distributor, Bill Harrah, he drove it 8000 miles on the street. It was never raced in period, but has had vintage outings since. The car has a complete Ferrari Classiche Red Book certification. It is seen driven by restorer Jeremy Cottingham in modern vintage racing.

One question that comes immediately to mind is why do the shareholders want to sell such a profitable business? Do they think the rapid advance of prices in the collector car market has created a bubble and now is the time to sell?

Despite the Bonhams Mercedes sale, Ferraris have usually headed the list of highest auction house sales. Bonhams will have the most prestigious line-up of seven figure Ferraris at Monterey. Their headliner will be the ex-Violati Ferrari GTO s/n 3851 GT. Despite the fact that no one doubts the car will reach the mid to upper eight figures, the car will be sold at no reserve.

Violati, who died in 2010, was the heir to the Ferrarelle mineral water fortune. He had a collection of over 70 cars, including 40 Abarths. The collection had been off and on the market for over two decades, but matters were complicated by tax authorities, a wife, son and mistress. His cars were ultimately purchased by a British investment group in May, and they are the consigners of the GTO and other Violati cars. All will be offered at no reserve. Another round of selling will take place at Bonhams Goodwood sale in September.

Dana Mecum is auctioning the ex-Tony Parravano 375 MM 0362 during Monterey week. In 1954, this car won at Golden Gate Park and Offutt Air Force Base (Jack McAfee) as well as at Palm Springs in October (Bob Drake). For a time, it was the fastest car on the West Coast. Credit Michael T. Lynch archive.

Some say the no reserve, especially on the GTO, is a wise marketing decision because everyone with the money will have a chance to bid as opposed to the private treaty sales that usually occur where the car is only offered to a select few. My reaction is that there are plenty of big players who do not want to see their name in Forbes, the Wall Street Journal or the Financial Times as the purchaser of a car that expensive. We shall see who is correct.

Dino 246T s/n 008 on the cover. The car won 12 races in a four year career in Europe and Australia/New Zealand. It carried Chris Amon to the 1970 Tasman Championship and Graeme Lawrence to the same championship the next year. Lawrence also used the car to take the New Zealand Gold Coast Championship in 1970 and 1971. The car will be offered by Bonhams during their Quail Lodge sale.

Besides the GTO, Bonhams will have nine more Violati cars, four of them as yet unannounced. We know the following seven figure examples will be sold – 250 MM PF Coupe s/n 0312, PF Cabriolet Series 1 s/n 0759 GT. There is also a 246T Dino monoposto s/n 008, The Violati cars are in addition to nine more Ferraris shown on Bonhams site, at least two of which are seven figure cars, a Pinin Farina Cabriolet Series II s/n 1981 and the Daytona Spyder s/n 17057.

The Violati ex-Devin 250MM on the cover of R&T with a different model.

Besides the Bonham’s cars, there will be more seven figure Ferraris at the other Monterey auctions. Here is a rundown:

Gooding & Company traditionally has had the highest sales price per vehicle during the week. As always, they have a stellar lineup of old (250 Europa GT s/n 0427) and new (333 SP s/n 041) from the venerable firm. Other Ferraris include no less than three GTCs. Rumor has it that they will shortly announce an extremely significant Ferrari in the next few days which may realize the week’s second highest price after the GTO.

RM Auctions headliners will be 250 LM s/n 6045, 250 Europa s/n 0305, 330 SP s/n 019 and F 310B s/n179 and examples of supercars, Enzo and FXX. RM will offer at least 29 Ferraris and counting.

This Ferrari F 310 B s/n 179 was driven by both Michael Schumacher and Eddie Irvine during the 1997 season. The sound of one of these makes us long for the days of the V-10 in F1. This model allowed Schumacher to enter the final race of the season still having a mathematical chance at the championship. In only his second season with the Scuderia, it was not to be. Schumi finished second by three points to Jacques Villeneuve in a Williams-Renault. This F1 car will be part of the RM armada at their Monterey auction.

Rick Cole Auctions leads off with the ex-Parravano 410 Sport s/n 0592 driven by Carroll Shelby. They are also showing a rare 275 GTB Competizione Cliente s/n 7477 and a 250 Short Wheelbase s/n 3735 among their selection of a dozen or so Ferraris. The 410 Sport was previewed in the July 8th edition of VeloceToday.

Mecum Auctions is offering another Parravano car, 375 MM s/n 0362. Mecum’s auction will also include car a 250 GT Pinin Farina Series II Farina Cabriolet.

It would seem to this observer that 80 Ferraris going over the block may not be due to the usual motivations for selling such as death, divorce and chapter 11. People with million dollar cars often have a better understanding of markets than the general public. Admittedly, they were not produced in a batch of 30 or less like most race cars, but to see six 250 GT Pinin Farina Cabriolets offered in just four days is not an everyday occurrence.

This beautiful Ferrari 250 GT Series II Pinin Farina Cabriolet will be at the Gooding sale at Pebble Beach. It is s/n 1475 and has enjoyed long term ownership by Ferrari author and historian, Hilary Raab.

There are also presently nine variants of 275 GTBs being shown and entries are still coming in. As with the Bonhams’ auction house sale, one could ask if so many significant Ferraris being consigned in one week is a sign that long time owners think the market is toppy. The Monterey auctions may prove to be a watershed week for the collector car market. Will buyers see that the upward climb continues, or will there be enough chairs for the sellers if the music stops.