Starting Thursday, Barrett-Jackson will host its sixth annual Las Vegas auction, where hundreds of gorgeous, rare, and unusual vehicles will go to the highest bidder.
To find out how the leading auctioneer finds the cars, makes sure they’re the real deal, and gets them on the block, we spoke with CEO Craig Jackson, who gave us an inside look at the whole process.
There are three basic steps: verification, price setting, and the auction:
Finding the Real McCoy
When a client brings a car to Barrett-Jackson, the first thing the auction house does is make sure it isn’t being duped (likely by whoever sold the car to the current owner). Jackson has built a team of a dozen car experts, all of whom have expertise in one type of car or another.
The company was “founded by car people, and it’s still run by car people,” Jackson said. He himself owns about 30 vehicles.
His experts know their fields, and often have access to original automaker manufacturing records. As cars go up in value, Jackson said, frauds become more common, and better made. The fake cars come with forged paperwork, which is where the original records come in handy.
Since his team can’t fully disassemble every car they look at, “sometimes things slip through the cracks,” Jackson said. But he’s confident that their verification system is excellent. The company finds about 10 fakes leading up to every auction, and it’s not a fun conversation to have with the owner.
“Usually there’s about 10 seconds of silence on the other end of the phone,” Jackson said.
Setting The Price
Unlike most auction houses, Barrett-Jackson sells most of its cars as “no reserve,” meaning there’s no minimum sale price, and no restriction on who the buyer is. That creates risk (since the car could sell for very little), but can also attract more potential buyers, and make the auction more exciting, Jackson said. Barrett-Jackson, he added, makes sure the seller understands the car’s potential price point.
During economic downturns, sales flatten out, and owners usually hold off on selling. After 2008, though, the rare-car market came back quickly, Jackson explained. Now, “cars are bringing all-time high prices.”
At Barrett-Jackson’s January 2013 Scottsdale auction, it sold dozens of cars for more than $US100,000 each, including a 1947 Talbot-Lago for over $US2 million. Last month, an extremely rare Ferrari sold for a record $US27.5 million.
Part of Barrett-Jackson’s job is knowing who the buyers are, and what kinds of cars they want. These days, Mercedes-Benz Gullwings and Ferrari 330s are especially popular.
Today’s market is drawing many Asian buyers, according to Jackson, and customers from Russia and the Middle East were at Scottsdale.
Building The Auction Bell Curve
Different auctions draw different buyers, so Barrett-Jackson carefully chooses where it sells each car. Scottsdale is mostly high-end, while Las Vegas is more across the board, with plenty of late model exotic and modified cars.
The key to a good auction, Jackson explained, is building a diverse docket of cars for each of the three days. The goal is a bell curve in terms of value, starting and ending with less expensive cars. A healthy of mix of vehicles throughout is crucial, to keep things fresh.
Parts of the auctions will be broadcast live (by Fox Sports and National Geographic), so the most interesting cars will be scheduled to be sold at those times. And it’s all scheduled at least a month in advance (with allowance for the occasional last-minute entry).
The hundreds of cars that will cross the block in Las Vegas include a 1998 Ferrari F355 FI Spider, a custom “Prowler”, and a range of Corvettes from 1962 to 2009.
At the top of the line are the “Select Collection” cars, including a one-of-a-kind 1925 Rolls-Royce (specially outfitted by an Indian maharaja for Bengal tiger hunting expeditions), a 1956 Mercedes-Benz 300SL Gullwing Coupe, and a 1967 Ferrari 330 GTC. Each could sell for hundreds of thousands of dollars.
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