The coronavirus pandemic has ushered in an era of economic uncertainty. It also touched the community of collectors, who saw many canceled events. Fan club meetings, road trips, auctions… our community has to work its way down. Now is the time to take care of our dear cars while we wait to get back on the road.
The classic market is resilient
However, early observations show that the vintage car market is holding up well. The classic automobile proves, as in 2007-2008, that it is an excellent protection tool against financial fluctuations. An object of pleasure and a wise investment, it retains its value when economic uncertainty increases.
Thus, the price indexes of old cars display remarkable strength. The Hagerty index, for example, has been very stable since May 2020, after suffering a decline in March-April 2020 (-2.4%), mainly due to the decline in the most expensive cars on the market. The “Blue Chip” price category, which had grown a lot since 2015, depreciates by almost 10%, but the prices of the most affordable car categories remain stable or increase despite the crisis.
How the classic car industry adjusts to the sanitary crisis
This solid pricing comes in the context of accelerating changes in the vintage car market. The pandemic thus plays a catalytic role in the digitalization and globalization of the market. Some auction houses have therefore chosen to switch to a 100% digital offer. Online sales sites have seen their traffic explode during the lockdown period and since then.
What will happen in the next few months as our economy is gradually recovering? Opinions are divided and caution remains in order. After the 2008 crisis, some categories of older cars had seen their prices fall by around 20%, especially those whose ratings had risen the most before. Opportunities then appeared and the market continued to evolve in favor of youngtimers. Classic car prices then quickly resumed their upward trajectory after 2008, benefiting largely from the upturn in activity in the following years.
Optimism and prudence
We therefore remain optimistic about the medium-term future of the vintage car market. In a climate of uncertainty and monetary glut, the latter is a superior asset class, offering real scarcity. It is above all a huge object of passion for collectors, as are many vintage products for which demand remains strong (vinyl records, furniture from the 60s, vintage fashion, etc.).
Finally, it is benefiting from a profound change in the sector, with the emergence of new 100% online sales tools. Based on strong participation from the collectors’ community and a requirement for transparency on the part of sellers, these tools give a global dimension and unprecedented liquidity to the vintage car market, including for the most accessible models.