As many of our readers will now know, Sotheby’s Canada yesterday announced its withdrawal from the “theatre” of Canadian art auctions. While this is being hailed in some corners as a victory for competing Canadian auction houses, in our opinion it is an affirmation of the growing popularity of no-risk private-treaty sales, the kind of transaction art galleries like ours do as our daily business. These private-treaty sales, distinguished Ireland-based art economist Clare McAndrew suggests, already represent 52% of the art market business. And, indeed, 2012 was a record year for sales at our fixed-price gallery. Sotheby’s decision is in part a manifestation of private sales as an increasingly desirable vehicle for selling important works of art.
Despite the fact that Sotheby’s Canada was in some ways a competitor of ours, we do regret the lost participation of a major international auction firm in the Canadian art market. However, in appreciation of the fact that major Canadian art auction houses have generally posted stagnant or declining aggregate sale totals since 2007, the realignment of their business is not surprising.
Sotheby’s is an enormous firm with enormous resources. Let’s face it: If they had wanted to put any of their Canadian auction competitors out of business there is little doubt that they could have done so. Fortunately for those competitors, the growing Canadian market is still relatively small compared to Sotheby’s core business in the international art markets, where one painting by Mark Rothko can be worth more than four times the highest Canadian art auction sale total ever recorded. In the eyes of those at Sotheby’s New York and London headquarters, the competition for such a limited quantity of collectible Canadian art works undoubtedly led them to conclude that, as my girlfriend would say, “the juice isn’t worth the squeeze”. They will continue to do what I can only speculate was an infinitely more significant part of their business in Canada, sourcing international works of art to auction in one of the bigger markets where they are active.
It was back in about 1972 when Christie’s discontinued its Canadian art auctions in Montreal and exited the Canadian art market entirely but the latter have certainly remained active here, collecting high end consignments for export to their sales rooms abroad. Likewise, in our opinion, Sotheby’s is simply responding to the demands of today’s market in the interest of its shareholders.
If there is a victory here, it belongs not to another auction house but to the concept of fixed-price private sales.