Articles

Michael Sheehan's Ferraris-online.com Article

High-End Ferraris Booming

$35m for a 250 GTO and $25m for the 1958 Le Mans-winning 250 TR show the Ferrari cream is rising into the stratosphere

As appeared in:

Sports Car Market—August 2012 issue

Sheehan Speaks

by Michael Sheehan

Ferrari 250 SWB Competizione, sold for $5.28m at RM’s 2011 Monterey sale
Ferrari 250 SWB Competizione, sold for $5.28m at RM’s 2011 Monterey sale

We all know that the planet went into recession in 2007 — and fell off the proverbial economic cliff on September 15, 2008, when Lehman Brothers was thrown into bankruptcy. The Dow dropped 500 points on that day — and then even further. Banks and businesses failed, and the gloom set in. Many markets slowed or froze. In the collector car market, both buyers and sellers went into hibernation for the remainder of 2008 and stayed in hibernation through 2009.

All markets eventually turn, and in my April 2010 column “250 GTO Sets Ferrari Record at $26m” (April 2010, p. 40), I reported on the sale of 250 GTO s/n 3943 for a Ferrari world record price of $26m. 250 GTO s/n 3943 was described by my fellow Ferrari historians as “bulletproof” in its race and ownership history. Tom Price, the seller of 250 GTO s/n 3943, bought the car in 1983 for $300k, so the sale of this GTO for $26m was one of the best long-term automotive buys of all time.

Further down the food chain, I also reported on the ex-Lorenzo Zambrano 166 MM Touring Barchetta s/n 0058M and the ex-Manny Del Arroz 375 MM s/n 0490AM, both trading in the $5m range. Both cars were stellar: 166 Barchetta s/n 058M was one of the most original Barchettas in existence, while 375 MM s/n 0490AM was an amazing barn find. When restored, it became one of few Ferraris to win its class, scoring 100 points at Pebble Beach. This author had sold 166 MM s/n 0058M in November of 1998 for a far more modest $1.2m, so the latest sale at $5m represents a serious long-term market improvement.

Are Ferraris booming or bubbling?

Only two months ago, in my June 2012 column, “Are Ferraris Booming or Bubbling?” (p. 44), I reported on the market’s upward trends. The August 2010 Monterey auctions had paid proof to a collector car revival with a whopping $172m in sales, up by $52m from 2009. These impressive results were reinforced at Scottsdale in 2011 with a very impressive $159m in sales. Monterey 2011 continued the turnaround with total sales reaching the $200m mark. The top end led the rally with Gooding’s sale of 250 TR s/n 0666 at $16.4 and RM’s sale of 250 SWB Competizione s/n 2209 at $5.28m. The strength was in the top-end Ferraris.

2012 began with a bang, as collectors spent $182m at Scottsdale, easily beating 2011’s $159m and also beating the all-time high of $163m back in the boom days of 2007. The upward trend continued at Amelia Island with $59m in sales, up from $42m in 2011.

Amelia Island also saw the boom go down-market — to more affordable Enzo-era cars, with 246 GTS s/n 5820 selling for a staggering $363,000 at RM and 246 GT s/n 3496 selling for an equally staggering $214,500 at Gooding.

Life is good for the top of the 1%

Since I wrote “Are Ferraris Booming or Bubbling?” the top end of the market has accelerated into a brave new world of market highs. Very-long-term collector Pierre Bardinon has now sold his 1958 Le Mans-winning 250 TR s/n 0728 for about $25m, almost $10m more than last year’s sale of 250 TR s/n 0666TR. Needless to say, a Le Mans win with Phil Hill and Olivier Gendebien at the wheel explains some of that increase. The buyer, in a private sale, was London-based Brandon Wang. Brandon is also the long-term owner of 250 GTO s/n 4219, which he purchased in a private sale back in the good old days of 1993 for $3.5m.

250 GTOs, the flavor of the month

Four 250 GTOs have sold recently. GTO s/n 4675, a ’62 converted to the ’64 body style, was purchased by English TV and radio personality Chris Evans for $18m in 2010, and has now been sold to Jean Pierre Slavic in Switzerland for $25m in another private sale.

Jon Hunt, executive of an England-based real-estate group, has sold his 250 GTO s/n 5095 to Mexican billionaire Carlos Hank for about $32m in yet another private sale. Thanks to a second-place finish at the 1963 Tour de France, 250 GTO s/n 5095 was among the best of the GTOs. Hunt had paid about $23m for s/n 5095 only a few years ago, so it was a good investment.

For those who track ultra-high-dollar Ferraris, Carlos Hank was also the buyer of 250 TR s/n 0666, which he purchased at Gooding’s Monterey 2011. Adding to the high-end Ferrari shuffle of musical chairs, Carlos Hank has apparently sold his ’64 GTO s/n 5575, with a stellar Le Mans history, to Rob Walton, sales price not yet known.

250 TR s/n 0666, a $16.4m sale in November 2011
250 TR s/n 0666, a $16.4m sale in November 2011

A new world record

Setting an all-new market high was the recent private sale of 250 GTO s/n 3505, sold by the Dutch-born businessman Eric Heerema for $35m. The buyer was Craig McCaw, co-founder of McCaw Cellular, which was acquired by AT&T for $11.5 billion in 1993. Heerema had purchased 250 GTO s/n 3505 a decade ago for about $8.5m from Japanese collector Yoshiho Matsuda, making 250 GTO s/n 3505 an astute investment. One of only 39 GTOs produced from 1962 to 1964, s/n 3505 was finished in the unique Pale Apple Green of Sterling Moss’s UDT-Laystall race team, but Moss had never driven the car. The car raced at Le Mans in 1962 but did not finish.

250 GTO s/n 3505 GT has now become the world’s most expensive collector car, at $35m. The record for “most expensive collector car” had been a 1936 Bugatti Type 57SC Atlantic, bought by the California-based collector Peter Mullin in 2010 for a price from $30m to $34m.

When discussing these Ferrari Fantasyland prices, we must note that the 250 TR and 250 GTO are simply the two most coveted and prestigious Ferraris built. Having owned a 250 TR (s/n 0732TR) and sold two different 250 GTOs (s/n 3387 and s/n 3909), I can say that they are both beautiful to behold and a joy to drive at any speed. They are also a guaranteed entry to the most prestigious auto events on the planet and become the instant centerpiece of an ultimate collection.

Upward movement in lower-level Ferraris

All this represents a substantial increase in activity and pricing across the top-end world of collector cars as buyers pour money into hard assets and collectibles. What is noteworthy is that every sale was a quiet, private sale.

There is no lack of buyers at this level, and all value their privacy.

Others can take comfort in upward movement in the low— to mid-level Ferrari market as well. A no-stories, “chairs and flares” Dino with full books and tools will easily break the $300k barrier today, while the best-of-the-best Daytonas now break the $400k barrier.

I believe we’ll continue to see both auction sales and private sales grow steadily this year. There’s new-found confidence in the collector car market, and buyers are speaking loudly with their wallets and wire transfers.