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Fast money, fancy cars: How one Ontario drop-out made it big
Rob Myers became the king of the luxury exotic-car business through “relentless professionalism”
August 9, 2014
Tim Scott/RM Auctions
Rob Myers has what he calls “a bad-looking resumé”—he dropped out of high school in Grade 10, has never worked for anyone and, by his own reckoning, has never had a job. Yet, in 35 years, he’s created the biggest fine-automobile auction house in the world, RM Auctions Inc., with annual sales of $500 million. “They’re the San Antonio Spurs of the old-car world,” says Chris Bietzk, auction editor of London-based Octane, one of the leading classic-car magazines. “Their reputation is one of fabulous, relentless professionalism.”
The auctions take place around the world, but the entire operation is headquartered in Myers’s hometown, Chatham, Ont., nestled in an agricultural area within the auto belt of southern Ontario. International collectors snap up its offerings, which range from early masterpieces, such as a 1911 Mercedes, to more modern vehicles, such as a 1970 Cadillac Deville. The crème de la crème of its exotic cars, sold in posh locales such as Monaco, Monterey, Calif., and London, can command prices in the stratosphere. Currently, RM holds five of the top 10 records for prices of cars sold at auction, including the 1967 Ferrari N.A.R.T. Spider sold last year in Monterey to Canadian billionaire Lawrence Stroll for US$27.5 million. That auction was the largest of all time, with total sales topping US$125 million. This year’s offerings include a 1967 Ferrari 275 GTB ordered by actor Steve McQueen and delivered to the set of Bullitt with custom changes, including a chianti-red paint job. It’s expected to push past US$10 million.
Miles Nadal, CEO of New York City-headquartered MDC Partners, has bought about 20 cars through RM, including James Bond’s favourite: a 1965 Aston Martin DB5. Three years ago, his lifelong passion for cars tipped into something a lot more serious when he visited the legendary collections of Ralph Lauren and Jay Leno. “You enter a different zip code and universe of collecting,” he recalls. “Once you get the bug, it’s insatiable.” With eclectic tastes and the bank account to fill garages, he started buying, accumulating 80 to 90 cars, such as a Bugatti Veyron and a 1955 Mercedes 300SL gullwing, similar to one Pierre Trudeau owned. Asked how much he’s spent to date, Nadal pauses, laughs, then says, “I refuse to count, otherwise it will compromise my relationship with my wife and family, because they see their inheritance is being dissipated at a rapid clip.”
Myers, the man who gives RM Auctions its name, got his interest in cars from his father, a factory maintenance man who fixed up cars as a hobby. At 16, he was given a 1959 Edsel to restore in the family garage. He did, then drove it to high school—and traded it for a Triumph motorcycle. Soon, friends were asking for restorations and custom paint jobs. In 1979, he opened a 3,000-sq.-foot car restoration shop in Chatham, Ont. In the 1980s, as his business grew, Myers, a natural wheeler and dealer, was buying and selling cars at auction, through, among others, Kruse International, then one of the largest antique auction houses on the continent. “I can do things better than these people,” he remembers thinking. In 1991, he bought an auction firm in Toronto and RM Auctions was born.
The firm’s focus has always been collectables, and it’s now famous for European exotics and early cars. “Back then, they all had character and style of their own,” Myers says. “I couldn’t tell you about a new car these days. Take all the badges off the cars, and people have a hard time identifying them.”
Beyond its size, what gives RM an edge over its competitors is that it’s the only one with an in-house restoration facility. At the Pebble Beach Concours d’Elegance, a show where the most highly strung automotive thoroughbreds are pranced and preened as they vie for prizes, RM Auto Restoration dominates the field. Its restorations have won best of show five times in the new millennium, including a 1931 Daimler Double Six 50 sport roadster, which scooped up the top prize in 2006 after RM fixed a design flaw that made the prototype overheat.
While some jobs are simple—they’ll do oil changes and brake jobs—others can be ground-up restorations that take upward of two years, with price tags that reach into seven digits. The process is exacting. RM’s craftsmen start by checking a car’s provenance and features. Fine cars built before the 1940s were often customized for the buyer. “You bought the chassis and the drive train from a manufacturer, such as Duisenberg,” general manager Mario Van Raay explains. “From there, you would order the body to be put on the car.” That included the hood design and the shape of the fenders. RM’s technicians disassemble the car, documenting each piece, to determine if it’s authentic for the vehicle. “A lot of the cars we’re working on have been played around with quite a bit in their lives, so there are parts that could be incorrect, and that gets right down to incorrect screws,” Van Raay explains. The correct components are found, bought or manufactured. No detail is too small, including the imprint of the grain on the leather interior. Then the team has to get it working again. RM is known for going to extraordinary lengths to bring a car back to life. In 2010, when charged with restoring a 1934 speedster built by Edsel Ford, it tracked down the original cracked engine block at a Florida garage, repaired it and put it back in the car.
At the end, the owner gets the car, as well as the documentation of the restoration and the original parts. (That provenance and record-keeping is essential these days; scam artists are known to fake parts and even age frames to pass them off as the real deal. Myers has seen it happen. “I have a team of researchers,” he explains. “All they do is research a car to death. We have to know it’s the genuine article.”
At any time, there are between 40 and 50 cars being worked on; this spring they were juggling seven full restorations. While the cars come from around the world, virtually all of RM Auto Restoration’s 27 full-time employees are local. Many are self-taught, Van Raay says, and a good number have worked there for more than 25 years. Don McLellan is one of those quarter-century folks. As the quality-control manager, he gets one of the best jobs: testing the cars on the area’s country roads. “I drive them usually harder than the clients will, making sure they won’t get leaks or noises or vibrations,” he explains. While little kids wave, others find it annoying to be stuck behind a 1920s roadster. It may look cool, but it doesn’t exactly hit today’s speed limit.
The old cars may be a little slow, but their values have been burning rubber. The Historic Automobile Group Index, which tracks collector car prices, is up nearly 150 per cent since the 2008 recession, which sent values reeling. For Miles Nadal, “Automobiles are the best alternative asset class in the world. I’d say the portfolio of investments I’ve made in high-end classic cars has appreciated faster than any other asset class I’m invested in.” His Ferrari values have gone up at a compounded rate of 25 to 30 per cent in the past three years. “Fortuitously, or serendipitously, it’s a good time to invest.” In recent months, those enormous gains have started to tail off, reports Octane’s Bietzk, as savvy investors realize some prices are so high that profits are being squeezed. Bargains can still be had, he suggests, in very old cars from the beginning of the previous century, favoured by enthusiasts more than investors.
RM sells to collectors around the world, including a doctor in India who’s got more than 500 vehicles: “Really good cars,” Myers notes. In 2013, its bidders were from 52 nations. Most are Baby Boomers; virtually all are men. Recently, Myers has seen a new crowd get in on the action: Generation X, who are picking up cars they admired when they were children, such as the Magnum P.I. Ferrari. The new blood keeps the business booming. And RM makes money on both ends of the deal. Myers says the buyer’s fee is, in general, 10 to 12 per cent to RM, while RM often also takes a commission from the seller of around six per cent.
Beyond generalities, there’s no typical buyer, says Gord Duff, one of RM Auctions’ car specialists. Some have a handful of cars, others a few hundred. Wherever Miles Nadal travels, he tries to meet fellow collectors. “It’s fascinating what people have assembled,” he says. “You meet so many people who have such diverse interests; some people collect only early French cars, muscle cars, woodies, Corvettes, Porsches.”
Duff’s job is to find product to consign to RM’s auctions, then find buyers interested in the cars being sold. He spends a lot of time on the road, visiting clients and seeing what’s in their garages. He says some just drive their gems on and off show fields. Others take them out for rain-free Sunday drives, while some love to race them and, “if they run into some rain or a stone chip, they aren’t going to lose their minds.”
Often clients trust specialists like Duff to the point that they don’t even come to the auction—they just ask RM staff to look over a car and decide whether it fits their specifications. “You’re transacting in what can be multi-million-dollar cars that you don’t even see,” says Nadal. “You don’t test drive them, you don’t get a chance to inspect them. They’ll fix whatever needs to be fixed to make them right. And, in my case, right means perfect.” Duff is Nadal’s man, and though the executive is effusive in his praise of the car specialist, he does admit, “I don’t think my wife is all that fond of Gord.” She likes Duff as a person, Nadal clarifies, but he’s also the catalyst for “dramatically expanding my investment in high-end classic cars.”
Clients with more modest budgets aren’t completely shut out. At RM’s Monaco auction, a 1953 Fiat went for $24,000, while a cheery green 1952 Vespa was a comparative steal at $17,000. There’s also RM’s more mainstream arm, Auctions America, created in 2010 when RM bought a famous auction park in Auburn, Ind. It focuses on collectible cars, including Porsches, muscle cars and ’50s and ’60s classics that usually sell for less than $200,000, and has four auctions annually, including two in Auburn. “Anybody in the collector-car hobby has either gone, or has it on their bucket list to visit Auburn on Labour Day weekend,” says its president, Donnie Gould. Last year, more than 75,000 people turned up. This year, NBC’s sports network will broadcast events live. This spring’s sale in Auburn generated $19 million, triple the previous year’s tally, thanks to Montreal’s John Scotti selling off 400 muscle cars from his collection. This year, Myers expects the four-year-old Auctions America to make $100 million in sales, around 20 per cent of the group’s total.
RM Auctions,which racks up around $400 million in sales, is also branching out. Last year, the firm teamed up with Sotheby’s in New York. Myers, who has known the Sotheby’s chairman for years, wanted to display 34 cars as “fine pieces of automotive sculpture” in Sotheby’s galleries on the 10th floor of its Manhattan building. The auction was a blockbuster—US$62.8 million worth of cars sold in two hours. Myers’s company has its competitors—Mecum, Bonham’s, Gooding & Co.—but, in sales, Bietzk says no one comes close to the Canadian firm.
Myers has never seriously considered moving the firm out of his hometown. That’s where 82 of its 140 full-time employees are based. He owns 75 per cent of the RM group (two employees own the rest) and has no plans to retire. Still, his vice-president is 27, and he’s building a stable of under-40s who are already old-timers at the firm.
Like his clientele, Myers is an inveterate collector—and not just of cars. So many owners come to Chatham—it’s known as “Chat-Hamptons”—to check on their cars being repaired that Myers bought a block of Victorian-era brick buildings and turned them into the Retro Suites Hotel. It’s filled with antiques and collectibles that Myers has picked up over the years. Nutcracker toy soldiers that used to guard FAO Schwarz are in the lobby, while a Harley motorcycle hangs from the ceiling in one suite. Myers, who’s also a Harley dealer, has a “couple of hundred antique motorcycles hanging around.”
He hopes automobiles will one day be exhibited in one of the top museums for the works of art that they are, and is even mulling over opening one himself. Earlier this year, he said he was on a “buying sabbatical,” largely because he was running out of places to put them. By June, he was buying again. For his first grandchild, a girl born in July, he’s put away a Lamborghini Countach. Sure, Myers thinks it will be a good investment down the road, but there’s also the fun of introducing a new generation to the fine art of car collecting.
Treble, Patricia. "Fast Money, Fancy Cars: How One Ontario Drop-out Made It Big." Macleansca. N.p., 9 Aug. 2014. Web. 23 Aug. 2014