Yahoo Finance's Pras Subramanian details the record price a rare Mercedes was just auctioned for, in addition to the outlook of luxury car manufacturers and car collectors.
SEANA SMITH: Most expensive car ever sold on record, a rare 1955 Mercedes-Benz 300 SLR-- you're looking at it right now-- Coupe sold at Sotheby's for-- get this-- $142 million. Putting this all in perspective, that's nearly three times more than the previous record. We want to bring in our senior auto reporter, Pras Subramanian.
And, Pras, is there anything more to this? I mean, are these just car lovers who have a lot of money and they're looking to buy cars? Or is it actually a hedge against inflation? What do you think?
PRAS SUBRAMANIAN: [LAUGHS] I think this sale caught a lot of people by surprise because it just blew away that second-place car. And this car had some unique things going on for it. It was only one of two ever made. Mercedes made this car as, like, a test car. They never wanted to sell it. They had both these cars in their private collection, and they were convinced to sell by a private sort of dealer.
They got this huge amount for it, $143 million. That money's gonna towards a scholarship fund the company has. But it just kind of goes to show you how these rare cars are still getting people excited.
- It reminds me of Ferris Bueller, for those of you that are old enough. You know, Cameron's dad's car, and--
SEANA SMITH: I've actually seen that.
- --all right!
SEANA SMITH: I know.
- There we go.
SEANA SMITH: It took a while. We got there, though.
- Has it ever been driven? I have another question for you, but it has ever been driven and will it ever be driven? Or is it just literally a museum piece?
PRAS SUBRAMANIAN: Mercedes said that a lot of their test drivers and engineers have driven it in the past to kind of benchmark it against other supercars back in those days. So I think the person who buys it, hopefully, will buy it to drive because it is apparently an amazing car. So but going back to the big market, you see Ferrari dominates, right? Like you mentioned the Bueller car. And the top four of the top five are all Ferraris until this Mercedes came along and blew it away.
- Blew it away. And apparently, they're going to make it available for public-- for the public to see on occasion. But I'm looking at this list of things that are selling off the charts. Andy Warhol's "Marilyn" went for $195 million. That smashed a record. Sotheby's Macklowe Collection-- I don't even know if I said it right-- $922 million in art. Sotheby's, Christie's, and Phillips, in a couple of weeks, $2.5 billion at auctions.
Seana said it earlier. Is this about a hedge for inflation? Or is this just the rich are getting a lot richer, and they got nowhere to put their money that's a safe haven?
PRAS SUBRAMANIAN: You know, it could be both because you're talking about a real true, real hard asset, right? A car, a valuable, limited-edition car. It has some value, $140 million in one story. But it's limited, and it has some cachet. And inflation, 8%-- maybe this is a place to park some of your cash, maybe 10% if you're a billionaire like some people that we report on on this show. So maybe that is a part of that equation as to why you buy it.
SEANA SMITH: You know, what's interesting-- and you wrote about this earlier this week, just Mercedes pivoting even harder towards these top-end cars. I mean, when you think of Mercedes, at least I do, I think of a luxury car. I think of a top-end car. Are they going even more extreme? Are they catering to the ultra-wealthy now?
PRAS SUBRAMANIAN: They've been recently releasing cars that rival Bentleys in terms of price, right? So they're kind of pushing towards that top end that they're calling it. And maybe this is a reflection of their brand pivot where these cars, these rare cars, are going for even more money. We'll see what happens in Pebble Beach in August when a lot of these cars go on auction.
RACHELLE AKUFFO: And, Pras, do you think this is something of a backlash to some of these NFTs and Metaverse purchases that people are making, that people are willing to spend this much money on a car? And Mercedes really upping their game here with even more expensive cars now.
PRAS SUBRAMANIAN: You know, Rachelle, real quick. I had a trader friend that lost a lot of money in the 2000 dot-com bubble bust. And he said, you know what?
If I had bought a Ferrari, at least the Ferrari'd still be in the street. I'd still have it, right? Not my money that kind of vaporized out of nowhere like an NFT. So I think there is a little bit of that. Why not buy a hard asset like a car that you can actually have? And if your stock market goes to zero, at least you get a Ferrari.
SEANA SMITH: Yeah, that's not a bad deal.
- Yeah, NFTs are down 80% from their peak.
SEANA SMITH: Yeah.
- Wiped out.
SEANA SMITH: All right. Pras, thanks so much. I think I have enough money to buy like a piece of a tire of that car. But we'll see. Maybe we'll get there one day. Pras Subramanian, thanks so much. Have a good weekend.