Volume II, Issue 2, Page 8

2/15/2007

Tax Time

At the start of every New Year everyone is relaxing from the holidays and also gearing up for April 15 -- TAX TIME!  For me, I am preparing as I do every year for Barrett-Jackson. 

Some believe this auction is famous for setting the price for the year on the value of muscle cars, customs, hot rods, and everything else that has to do our multi-billion dollar industry.  There are shops out there that build cars all year long just for the sole purpose of going to Barrett Jackson…..those potential sales are a huge part of their business. 

The Barrett-Jackson Auction not only sets the price for the year -- and can make or break a seller -- it also is a business, which nets millions of dollars to those running the auction block.  With a stiff combined 16-percent fee derived from the seller and the buyer as a commission B-J does very well!  Add in entry fees and miscellaneous vendor receipts (plus a premium for sellers to get their vehicle on the block during prime time) and it’s easy to see who’s getting rich(er). Barrett-Jackson is taken so serious that price guide publications such as CPI and NADA use their sales as statistics for their books.  And of course there is a trade off; all auctions are at no reserve!  Feel like rolling the dice on your muscle car?  It is a risk to auction your car at Barrett-Jackson, no question. 

But every year sellers are turned away because of space limitations.  So I guess there are enough people out there willing to take the huge risk, and I am one of them.  This year we had five cars rolling through the auction block.  People tell me it only takes one person to want your car at Barrett-Jackson.  That can’t be further from the truth it, it takes at least two people to really want your car and they have to want it pretty bad.  Well I should backup a little, first you have to have a desirable car and right now muscle car prices are soaring.  Additionally, it helps if your car is in original condition or restored to original condition and lastly it has to be sought after and hopefully you purchased the car or built the car for good price and have enough room to make money.  

The last thing I will say on Barrett Jackson is that bidding on cars changes people.  What I mean is that at times it becomes like sharks feasting and that can artificially drive up the price to more than what the car is really worth.  As for my time there this year.  Well, let’s just say that I broke even.  For gambling that’s not all that bad.  Of course, there were people who made out.  But no matter what, Barrett-Jackson filled up their coffers once again.  Who knows, only time will tell what next year will bring.  And whether I’ll be back or not. 

 

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