A week ago, a 1987 Ford Sierra broke records by selling for a staggering £596,250 at auction.
Admittedly, this was no normal Ford family car. The engine in question was one of Cosworth’s limited edition 500 Sierra RS500s, which quickly became one of the most collectible vehicles of the eighties era.
However, the winning bid at the Silverstone Auctions Race Retro sale at Stoneleigh Park in Warwickshire on Saturday plunged the room into stunned silence, with the low-mileage car wiping out four times the previous world record price paid for one of these models.
But what caused this, and how common is it for bidders to significantly exceed indicative pre-sale prices?
One man who knows is John Mayhead, editor of the Hagerty Price Guide. It’s his job to know the value of classic and collectible vehicles. And he says the Sierra sold last week – like so many before it – is what the industry calls an “outlier”.
In a special guest post for This is Money, John explains what that means.
This immaculate low-mileage 1987 Ford Sierra Cosworth RS500 sold at auction last week for a staggering £596,250, four times the previous record for a car of its ilk. John Mayhead explains why this happened and explains why “outliers” sometimes occur
Superb low-mileage Cossie sold last weekend for nine times its original inflation-adjusted price – an 856% increase in just over three-and-a-half decades
Last weekend I saw a 1987 Ford Sierra RS500 Cosworth exceed its highest estimate at the Silverstone Auctions Race Retro sale and keep going.
The previous record for a road-going Sierra was quickly eclipsed, followed by the British Touring Car Championship race car record on which the RS500 was based.
The bidding stopped at around £300,000 and I thought it was over, but then it picked up again and the hammer eventually fell to £530,000 (almost £600,000 when the buyer’s premium was added ).
John Mayhead, editor of the Hagerty Price Guide
I was amazed at the price, but not that a car sold with such a huge margin above what was expected.
I’ve followed classic car auctions for years and seen it all before; this is what our valuation team at Hagerty calls an ‘outlier’, cars that sell for far more than is truly rational, would probably not be worth as much if resold tomorrow, and will not be reflected in our Hagerty Price Guide values.
That day, the planets aligned and the price kept rising: two people decided to drive home with this car, regardless of the cost.
Why “outliers” occur
There are many reasons why outliers occur, and I’m going to have to step away from my usual job of looking at trends in data and turn to amateur psychology to explain a few of them.
Sometimes it’s just good old human competition.
A few years ago I was at a big auction in London when a very nice Porsche came up for sale and two men, both in the room, started bidding against each other.
Neither would back down and until the price, more than double the highest estimate, got too high for either of them and they pulled out.
The winning bidder later explained that he had just sold his business, so money was not an issue as he really liked the color.
He paid £1million above the car’s highest estimate.
“Good old-fashioned human competition” is one of the reasons why outliers occur in car auction rooms, but there are other factors at play to consider.
Then there are the “once in a lifetime” cars that may have ultra-low mileage, are in almost unbelievable original condition, or have belonged to someone very special.
Last year, a Ford Escort that first belonged to Princess Diana went on sale.
The auction house raved about the unique opportunity to own this piece of history and two bidders decided they had to have it.
It eventually sold for £722,500, making it the second most expensive Ford ever sold in the UK at public auction after an original GT40 race car.
Was last week’s Sierra Cosworth RS500 the ultimate outlier?
When new in 1987, the Ford Sierra Cosworth RS500 homologation special had a list price of £19,950.
This means that last weekend’s winning bid of £596,250 has seen its value rise by a barely believable 2,889% in 36 years.
Taking historical inflation into account, that 1987 list price translates to £62,360 in today’s money, as shown by our historical inflation calculator.
That means this superb, low-mileage Cossie has sold for nine times its original inflation-adjusted price, an 856% increase in value in just over three and a half decades.
Before the hammer fell on Saturday, the previous world record amount paid for a Cosworth Sierra at auction was a non-RS500 model with 9,000 miles on the odometer, which changed hands for £132,750, also at auction from Silverstone last year.
The previous highest known price paid on the block for one of the rarest RS500 cars – of which only 500 have been made – is £122,400 in 2017.
> Read the full report on the Sierra Cosworth RS500 record holder
Finally, there are shoppers who think they’ve seen something others may have missed.
There were two excellent examples at last September’s Bonhams sale at the Goodwood Revival, both with McLaren heritage but both very different cars.
The first was nothing more than a bunch of twisted bits that started life as a 1961 Cooper-Climax F1 race car, then was reincarnated, modified and finally left to rot in a barn in South America. .
But the car had been the first to wear the McLaren Racing Team badge and was driven by Bruce McLaren himself.
Bidding went wild and it eventually sold for £911,000, with the buyer seeing the opportunity to recreate a motoring legend and almost certainly get it back on track.
In the same sale was a 2009 Mercedes-Benz McLaren SLR 722 S roadster with a stunning color combination and a top estimate of £320,000.
The SLR is a car that Hagerty has pointed to as a future collector’s item, and it seems others agree: Bidding went wild and the car sold for £687,000, with the buyer obviously believing that he was ahead of the game and spotted a car that in the future will be worth much more than he paid for.
So far it is on the right track: the Hagerty price guide values for the model have already started to climb.
Auction houses and dealers obviously encourage this, as any good seller would.
Unique offers, buy it now or maybe it’s gone, think how bad you’ll feel ten years from now if the price is now out of your reach… all of this is very much in most sales, and the drink often flows freely too.
But ‘outlier’ sales don’t just happen at big flashy international auctions.
Of the thousands of lots Hagerty tracked in the UK and Europe from 2020 to the end of 2022, the car that sold for the highest percentage of its highest presale estimate was a Mercedes station wagon- 1987 Benz 290TE, sold by Brightwells in December 2021 for an astonishing £20,720, 341% more than the £5,000 that was expected.
Six of the cars in this top ten were sold by Poole-based auctioneers SWVA, including a 1933 Triumph Stag, Morris Minor and Austin Six Westminster which fetched £25,110 from an expected price of just £6,500 . It also suggests that the SWVA team is excellent at setting truly tempting low estimates that attract buyers.
Notice that the best reason to spend more than others may think is wise on a car is because you love it.
At the end of the auction, no matter how much someone pays for a car, if they go home with a big smile on their face and their stomach flutters every time he drives it, as long as he bought within his means, they probably made the right choice.
Some links in this article may be affiliate links. If you click on it, we may earn a small commission. This helps us fund This Is Money and keep it free to use. We do not write articles to promote products. We do not allow any business relationship to affect our editorial independence.
