Tastes are finicky. I think that for classic car values to remain high or to appreciate in the long term, future generations must be interested in cars as much as past generations have been. I certainly don't think that all interest in automobiles will disappear in future generations, though there's been a lot of talk of how younger folks today are way less interested in cars as a hobby.
This is an interesting point and can is definitely within the realm of possibility. I can't help but think of the following analogy though, going to the previous personal transportation epoch; how often do you see people showing up to a party by horse drawn carriages now? It would certainly be a conversation starter, but how many people do you know that would genuinely see arriving that way as a sort of status symbol?
I can see a world where some old classic cars are treated, enjoyed and admired as sculptures; and are not to driven or used or ever moved under its own power. At that point, the car would be nothing more than another form of fine art.
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Another reason I think that is fueling the recent jumps in valuation for so many cars is the ton of cheap money and low interest rate environment. People that can and do use cars as investments have money sitting around, and rather than putting it in a bank account and losing to inflation, they are putting investing it into vehicles with hopes that the trend continues and valuations keep going up and up.
I agree that the true blue chips at the ultra high end of the market, the 250 GTO, Pre-War Bugattis, McLaren F1, and the likes, is unlikely to see any significant drop in values just because there are so few of them and they have transcended beyond their purpose as cars to art, pure hard asset investment or objects of desire and envy. What's interesting to me is what will happen to the long term value of all the classic cars that are a tier below (say the ones that are between $100k and $2 million dollars), or even the level below (the "attainable" level where prices are under $100k)? There's a lot bigger supply of those cars than the blue chip world.
It's interesting to think about and somewhat unprecedented (dubious, citation needed) as an asset class in general. I'd argue that cars didn't even become assets or viewed as assets until...maybe the late 1970s to mid 1980s? I mean a 250 GTO sold for $2,500 (~17k in 2020 USD) in 1969 back when they were just "used race car". I don't have any secondary confirming sources, but apparently chassis #4487 Bugatti Type 35
sold for $1750 in 1962 ($13k in 2020 USD) - firmly after the myth and legend of Bugatti had already been established. This suggests they were seen as collector items but not so much financial assets in the past. So, for some reason, in the early 1980s cars started to become seen as an asset class where apparently they hadn't really before. The older boomers started to reach executive levels during this time period and I'd suggest this coincides pretty nicely with the feds initiation of the easing/low interest rate policy - lots of liquidity and nowhere yieldy enough to park the cash.
Just cross reference this list...
1962 18,500 Sold Selling price from factory when new[7][8][36]
1965 4,000 Sold 3851GT Purchased from Ernesto Prinoth by Fabrizio Violati.[37][38]
1965 10,500 Sold [citation needed]
1966 7,000 Sold 3647GT Purchased by James McNeil from Robert Sauers in Springfield, Massachusetts, USA.[39]
1968 6,500 Advertised June 15th, a 1962 example was advertised in Autoweek[citation needed]
1969 2,500 Sold 3223GT
1969 5,400 Sold 3387GT Purchased by Kirk F. White of Pennsylvania, USA.[40]
1970 8,500 Advertised 4757GT Advertised in the LA Times[citation needed]
1970 7,780 Advertised
1971 9,500 Advertised Advertised by Algar Ferrari in Autoweek[citation needed]
1971 9,900 Advertised Advertised in Road & Track[citation needed]
1971 6,000 Sold 3589GT
1971 12,000 Advertised Advertised by KFW Motorcars in Paoli, PA.[citation needed]
1973 17,500 Sold [citation needed]
1974 28,000 Sold [citation needed]
1975 13,000 Sold 3387GT
1975 35,000 Sold 3223GT [citation needed]
1975 48,000 Advertised Advertised in Autoweek & Competition Press.[citation needed]
1977 71,000 Sold Purchased by Pink Floyd drummer Nick Mason with proceeds from the album Dark Side Of The Moon.[42]
1978 90,000 Sold 3987GT Car in good original condition.[citation needed]
1978 125,000 Sold 3387GT Purchased by Mark De Friece.[40] Car in perfect Concours-ready condition.[citation needed]
1980 190,000 Advertised 3445GT Asking price following restoration.[citation needed]
1981 285,000 Advertised 4091GT Advertised in various publications.[citation needed]
1982 345,000 Sold 4757GT Purchased by Christopher Murray of Rhode Island, USA[43] Price quoted as either $250,000 or $345,000.[44]
1983 300,000 Sold [citation needed]
1984 500,000 Sold [citation needed]
1985 650,000 Sold 3987GT Purchased by Ralph Lauren.[45]
1986 1,000,000 Sold 3589GT [citation needed]
1987 1,600,000 Sold 4757GT Sold at FBI Auction[44] and subsequently entered collection of Jacques Swaters.[43]
1988 4,200,000 Sold 3589GT Purchased by Engelbert Stieger of Teufen, Switzerland[41]
1989 10,000,000 Sold [citation needed]
1989 13,300,000 Sold 3909GT Sold to Takeo Kato of Japan.[46]
1990 13,000,000 Sold [citation needed]
1993 3,250,000 Sold 4219GT [47]
1994 3,500,000 Sold 3909GT Sold to David Morisson of London[46]
1996 3,500,000 Sold 5905GT Sold to Lee Kun-Hee of Seoul, South Korea.[48]
1996 3,500,000 Advertised 3445GT Advertised by SMC of La Jolla, California, USA.[49]
1997 2,200,000 Sold [citation needed]
1998 6,000,000 Sold 3729GT [citation needed]
2000 7,000,000 Sold 3413GT Purchased by Greg Whitten.[50]
2004 10,600,000 Sold 3223GT [51]
2007 22,000,000 Sold 5905GT Sold to William Ainscough of the UK.[52][53]
2008 22,763,611 Sold 5905GT Sold to Jon Hunt of London, UK.[54] [53]
2010 26,000,000 Sold 3943GT [55]
2010 17,700,000 Sold 4675GT
2012 31,700,000 Sold 5905GT Believed to be the largest single car transaction in the U.K. at the time.[53]
2012 35,000,000 Sold 3505GT Sold to Craig McCaw of Washington, USA in a private sale.[9][58][59]
2013 52,000,000 Sold 5111GT Sold to an unknown buyer by Paul Pappalardo in a private sale.[12][60][61]
2014 38,115,000 Sold 3851GT Sold by the Fabrizio Violati estate at Bonham's 2014 Quail Lodge auction in Carmel, California, USA.[62]
2016 56,800,000 Advertised 3387GT Advertised by Talacrest UK.[63]
2017 44,000,000 Sold 3387GT Sold by Bernard Carl in private sale to Gregor Fisken.[64][65]
2018 70,000,000 Sold 4153GT
2018 48,405,000 Sold 3413GT Sold by Greg Whitten at RM Sotheby's 2018 Monterey auction.[26]
...with this chart (fed funds rate). It's hard not to see dramatic changes in one echoed in the other.
Is my thesis then that classic car values are still stuck in a bubble that started inflating in the early 1980s? (an a Not really? But I still see automobiles as a highly 20th century interest. It would be stupid to say that
nobody is going to want the classics in the future, but I also don't see such a wide swath of the population keenly interested in spending hundreds of thousands of dollars on cars (especially not ones without a nostalgic connection) as they do now. There is so much uncertainty at the moment (just look at that interest rate graph, what happens
next if you try to interpret what happened in the past?!) so I think it's impossible to predict, but my broader point is that I think its unwise to dismiss the possibility that classic/vintage car prices could collapse if the enthusiasm for them that has inflated their stature as an asset class runs out.
