<VV> vehicle values, Corvair or otherwise

[Marc Marcoulides]

a good example of the fact that an auctions purpose is to maximize the excitement for the sale of anything




-----Original Message-----
>From: "Steven J. Serenska via VirtualVairs" <virtualvairs at corvair.org>
>Sent: Jan 16, 2019 9:46 AM
>To: virtualvairs at corvair.org
>Subject: Re: <VV> vehicle values, Corvair or otherwise
>
>VVers:
>
>I shared the results of the Mecum auction with a few friends who are car 
>guys, although not Corvair guys.  One of them is a former judge from 
>Texas who is now a professor at a law school here in my town in Rhode 
>Island.  I thought his response was pretty well written and educational:
>
>
>[In the judge's words:]
>
>Having been to Barret Jackson many times, I can say that many of the 
>cars do sell for incredibly high prices; sometimes, it's the result of a 
>buyer and seller "negotiating" an auction environment.  At other times, 
>with booze and big egos the prices rise. I would never call the "auction 
>price" a FMV. The prices are manufactured by the environment and the 
>auction house's manipulations. One could argue, however, those are still 
>FMV because someone bought and someone sold.
>
>One example that I was personally involved in had to do with my 1929 
>Stutz LeBaron Speedster. I sat in front of the auction stand. The tent 
>was packed. It was morning, but I know the booze was flowing. My 
>"reserve" price was $165,000. Out of that, I'd pay the auction house 8% 
>and net the rest sans the expenses of having taken the car to Scottsdale 
>from San Antonio. It was supposed to be a good "environment" for the 
>classics.
>
>The car sat on a turntable, with lights beaming off the concours-winning 
>black paint with red pinstripe. The massive polished alumninum wheels 
>shined like the sun.
>
>The bidding was fast and furious. "I have 130...and now 135 over 
>there....now 142...now 145...there's a new bidder with 150.......the 
>auctioneer was pointing left, then right, right again, then left. Other 
>auction staff, in the tent, would yell, "yes" and the auction price 
>would increase by 5,000.
>
>The price stalled at around 150,000. A staffer came over to me and asked 
>what I wanted to do. I said, "well, close out the auction and say the 
>reserve was not met." He said, "do you want us to run it up to your 
>reserve?" That, of course, would leave the unwitting audience thinking 
>someone had bid the reserve and I chose not to sell at that price. 
>(Remember, no one, but the auctioneer and seller know the reserve price).
>
>As the staffer, with whom I had just spoken, approached the head 
>auctioneer on the microphone, someone in the audience yelled "155." OMG, 
>I thought, the bidding was starting again. The auctioneer was 
>reenergized and began calling out bids from left and right in nearly 
>staccato fashion. It quickly ran past my reserve and the car was 
>declared sold.
>
>After the auction session, I was in the auction office and was told that 
>there were no bids, at all.....except one lonely bidder who started at 
>155 with that yell-out. He was the only bidder in the entire tent. And, 
>all the auctioneer call-outs were shills.
>
>Can we, then, call the selling price FMV? Arguably, yes. But, would you, 
>as a buyer, want to use that as criteria to determine the value of a car 
>you're buying? Arguably, no.
>
>[end of judge's words]
>
>
>Steven J. Serenska
>Bristol, RI
>
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