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"Motor Cars By Public Tender": Australian For "Auto Auction"

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On: Fri, Oct 7, 2011 at 9:15AM | By: Andrew W Davis

"Motor Cars By Public Tender": Australian For "Auto Auction"

Though seemingly tame at first blush compared to the live “under-the-lights” pressure-cooker-style of auction most of us are used to, in many ways a sale "by public tender”—like Sotheby’s Australia’s “Important Collectors’ Motor Cars” event in Sydney—can be even more nerve-racking for buyer and seller alike.

Normally—if that’s even the right word to use—it’s pretty straight-forward. If you just keep on bidding until everyone else quits, the car—or whatever—is yours.

But where’s the mystery—and gentility—in that?...

I have to admit up front that I wasn’t versed in the ways of a public tender sale before I engaged in some serious explanatory back-and-forth with James Nicholls, Sotheby’s Australia’s Head of Collectors’ Cars.

Part of the reason for that exchange was that I couldn’t believe that what I was hearing was what I was hearing. The format is beautifully—and brutally—simple: You check out the merchandise in "catalogue" form and/or in person at several preview days, then you write down the maximum amount you’re willing to pay and turn it in and wait.

Simple, right?

Well, consider this: your bid is what it is and cannot change. So long as at least one bid exceeds the seller's "reserve" price on the car, the fact that you were just a dollar short “winning” the car—a dollar you'd have gladly added—that’s too bad for you.

And on the other end, instead of having a system like eBay’s—wherein you set your maximum amount and it adds to your bid only the amount necessary to keep you “ahead” of any competing buyer’s bid—here your "winning" top price is THE price, even if the next-highest bidder’s amount was thousands less than yours.

It’s like a high-dollar game of “chicken” wherein everyone is wearing blindfolds and there are dozens of cars out there going at each other from all different directions (but more refined, in an upper-crusty sort of way).

Whether or not this “one bite at the cherry” system means more dollars in a seller’s pocket is debatable, but well-established auction houses like Sotheby’s Australia wouldn’t do it this way if it didn’t work in favor of buyer and seller alike. And as this is a customer-service deal like most others, ALL auction houses and styles—or at least every one I've ever heard of—treat the "unsuccessful" end of "formal" bidding as the starting point for tireless negotiation on their part to eventually bring buyers and sellers together whenever possible.

[A sale's a sale, folks, and auction houses make their money on SELLING things, not just SHOWING them to bidders.]

This particular sale—Sotheby’s Australia’s “Important Collectors’ Motor Cars” event in Sydney, NSW—for example, has in-person preview days from Thurs. Oct. 13 to Sat. Oct. 15, with all bids “due” by noon local time on Monday the 17th. Fortunately for the weak-of-heart (or -stomach), the bids “tendered” are tallied—and “winners” are notified—by that same afternoon.

So, which “style” would you prefer? I’ve spent far too many hours in the circus-like atmosphere endemic of many live auctions, as alcohol from the “bidder’s bar,” the potential to be shown bidding during prime-time television coverage, and the overabundance of ego and sheer “gotta have it” that can exist between competing moneyed men (and women) conspire to drive bid prices into the stratosphere.

But to have the process distilled down to some envelopes being turned in, bids tallied, and high-bidders notified in short order is disorienting in its own way.

My view? On the face of it, I think I’d take all the “circus” I could get, whether as a buyer or a seller. There’s something to be said for the bid-raising power of frenzied (and inebriated) competition. There’s value, too, in having the ability to fine-tune your bid on-the-fly on your way to an immediate-gratification-style “win”.

Then again, I’d venture to guess that if I had the gentility—and wealth—that’s surely common in Sotheby’s clientele, I’m sure I’d be horrified at the cattle-call atmosphere common to most live car auctions, and would never even consider setting foot in any of those roaring-loud tent-based events where chances are good that you’ll get cheap beer spilled on your expensive clothing by persons as sweaty and uncouth as they are boorish and overweight.

What could be more refined than using your Mont Blanc fountain pen to write your maximum bid on fine linen stationery, carefully folding it into a foil-lined envelope, submitting it by courier to the auction house, and then waiting in quiet comfort wherever you choose to receive word of your intended's selling price?

[Of course, there’s always something to be said about a live auction’s having all the cheap beer, sugary churros, and salty, oversized soft pretzels you could want within easy reach. Then again, if you’re wealthy enough, you could always arrange to have that in-house….]


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