RM teaches: if the world changes we can easily adapt

With over a billion people forced to stay home by Covid-19 it was inevitable that even the auctions would be forced to make a pit stop.

Most of them decided to cancel or postpone, but RM attempted a completely different route, offering an “eBay style” sale with all the lots on offer for 7 days and sales made upon expiry of the allocated time. Offering 250 cars under this formula ran the risk of “falling into some holes”. But RM paved its road to perfection and very quickly indeed, and the results were exceedingly encouraging.

It is worth analysing their strategy because it is an excellent example of marketing (and timing):

• they carried out an intensive web campaign for all potential buyers, constantly updating the level of the offers received;
• They appointed cheerful and very competent online consultants to answer every request;
• they were extremely serious and honest, multiplying the number photos of each lot available on their site including many that presented (clearly and unequivocally) all the small defects of each individual car.
• The result went far beyond expectations: not only did they sell the most attractive cars by price, but they also sold three of the four top lots (all above $650,000) and the fact that they reached a total turnover of over $13.7 million meant they did their job really well.

The most expensive lot was a 1996 Porsche 911 GT2 sold for $891,000

And that’s not all: many justifiably thought that the more recent cars would have fared better than the older ones since the former are aimed at a younger audience that’s more accustomed to buying over the internet, but the RM team disproved this theory by selling very well even the older lots. The best deal of the day was the 1996 Porsche 911 GT2 with only 30,000km on the clock. The lucky buyer managed to take home a car that was worth much more than the $891,000 paid (in fact, the estimate was $950k-1,100,000).

In recent years this car has exploded, rightly I would say, and the latest results place it at the top of that estimate. Looking at the numbers, the new owner took home a bargain. I agree, in fact most of the cars on offer at this auction went for slightly less than their market prices but for RM this was not a problem, given the fact that they saved a considerable sum on the non-organization of the physical auction.

On the market front, the explanation could be that potential buyers took some time to see how the pandemic (and consequently the economic situation) evolved before embarking on a major purchase. This hypothesis could also be confirmed by the second most expensive car sold by RM. A 2019 McLaren Senna. During its annual Arizona auction in January, Gooding sold one with just 88 miles from new on the clock for $978,500 (slightly below the estimate of $1-1.2 million). This time at RM the new buyer, for a very similar example with just 200 miles on the clock, saved over $130,000, with the hammer sealing the sale at $847,000. A 15% difference, hardly justifiable because of the extra mileage, also because the estimate was, appropriately, between $950-1.1 million.

The second best lot was a 2019 McLaren Senna sold for $978,500

Same year but different prices for the third and fourth most expensive lots.

The 1963 Shelby Cobra 289, the third most expensive lot sold, is one of the cars loved the most by even the youngest collectors and went for $682,000, significantly below the estimate ($750-850,000). But the real surprise of the auction was another car. We are still talking about a car from 1963, but this time it was the least desired by the youngest collectors.

The third most expensive car was a 1963 Shelby 289 Cobra sold for $682,000

The Rolls Royce Silver Cloud III DHC is not quite what one would expect to see at an online auction and, also thanks to a previous conversion from the right-hand drive to left, I predicted it wouldn’t sell. Even the experts of the auction house must have had the same thought and, probably, they forced their hand to lower the reserve price. And yet the car, although fully respecting the “rule” of not reaching its estimate ($500-550,000), held the flag high by exchanging hands for $434,500.

The fourth most expensive car was a 1963 Rolls-Royce Silver Cloud III sold for $434,500

What could I say about the “2017 Ferrari LaFerrari Aperta just-out-from-the-dealer” in triple-layered yellow (a $28,000 option) with just 175 miles from new? It stopped at $3,840,000 and returned to the seller. Maybe we forgot that price always makes it the market? It is worth remembering.

The hoped-for price target was too high for the beautiful practically new 2017 Ferrari LaFerrari Aperta