Another One Bites the Dust
Hi Friends!
This week it was announced that Gooding & Co. has been acquired by Christie’s and their parent company Groupe Artemis. Although rumored to be the highest sum paid for anything by Christie’s in over two decades, exact prices and terms were not disclosed. The sale should be finalized by the end of 2024, at which point the California auction company will be known as Gooding Christie’s.
First off, I have a tremendous amount of respect for the Staff and Principals at Gooding & Co. I’ve always found them to be extremely ethical, sensitive to the health of the marketplace above and beyond many of their counterparts, and I also really enjoy their events. Their presentation and branding are impeccable and of course
lead auctioneer, Mr. Charlie Ross is an undoubted international treasure.
This said, this is an equally sad moment in the history of this industry. Aside from Mecum, Gooding and Co. really represented the last stand of the independent in the classic and collector auction space at the top level and for a business that has largely been an aspirational safe haven for entrepreneurs, this marks the end of something significant.
For those not keeping score, here’s who owns what and the timeline of when they got it:
RM Auctions – purchased in 2015 by Sotheby’s/BidFair
Bonhams – purchased in 2018 by Epiris
Bring-a-Trailer – purchased in 2020 by Hearst
Broad Arrow Group/Broad Arrow Auctions – purchased in 2022 by Hagerty
Barrett-Jackson/AutoHunter Auctions/ClassicCars com – purchased in 2022 by IMG/Endeavor
Gooding & Co. – purchased 2024 by Christie’s/Groupe Artemis
To be fair, there are examples out there of big conglomerates operating successfully in this space. I think Sotheby’s partnership with RM Auctions has been proven to be more positive than not. Together they have been able to expand the marketplace, increase events in ways that make sense and overall improve the landscape for the broader majority of enthusiasts and business people alike here.
We’ve also seen several examples of the opposite being true and real sustained injury being caused to this industry as a result. Ritchie Bros’ purchase of the now defunct Leake Auctions in 2018 was a point-by-point road map of what not to do in this space and the damage caused by their short run is still being felt, most notably in places like Arizona in January. Their run in this space was highly problematic for everyone involved and portions of the landscape have never fully recovered.
Christie’s has been here before and they definitely have historically fallen into the latter category. For those who may not remember, Christie’s had a collector car division and closed it in 2007 after a series of pretty significant miscalculations contributed to a disastrous Retromobile sale. This acted as the proverbial straw that broke the camel’s back for them, as they exited shortly after.
Best case scenario, this acquisition is treated the way that Sotheby’s has treated RM so far: Allowing the team at Gooding to keep doing what the team at Gooding does so well and largely keeping their hands out day-to-day operations.
Worst case scenario, Christie’s follows the bean counter route, analyzes everything on spreadsheets and nothing in reality and constantly finds ways to get into the current staff and principal’s way. This is generally where we see problems as an outside observer in situations like this. Too much micromanagement leads to slow execution, which leads to missed opportunities, which leads to strangled budgets, which leads to desperate decision making, which leads to bad things for everybody overall. I don’t think anybody wants that here.
From our perspective (and that of many others that we deal with), the major collector car auctions are the top of the pyramid for which everything slides downhill. It has been stated here repeatedly (and by basically everyone else), we are in the midst of a generational shift and part of that generational shift means people that have done well have the opportunity to cash out and then go and enjoy their accomplishments. That’s the natural progression and it’s part of the way things move. However, when you get huge conglomerates and investment firms involved at structural levels like this, it makes it very hard to maintain the traditions and procedures which have allowed this business to get where it is in the first place, to be passed down and preserved for the future.
Now, nobody is saying anybody owes anybody anything between generations here, but the (at least semi) level playing field that has been afforded to incoming generations in the past has now effectively been sold away. Where that leaves the future of this industry is tough to say. We’re just going to have to sit back and wait and watch and see how these conglomerates/investment firms proceed (and probably more importantly, what the effect of how they interact with each other is going to have on everyone else – we already know it hasn’t been particularly positive in Florida).
A quote that I got from one of our longtime clients shortly after this news broke sums it up pretty well:
“This business is no longer about passion for a hobby.”
That’s it for this week…
Darin Roberge