The classic car market is back to its pre-crisis level in the United States

The Hagerty Market Index recorded its fourth consecutive increase in January 2021, reaching its highest level since February 2020. In the auction market, the number of cars sold and the median sale price are up from last month. More cars are also sold in the private market compared to December. The optimism of market experts and owners has been at its highest for several years, and external market forces (such as the stock market and monetary base growth) are creating positive pressure on prices.

The Hagerty Index in 2020 (source: Hagerty)

Classic car prices return to pre-Covid levels in the United States

2020 was a crazy year. Pandemic, economic uncertainty, presidential election in the US… this context weighed on the vintage car market. The most visible consequence has been the cancellation of most major auctions, and the boom in online sales platforms. Prices gradually decreased until August 2020 and then rebounded throughout the second half of 2020.

Thus, the index reached 61.6 in January 2021, up 4.5% compared to its value in September. It is now above its level prior to the sanitary crisis (60.6 in April 2020). Even though the benchmarks relate exclusively to the American market, this trend is reassuring for the entire world market, as the United States is the most active market for classic cars.

Youngtimers and mid-range cars drive the global market

The Covid crisis seems to have strengthened the most dynamic segments of the classic car market. There is still a catch-up phenomenon in the “mid-range” segment, which includes some older cars that are more difficult to find in good condition. Thus the “Affordable Classics” index (Index of collectible cars priced under $ 30k) increased by more than 15% in 2020. Youngtimers (cars produced in the 1980s and 1990s) continue their ascent, in the United States as in Europe. In the spotlight, there are mainly German cars, but not only. As for traditional oldtimers, the youngtimers effect is becoming generational and concerns a growing group of vehicles of the 80s and 90s.

This youngtimer fever is observed in particular on the auction market. For instance, three icons from the early 1990s largely exceeded price expectations on January 25 at the RM Sotheby’s sale in Scottsdale, Arizona. An M3 Evo 2, the most desirable of the first-generation BMW M3 family (E30), was sold for $212,800. With its unique style, and a production of only six hundred copies, this M3 of 238 hp has reached price levels reserved for older prestigious models. Its rival of yesteryear, a Mercedes 190 E 2.5-16 Evo 2 (508 units produced), was sold for $268,800. A 1994 Lancia Delta HF Intégrale Evo 2 fetched a price of $131,600.

The oldest and most expensive oldtimers were negatively impacted by the economic downturn

Conversely, the most highly rated cars suffered from the COVID crisis. Prestigious cars from before the war and from the 1950s, considered as blue chips for a long time, have depreciated significantly over the past year. The Ferrari index, made up of the rarest Maranello cars, continues to fall, with a drop of nearly 10% in 2020. The fall is less important for the “1950s American” and “blue chips” indices, but is still significant.

ferrari-335-messi

The covid crisis has therefore shaken up the players and the balance of power in the classic car market in 2020. The rise of youngtimers has confirmed the growing importance of a new generation of car collectors. Conversely, the charm of the 50s and 60s fades away as the oldest collectors are often forced to sell their collection. More adapted for everyday use, easier to upgrade to modern standards, youngtimers combine modernity and nostalgia, leading the classic car market to new horizons.

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