by Mike –
A “New York Times” article published January 5, 2014, titled a “A Sleeping Beauty of Ferraris” by Ronald Ahrens is confusing and internally inconsistent, at least to me.
The Ferrari in question is a 1967 330 GTS to be auctioned by Gooding & Company in January in Arizona and is praised for its originality yet it is an “Exciting Candidate for a Concours-Quality Restoration” according to the Gooding catalog description.
David Gooding, the auction company’s founder and president, said in the “New York Times” that he expected the car to sell “in the neighborhood of $2 million”.
This price estimate of $2 million is what one would expect a concours quality Ferrari 330 GTS to sell for according to the “Hagerty Price Guide”.
Why would a buyer pay this amount for a car that needs a “Concours-Quality Restoration” and will be worth about the same amount after several hundred thousand dollars spent on that restoration?
Small Engine Bay Fire
On September 16, 1969 this Ferrari suffered a small engine bay fire and then was sold by the original owner and has sat not moving ever since.
The Gooding catalog says,
* A Truly Exciting Ferrari Discovery
* The Fifth of Only 99 Examples Built
* Sophisticated Celeste Blue over Dark Red Color Scheme
* Less than 23,000 Miles from New
* Very Original, Matching-Numbers Example
* Single-Family Ownership for Over 40 Years
* An Exciting Candidate for a Concours-Quality Restoration
* Never Shown, Restored, or Offered for Public Sale
* Documented by Ferrari Historian Marcel Massini
David Bryan of Gooding said in the “New York Times”,
Found in November with a coating of grime, spots of surface rust and a blackened and cracked windshield, the Celeste Blue GTS is all the more desirable as a nearly untouched example of the model, which helps Ferrari collectors and restorers to establish a baseline for the 330 series, Mr. Bryan said.
I can just see the drool of excitement as Mr. Bryan said “grime, spots of surface rust and a blackened and cracked windshield”. However, once this 330 GTS goes through a “Concours-Quality Restoration” it will no longer serve as “a nearly untouched example of the model, which helps Ferrari collectors and restorers to establish a baseline for the 330 series”.
So which is it – an example for Ferrari collectors and restorers or a candidate for a concours-quality restoration? It can’t be both.
The Dirt Is Still In Place As Gooding Likes It
Two Collector Car Experts Interviewed
The “New York Times” interviewed two collector car experts by telephone for this article, Larry Crane and Rick Cole.
Larry Crane said,
The premium for the Spider’s texture and history is in accord with the recent trend that prizes originality. Standards guiding the recognition of authentic period vehicles were codified in The Stewardship of Historically Important Automobiles
(Simeone Automotive Foundation, 2012).
Mr. Crane’s reference to the book “The Stewardship of Historically Important Automobiles” is an indication of his knowledge, however, the Gooding approach is not consistent with the philosophy described in this book in my opinion.
I pointed this out in my recent article Dirt Is Not Patina And Rust Is Not Desirable where I quoted the prime creator of this book, Dr. Fred A. Simeone,
Dirt is not patination. Dirt is something that was not added by the creator, or intentionally by the subsequent owners.
The “New York Times” said about their discussion with Mr. Cole,
His own experience roughly corroborated Gooding’s presale estimate for the spider. “I was offered a 330 GTS within the last week from one of my little spies around the globe,” he said. “It was $1.8 million.”
Mr. Cole’s reference to a car he was offered for $1.8 million is less than the Gooding estimate of their 330 GTS yet I suspect that the Ferrari Mr. Cole was talking about is in much better condition than the Gooding Ferrari.
A Contradiction
One of the mantras in the collector car world is that these cars should “be used as they were meant to be”. A car that has an engine fire and then is put is storage without any repairs for 45 years was certainly not used as it was meant to be.
If I were a potential future owner of this Ferrari 330 GTS I prefer that the original owner would have made the appropriate repairs after the unfortunate engine bay fire even if this meant new paint and replacing the “blackened and cracked windshield” and anything else that was damaged.
Then after all the repairs were completed continue to use this Ferrari as it was meant to be, which is driven not left to rot in a garage for 45 years.
But we are where we are and the Gooding team could at least clean the car for the catalog photos and the auction. I suspect this Ferrari will be as dirty at the auction as this 275 GTB was at a previous Gooding auction.
More quotes from Dr. Fred A. Simeone,
The fascination (of a barn find) is temporarily increased by dirt, rust, corrosion, and even animal infestation. However, dirt does not reflect proper stewardship!
…surface dirt is only harmful and the car would be better preserved if it was at least gently washed…
To curators and conservationists, however, dirt is harmful.
Regardless of how or when one finds an unrestored treasure, destructive corrosion, and natural nemeses to conservation should be removed.
Let us know what you think in the Comments. Is dirt an asset and does rust and other corrosion make a car more desirable?
Unfortunately, with only 99 models made, some rich idiot will probably pony up the $2 million for this car. Of course it will require a complete rotisserie restoration, an engine rebuild due to the fire, and God knows what else. After paying about $400,000 for the restoration and the removal of all of the “patina”, the car will be concours-ready, and with the rare Ferrari market being what it now is, if he holds on to it for about only five years, he will make his money back plus a profit. The rare Ferrari prices are trending astronomically upward everyday, and, do not seem to be reversing, recession or not. Glenn in the Bronx, NY.
Mike makes valid points again.
I think the premium comes from the knowledge that a new owner can be the first to dictate how the car ends up.
This is quite different from its intrinsic value as an original, unrestored object.
The hope that original patina will be preserved and only minimal intervention will take place remains.
The knowledge that incorrect or unsympathetic restoration has not already occurred is valuable.
Meanwhile, the auctioneer does his job for the vendor, capitalising on the inherent excitement of something different for the market. If he cleans the car he would need to photographically document his every move. Caveat Emptor.
The real question is “what does concours quality restoration mean.” Perfect chrome is impossible on an original old car, yet cars with perfect chrome continue to pour out of restoration shops, and perfectly good original chrome is stripped and replaced.
Only when the market matures further, and over restored cars are considered less desirable and less valuable by price than original or minimally restored cars will market commentators then adjust their descriptions.
Mike, the dirt is an asset to Goodings, they certainly want top dollar. Dirt, crud & vague patina all add to the ‘sizzle’ of the ‘steak’ they want to sell. A carnival barker remains as… ‘Come one come all’. You & me ? We just wanna clean it up.
There was a 275 GTS sold near me last year and i think it has been sold another two times since and gained 500K in price. IMO the new owner of this Gooding car should just have the engine rebuilt, drive it for a year and then sell it. A lot of these old cars that are stored properly drive really well. Not everyones cup of tea but your not going to worry about the paint getting scratched..
P. T. Barnum was correct!
The classic car market may be approaching its bubble bursting point, regardless of patina or dust… 😉
See the year end HAGI report and read the last line.
QUOTE
HAGI® Classic Car Indices ended 2013 with new highs and strong performance across all segments. The HAGI Top gained 7.91% in December and 46.75% for the year, reaching an all time high of 235.05.
The best performing marque index was the HAGI F (classic Ferrari), which gained 7.81% in December and a total of 62.14% for 2013. The table listed below further highlights key market movements for competing marques.
HAGI data indicates annual returns last seen during the early 1980’s when the markets formed a speculative bubble. Applying a mean reversal rationale, it can be argued current growth rates are unsustainable long-term.
UNQUOTE
Cars like this will need so much restoration and replacement parts that they will be a lot less original and desirable than if they’d been properly maintained. We all know that it’s better to use a car, however sparingly than not use it at all. Whoever is stupid enough to buy a car at a premium in this sort of condition will end up with a very expensive project once they’ve restored it to his former glory that they would be far better off buying one that has already been restored or better still has been looked after properly all it’s life. How long are we expected to indulge in this marketing hyperbole created by the auction houses that suggest that if we leave our prized possessions on a farmyard and/or open to the elements for a couple of years and let them fall into disrepair that they will be worth more money than if they are properly cared for?
Crispian,
There is always going to be a shortage of original unrestored cars in good condition.
I would rather have the chance to see and buy cars that have been neglected in their ‘as found’ state than try and decide whether the ‘restoration’ has been done properly.
I still consider it is better that auctioneers offer these cars as they are than tell their owners to tart them up for sale later.
As I said ‘Caveat Emptor.’
I agree and with small build quantities like this most of the good cars were already restored back in the 80-90’s, there is nothing better than knowing that most of the bolts on your car were put on by the factory workers.
Why not use the Ferrari Classiche program on a different car?
If you don’t like the high percentages the auction companies take Ferrari Classiche program is in a much higher realm
I am not talking about the auction commissions. I am talking about the mark-up factor for the “originality” and the “dirt as patina and rust as an asset” sales approach which some auction companies have perfected.
If the buyer of this Ferrari pays $2 million as Gooding estimates and then pays for a concours restoration at about $400K – then they have a car worth $2 million that cost them $2.4 million.
I contend that it would be much cheaper to buy a condition 3 or 4 car and have the restoration done along with a Ferrari Classiche certificate and the owner would be ahead financially.
IMO Gooding is shooting for the moon on this, pushing the envelope and will be happy for much less. They have created the attention they wanted …..mission accomplished
Price escalation with out end users can be a dangerous game. When the music stops where does the market go?? Cars sold multiple times in a few months clearly represent speculation. Which Ferraris will fall in price in the next 12 months because of “no end users”? Anyone have a hunch about 308, 328, 512 ????
After all the hype is over and the money spent, the new owner will have a car he can’t show or safely drive. At that point reality will set in. “What have I purchased” would be an appropriate reaction! Get a life, people! And the auctioneer will be nowhere to be found to offer words of comfort like patina, significant or original.
Gooding has been very successful at selling dirty, rusty “barn finds” – what I call the “Dirt Is Patina And Rust Is An Asset” sales strategy – read more below:
https://mycarquest.com/2013/12/dirt-is-not-patina.html
https://mycarquest.com/2013/12/more-dirt-pretending-to-be-patina.html
https://mycarquest.com/2011/09/1966-ferrari-275-gtb-alloy-long-nose-preserved.html
https://mycarquest.com/2012/08/a-dirty-1965-ferrari-275-gtb-sells-at-gooding-for-big-bucks.html
I have no idea how high it will go but there are more global buyers than ever before, this combined with a limited supply??
There is more to this story – stayed tuned to My Car Quest for an update soon.
I love the “carnival barker” comment by Bob Schneider, the “P.T. Barnum” comment by Mel Walters and the Darren Frank comment “the auctioneer will be nowhere to be found to offer words of comfort like patina, significant or original”.
You are all spot on as were many others with intelligent comments.
I am curious to see what this Ferrari sells for – I will keep you all informed.
Mission accomplished
Mike,
Don’t forget, let’s say the successful bidder acquires the little Ferrari 330 GTS for $2,000,000.00, also gets to add $200,000 buyers premium for being the successful bidder. Then he or she needs to decide whether to restore the barn find, service it to keep it original and enjoy it, or a complete restoration. If the restoration costs $600,000.00, then the total cost will be $2.8 or more. There is a difference between a well preserved original, collector car and a neglected, collector car, which this car seem to be. A well preserved, original Ferrari should command a tremendous premium, however, because of the nervous volatility of the collector car market, no matter the rough condition of this Ferrari, I believe the sales price will set a record. Regardless, this 330 GTS is a very desirable Ferrari and needs to be brought back to life. Scottsdale 2014–let the fun begin.
David Grant