% Road to 2030: Buyers are moving into driver’s seat at collector car auctions

Editor’s note: This is the fifth in a week-long series that looks to the future of the collector car hobby. Today, John Kruse, co-founder of Worldwide Auctioneers, considers the future of collector car auctions. Kruse, who is in his late 30s, grew up as part of an Indiana family well known through several generations for its various auction businesses. He also owns the Reppert School of Auctioneering, the largest and oldest continually operated auction school which was founded in 1921.

We have gone through a period of time where the auction companies, which for lack of a better term have largely been car dealers who have gotten into auctions, have been telling everyone else what cars are worth. I think there’s going to be a significant shift, a shift toward people and authenticity.

I think we’re already seeing that shift, a shift to where people — collectors and buyers — will be put back into the driver’s seat and the auctioneers are going to take what I believe is an appropriate role, that of more of a guide rather than telling people what to do, which happens through such things as pre-auction estimated values.

At Worldwide Auctioneers, we have eliminated printed auction estimates. It’s my opinion that the origin of estimates is not what people think it is. Such estimates cause problems, unrealistic expectations. Bidders and buyers should get to decide what something is worth in an auction format.

That’s going to be one of the biggest shifts, power going to the collector and the buyer, and that’s what I think auctions should be. We should be helping and guiding the collector buyers.

I’m a life member of the Auburn Cord Duesenberg Club and there was an article in the monthly newsletter about how the collectors are getting older and asking who is going to take care of these cars? That article was written in the late 1960s!

We also need to remember this is a hobby business. Regardless of how many millions or billions of dollars are transacted in our industry, it’s not like a normal business. This is a hobby. The people stroking the checks — the bidders and the buyers — are going to be increasingly in the driver’s seat.

But what about reserves on cars on offer? I am a huge proponent of no-reserve auctions. If you sell at no reserve in a properly advertised auction, you’re going to do well. I’m not familiar with anyone simply tanking at a no-reserve auction. Our last one set 27 records. Sure, you get a little nervous, but you know what? It works out. The market decides what things are worth.

Right now in the collector car world, on a national or international scale, Rod (Egan, co-founder of Worldwide Auctioneers) and I are the only owner/auctioneers that are out there. We’re in the minority but I think that’s going to change. We see a lot of auction companies getting swallowed up by massive organizations and that overtone of authoritarian process, versus the bidders and buyer sin the driver’s seat, isn’t going to fly.

Authenticity and people is what Millennials look for. Millennials are not just going to influence their decision-making elders and parents. They’re going to be the decision makers, and there are a lot of Millennials. We give them a bad rap, frankly, and while they’re still finding their way as a group, they’re figuring it out pretty quickly. And once they take hold, that’s the new culture, and it’s not going to take 10 years to get there.

There are two components to the demographic shift taking place.

Millennials want to have experiences and there’s not much more exciting that a collector car auction.

No. 1, we’re talking about age. But it’s never really been any different. I’m a life member of the Auburn Cord Duesenberg Club and there was an article in the monthly newsletter about how the collectors are getting older and asking who is going to take care of these cars? That article was written in the late 1960s!

Most people don’t end up with a lot of expendable money until they’re in their 50s, their house is paid for and the kids are through college. Millennials aren’t in that phase yet, but there are some young, hard-core collectors. 

Too often we create barriers to entry. A shout out to the Gilmore museum, which invites younger folks with their cars to have tuner meets at the museum, and BMW meets where the cars are mostly 1975 and newer. 

Young car enthusiasts scrape their pennies together and do some modifications to their daily drivers, for example, a mid-2000s Mustang convertible. But as they get older they will buy something cooler and the pinnacle of collector cars are not supercars form the last 30 years but the pinnacle is the pre- and post-World War 2 classics and sports cars. It’s just like art. You can buy whatever, but eventually you’re going to buy big-time stuff as you can afford it.

Yes, more pedestrian collector cars will decrease in value, but a Model J Duesenberg or a Ferrari California Spider will continue to go up forever because the 25-year-old today who might want to buy a foreign tuner car is going to end up buying those cars someday because they’re the pinnacle for collectors. It’s always been that way and will continue to be that way.

The second part of the demographic shift is that with the digital age and online consumption there’s a craving for instant gratification. That’s true to a degree, but online sales will never ever be a replacement for live auctions. You can’t replicate that. Online auctions are for business transactions, for things you have to have, not things that you want to have. 

I can go online and plan a whole family vacation trip to Disney World, but I can only experience Disney World for real when I’m there. Live collector car auctions are no different than Disney World.

Millennials want to have experiences and there’s not much more exciting that a collector car auction.

Television and the internet have broadened the audience for collector cars, from tens of thousands to tens of millions, and not just in North America but around the globe. Ten years from now we’re going to have much larger global audience and a massive audience here domestically of kids who have been watching auctions all of their lives.

Television and the internet are increasing the collector base, the buyer base. They are increasing demand and those people are going to have expendable income and they’re going to be spend it.

All of these folks my age are starting to jump in and to spend money. We will not just have a thriving collector car market, but it’s going to be wider, broader, deeper, more diverse and significantly bigger than it is right now.