Auction Report

New Buyers Ignite the Market in Milan

RM Sotheby’s Duemila Route Exceeds Expectation

Posted: November 29, 2016 5:00 pm
by Dirk de Jager

RM Sotheby’s hosted its first-ever Duemila Route auction in Milan, Italy over the past weekend from Nov. 25-27. Over 800 no-reserve lots on the docket attracted an unseen number of people, with 4,000 registered bidders and 83 percent of buyers being first-time RM Sotheby's customers. 

The real question drawn from this auction was if the 83 percent of new buyers people were actually car people or a whole new legion of investor/speculators. Considering what a buying frenzy we witnessed for three days straight, I don’t think you can say that a lot of cars were bought with knowledge or insight.

Despite all of the obstacles for the bidders, there was no stopping the totally crazy bidding wars that took place over the three-day auction. Many bidders would be scared to purchase restoration projects with no paperwork for the same and even higher prices toward the same model on the open market. But that didn’t stop those who were in the room in Milan.

Normally, you would expect potential buyers would do their research on the model in question so that they have an idea on what the market value would be. Then, inspect the car on scene to see what the condition is, ranging from total restoration project to in driving order or top condition.

And let’s be clear, a big portion of the docket were either resto projects or daily driver cars that needed some form of service on them. This one collection sale had been initiated by the Italian government after seizure of the entire collection a few years ago, so most of the vehicles had been sitting for several years.

Although RM Sotheby’s was working closely with the Italian government to get the vehicle’s documentation sorted ASAP, it was still expected to take up to eight weeks after the sale for the majority of the vehicles. However, there were a handful of lots that had its Italian libretto announced as it crossed the block.

Despite all of the obstacles for the bidders, there was no stopping the totally crazy bidding wars that took place over the three-day auction. Many bidders would be scared to purchase restoration projects with no paperwork for the same and even higher prices toward the same model on the open market. But that didn’t stop those who were in the room in Milan.

Take lots 874 and 905: a 1962 Maserati 3500 GTI Coupé Touring and a 1961 Maserati 3500 GT Coupé Touring. The 1962 was a complete car that probably needs recommissioning only and the 1961 was a full restoration project. Even though the body was already painted, it was missing some mechanical parts, all the trim, interior and glass.

Now, in the past auction season, these went from €130,000 (US $137,560) complete but recommissioning cars to €250,000-€300,000 (US $264,538-$317,445) for restored car. On Sunday, the 1962 car sold on the block for €180,000 (US $190,467) which makes this a great purchase. Thirty lots later, the 1961 Maserati sold for €120,000 (US $126,978), which makes this car seem overpriced.

There was a diamond in the rough lot that stood out from the rest. But in order to find it, you needed to do your research. A 1953 Alfa Romeo 1900C Sprint Touring, in good driving condition that needed a checkup, was estimated at €160,000-180,000 (US $169,304-$190,467).

Even for a car without history, that's well below market price. But the buyer happened to uncover that this car had driven the Mille Miglia, and had its original license plate still on the car. Then we are talking about a whole different market value for that car. The Alfa Romeo sold for a hammer price of €320,000 (US $338,608), making this a tremendous find and purchase.

But it wasn’t the classics or even the modern collectors that raised eyebrows and disbelieving sighs.

Take, for instance, a 1946 Alfa Romeo 412 Spider Vignale Replica, in very good condition, ready to be driven. But a replica nonetheless, even stated on the screen and during the announcement by the auctioneer. So it should be worth the estimated €30,000-35,000 (US $31,745-$37,035), yet it hammered at €270,000 (US $285,701). For not the best replica and besides your own driving pleasure is not eligible anywhere to use.

Or the 1979 Opel Kadett C Coupe, which should be max €25,000-30,000 (US $26,454-$31,745) that goes on hammer for €42,000 (US $44,442).

The hits like that just keep on coming. The biggest shock was without a doubt a 1990 Fiat Panda 4x4. Now the Fiat Panda is really great car for its stature and value and remains a popular model, even in the newer versions. But those you pick up in decent shape, especially in Italy, for €2,500-3,500 (US $2,645-$3,704) without a problem. Yet, during that massive bidding war that ensued, this one managed to get closed at €12,000 (US $12,698).

Yes, you are reading that correctly. That’s more expensive than what you paid at the dealership brand spanking new! Even though the entire room, including the auctioneer, was laughing during those bids from utter disbelieve that it became so funny.

Was the bidding war between two bidders just because they wanted to prove a point, or where they that sick and tired from being outbid on crazy high prices that they now said, fine the auction is nearly finished, I am taking something back home. Either way, these cars couldn't have been bought for investment value. At least they can claim that they’ve set the world record price for the model.

I would have gone for the youngtimer Jags then, they proved to have some issues selling on the block and stayed within a normal market range. A 1987 Jaguar XJ6 hammered for €3,000 (US $3,174), which, let’s face it, would be a lot nicer to drive around with then a Panda. Or the 1949 Lancia Ardea, which I fancied myself with an estimate for €2,500-€5,000 (US $2,645-$5,291). You can find them online today starting from €9,000-€15,000 (US $9,523-US $15,872), but for some reason the gavel came down here on €30,000 (US $31,745). Needless to say, I do not own an Ardea now.

Even after all this, the most bizarre thing occurred on Sunday. Lots that had been sold on Friday and Saturday, even one that had crossed the block 40 minutes earlier, were re-offered back for sale without any explanation. Did the bidders back out? Did they not have the funds available? Or did they realize they went a tad overboard on raising their bidders paddle. 

The re-offering from Sunday was the 2008 Porsche 997 GT2, a car that is normally around €185,000 (US $195,758). On this lot, it was clearly stated that there would be 22 percent VAT applicable on the full amount (hammer plus commission), which is listed on the car, in the catalog and even repeated before opening the lot to avoid any doubt.

The car proceeded to sell for €230,000 (US $243,375), only to be re-offered shortly after and selling a second time for €175,000 (US $185,176), already a lot more “sensible” price. Did somebody have some buyer’s remorse? Either way, the response and the discussions on the aftermath of this sale will be talked about for a long time to come.

In all, RM Sotheby's auction in Milan brought in €51,260,000 (US $54,240,800) and was a ravenous success for the auction house, especially since it was its first time in a new market. Unquestionably, the market was on fire this past weekend. If that’s a good thing or not remains an open question. RM Sotheby’s will hold its next auction in Phoenix, Arizona from Jan. 19-20, 2017.

Image gallery photos courtesy of Dirk de Jager.
Article photos courtesy of RM Sotheby's.

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