Christie’s and Sotheby’s are taking chunks out of each other in the art market, waiving fees and entering risky deals to keep the market perky. Paintings by Picasso and Modigliani continue to fetch record prices, but buyers are picky and auction houses are often left with zero commission.
Christie’s is privately owned by French billionaire François Pinault, while Sotheby’s is listed in New York. Its filings show that the art market has struggled to match the heady days of 2007, with sales and commissions shrinking. The two firms have previously been caught colluding, but are now going to extreme lengths to win the glitziest pieces.
The “Moet-and-Beluga” auction trade is in a price war, says Businessweek, with companies agreeing to “absurd deals” just to be seen selling a Rothko. In some cases, Sotheby’s is returning fees to sellers to keep clients happy, or guaranteeing minimum prices, leaving it on the hook when bidding falls short. Perhaps potential sellers should take advantage while this lasts – the art market is notoriously “down and up”, as The New York Times notes. One minute it is bemoaning a subdued Impressionist sale, the next celebrating a contemporary sale as “evidence of the market’s resilience”.