Hagerty Inc

Luxury auto executives at Monterey Car Week say the market is splitting even at its highest end, with ultra-wealthy buyers driving record demand while the tier just below them hesitates. McKeel Hagerty, CEO of Hagerty, said $100 million car collections are now being built in months rather than decades, fueled by liquidity events like company sales and IPOs. Bentley CEO Frank-Steffen Walliser said top-end business is very good but more regular customers are slowing, while Aston Martin CEO Adrian Hallmark said it is the middle tier that is most susceptible and hanging back rather than withdrawing. Bugatti CEO Mate Rimac noted the company makes 100 cars per year against roughly 300,000 ultra-high-net-worth individuals, and McLaren CEO Nick Collins cited an explosion of AI-related millionaires in the US, Europe, the Middle East, and China. Lamborghini CEO Stephan Winkelmann struck a more cautious tone, citing war in the Middle East, a weakened dollar, and a dramatically dropped Chinese market, even as the brand posted record revenue.

Monterey Car Week auctions are projected to approach $500 million this year, the highest total since 2022, as luxury automakers unveil new models to attract ultra-high-net-worth consumers. Hagerty tabulated around $432 million in auction sales last year, and CEO McKeel Hagerty noted live auction sales are up 28% over the past 12 months. Bugatti will publicly debut the Destriate, a track-focused Bolide with reduced aerodynamic elements, while Lamborghini is expected to reveal a higher-performance Revuelto SV. Automakers are increasingly using the event to showcase exclusive, high-end vehicles amid a growing cohort of wealthy buyers, raising questions about how long the luxury consumer segment can sustain such momentum.

Hagerty increased its full-year 2026 outlook, citing record first-half growth in members, written premium, and earned premium. First-half written premium rose 19% year-over-year to $713 million, while earned premium jumped 42% to $492 million, driven by the January 1 transition to a 100% quota share arrangement with Markel that gives Hagerty full control of the economics on its U.S. book. The company added a record 279,000 new members in the first half, pushing total policies in force up 19% to 1.9 million. Despite a reported net loss of $5 million that included $153 million in pre-tax transitional costs tied to the Markel fronting arrangement, adjusted EBITDA climbed 32% to $160 million, and cash flow from operating activities surged 91% to $186 million. Hagerty now expects full-year written premium growth of 16% to 17%, net income of $18 million to $30 million, and adjusted EBITDA of $270 million to $280 million.