Robert Smith’s front page report that a 25 per cent first-half decline in global auction sales at Sotheby’s constitutes a “chill in the art market” needs a bit of context (Report, August 31).
The value of the global art market’s total annual sales, as calculated by consultants Arts Economics and their report, commissioned by Art Basel and UBS, has been hovering around $60bn for each of the previous 10 years — with the exception of 2020. When considering an average inflation rate, to be flat the market would now be somewhere in excess of $90bn. In fact it may end 2024 closer to $50bn, a decline since 2014 of about 40 per cent. This is not a chill! The art market is fully enveloped in an ice age!
The reasons are numerous. Much of the art market is not measurable due to the well-documented evidence of money laundering, fraud and an overall lack of transparency. Where it is measurable, apparently as presented by Arts Economics, the sector is clearly inhabited by fantasists. Every year the report concludes with varying levels of optimism, only for the next year’s report to confirm a less optimistic reality, along with the annual tradition of a revised optimism for the following year! While many gallerists and dealers may shudder at the comment that “luxury spending in China is among the factors weighing on demand for fine art”, it is the luxury goods sector model that might offer some inspiration.
Louis Vuitton — still universally regarded as perhaps the most exemplary luxury goods company — for instance generates revenues in excess of €20bn pa, or around a third of the entire value of the global art market.
Maybe Hauser & Wirth, the art gallery group, admires this model — retaining an exclusive inner core while nurturing a more inclusive brand? Maybe Gagosian admires the model of Hermès? There is a bright future for the art market but it has nothing to do with the art market!
Christopher Everard
London W2, UK
