Monterey Car Week 2024: What the Classic Car Market’s Shifting Gears Mean for Investors
This year’s Monterey Car Week, including the iconic Pebble Beach Concours d’Elegance, is more than just a showcase of automotive beauty—it’s a revealing pulse check on the collectible car market’s evolving landscape. With up to $400 million worth of classic cars crossing the auction block, investors and collectors alike are watching closely as this market navigates a significant generational and economic shift.
Market Snapshot: Declining High-End Sales Signal a Turning Point
According to Hagerty, roughly 1,140 classic cars are expected to be auctioned during Monterey Car Week, with total sales estimated between $367 million and $409 million. While these figures might seem robust, they represent a third consecutive year of decline and an 18% drop from the $471 million peak in 2022. Notably, the ultra-high-end segment—the marquee $10 million-plus cars—is at its weakest in over a decade, with only one such car expected to sell this year.
This contraction in the top-tier market is a crucial signal for investors. The average sale price has slightly dipped to $473,000 from $477,000 last year, reflecting a subtle but meaningful cooling. Simon Kidston, a renowned classic car advisor, aptly calls Pebble Beach the “annual health check” for the market, underscoring its role as a barometer for investor confidence.
Why the Slowdown? Beyond Global Uncertainty and Interest Rates
While macroeconomic factors like geopolitical tensions in Ukraine and the Middle East, China’s economic softness, and higher interest rates (now offering risk-free returns above 4%) have certainly dampened enthusiasm, the most profound driver is a generational transition. Baby boomers—long the backbone of classic car collecting—are aging out or downsizing, while millennials and Gen Z collectors are reshaping the market with different tastes and priorities.
This generational handoff is colossal; an estimated $100 trillion is expected to transfer from older to younger generations in the coming decades, fueling a new breed of collectors who prefer fewer, newer, and more practical collectible cars. This shift has created an oversupply and price decline for 1950s and 1960s classics, as many boomers liquidate or pass on their collections to heirs who may not share the same passion.
The New Collector Profile: Practicality Meets Passion
Millennials and Gen Z are not just buying fewer classic cars—they’re gravitating toward later-model supercars from the 1980s, 1990s, and 2000s, which blend rarity with usability. For example, the 1989 Ruf CTR “Yellowbird,” a cult classic among enthusiasts, recently sold for a record $6 million, signaling strong demand for these newer collectibles. These buyers want cars they can enjoy daily, not just museum pieces locked away in “Garage Mahals.”
This trend is reflected in the average model year at Pebble Beach auctions shifting from 1964 two years ago to 1974 this year, with a barbell distribution showing interest at both ends—from 1950s classics to modern supercars.
What Investors Should Do Differently Now
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Reassess Collection Composition: Investors should consider diversifying their collectible car portfolios to include newer supercars favored by younger buyers. While iconic classics retain intrinsic value, the market’s liquidity and demand are increasingly concentrated in post-1980s models.
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Explore Private Sales: With falling prices at auctions, many sellers are turning to private transactions to avoid public price disclosures. Advisors should tap into these private networks to find deals and discreet sales opportunities that might offer better value.
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Monitor Market Sentiment Closely: As Simon Kidston warns, treating collecting purely as an investment risks turning it into a speculative bubble akin to crypto. Investors must balance passion with prudence, focusing on cars with strong provenance, usability, and historical significance.
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Prepare for Volatility in Modern Supercars: The rapid price appreciation in modern supercars may be fueled by momentum trading, creating potential for sharp corrections. Investors should be cautious and conduct thorough due diligence before chasing the latest trends.
What’s Next? Forecasting the Road Ahead
The classic car market is undergoing a profound structural change. While prices for many vintage models have softened by 20% to 30% from recent peaks, this correction could present attractive entry points for long-term investors who appreciate the historical and cultural value of these vehicles.
Moreover, as younger collectors gain wealth and influence, we expect the market for practical, affordable exotics and rare modern supercars to expand further. This shift aligns with broader luxury trends where experiential ownership and usability are prized over mere status symbols.
Unique Insight: The Rise of Hybrid Collectibles
An emerging trend worth watching is the growing interest in hybrid collectibles—cars that combine classic design with modern technology, such as electric conversions of vintage models or limited-edition supercars with eco-friendly features. These vehicles could capture the imagination of environmentally conscious younger collectors, blending nostalgia with sustainability.
Final Thought
For advisors and investors, the key takeaway is clear: the collectible car market is not just about nostalgia—it’s a dynamic ecosystem influenced by generational wealth transfer, economic factors, and evolving consumer preferences. Staying ahead means embracing change, diversifying holdings, and understanding the nuanced motivations behind today’s collectors.
By doing so, you position yourself not just to survive the current market shifts but to thrive as new opportunities accelerate in this fascinating intersection of passion and investment.
References:
- Hagerty Market Analysis, 2024
- Knight Frank Luxury Investment Index, 2024
- Insights from Simon Kidston, Classic Car Advisor
- Gooding & Co. Auction Results, Monterey Car Week 2024
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Source: Classic car auction sales expectations