For much of the last 24 months, the changes from one edition of the Hagerty Price Guide to another could be summed up in one word: Appreciation. The recent update released this fall, however, tells a more complex story. We can still point to plenty of cars that are climbing, yet there are also more than an isolated few that have lost ground.
As any good mechanic knows, when your standard instruments aren’t giving you enough information, it’s time for deeper diagnostics. One of the key tools on our shelf are indexes based on the price guide. In fact, we have seven: Blue Chip, British, Ferrari, Muscle Car, Postwar German, 1950s American, and Affordable.
Each index is comprised of the movers and shakers within a specific segment and gives insight into the health and trajectory of a specific part of the market, much like stock market indexes can help suss out trends in sectors of the economy. Indexes are calculated an average of the #2 (excellent) condition of the component vehicles and are updated quarterly, along with the price guide.
What’s most obvious in looking at the indexes below is that they’re all doing quite well. Of the seven indexes tracked in the Price Guide, six experienced growth, with four achieving an all-time high rating. The remaining index, 1950s American Cars, remained flat.
Delving deeper into the data, though, and the story gets more rich and complex.
Top of the market—is the stock market's loss the collector car market's gain?
Our Blue Chip index, which measures the performance of the top end of the Price Guide, performed exceptionally well. Over half of the 25 component cars posted gains with four cars posting gains over 10 percent. Overall, the Blue Chip Index posted a 3 percent gain for the quarter, the biggest move in a year. More segment-specific upper-end market indexes, like Ferrari and German, also posted a 3 percent increase. Like with Blue Chip, the Ferrari index saw over half the component vehicles gain value, while the German index experienced more focused increases at higher rates.
To some extent, these results echo the gangbusters sales at Monterey in August. Traditionally, we see a slowdown of the top of the market subsequent to Monterey, so it should come as no surprise if these indicators level off somewhat in the fourth quarter. Yet the top of the market's strong showing in late summer—even as other segments were softening—could also be a sign that, with inflation high and the stock market underperforming, some high-net-worth individuals see million-dollar cars as a safe (and fun) port in the storm.
Mixed results in the middle of the market
While the top of the market is clearly influenced by activity coming out of Monterey specifically, the middle of the market is a bit more complicated. Moving out of the realm of cars that regularly trade in the high six-figure to seven-figure range, movement was a tad more subdued. The British, Muscle Car and 50s American indexes all increased by 1 percent or less. Unlike the top of the market, component cars for these segments had very mixed results.
Indexes like Muscle Cars and British still reached all-time highs, but the rate of increases is clearly slowing. Zooming in closer, we see that a few significant gainers made up for a number of small losses. With 50s American cars, there was plenty of activity but the gains and losses washed out completely.
That's not to say the middle of the market is declining. We'd call it leveling out or, more precisely, regressing to the mean. Many of the vehicles that have softened, like '65 Pontiac GTOs and '70 AAR Cudas, experienced incredible growth earlier in the year.
A caveat here is that the fall is typically a quiet time for buying and selling in this price range. Muscle car acolytes in particular, may have their sights set on the January sales in Kissimmee and Scottsdale.
Affordable Segment—Signs of softening as "affordable" climbs out of reach for some
Hagerty's Affordable Car Index has been the most consistent gainer of all. So much, so, in fact, that the term "affordable" may no longer be appropriate. Component cars like the Datsun 240Z and 1970 Camaro SS 350 were once very inexpensive cars and have since exploded in value. These cars, however, did not drive this quarter's increase. Rather, huge gains from the likes of the Volkswagen Beetle totally balanced out losses by cars like the 65 Mustang GT and the MGB.
Playing "what if" here, had Beetles not posted such substantial gains, the Affordable Index could very well have seen its first loss since 2011. Of course that's not what happened, but the takeaway here is that the lower echelons of the market may be softening. It is unreasonable to expect these cars to take a big enough step back to erase the regret of not buying a 240Z, Beetle, or a TR6 back when they were dirt cheap, but we could see some sanity coming back into the market for the collector of more "average" means.
I personally don’t things being sustainable for too much longer if present trends continue. I have thought about selling my car so I can afford to do something else but I just don’t see the market giving me what I need.
Fortunately, I have never purchased a car as an investment. My choices were always made as an enthusiast.