Hagerty goes public to pursue a simple mission: save driving

On a Monday in early December, the New York Stock Exchange acted as a vintage car museum. At one end of Broad Street, outside the inter...


On a Monday in early December, the New York Stock Exchange acted as a vintage car museum. At one end of Broad Street, outside the interchange, sat a stately, high-roofed 1921 Duesenberg coupe. On the other, a fearsome 1966 Ford GT40 race car. Between them, enclosed in a glass display case, was an imperturbably cheerful 1967 Porsche 911S.

McKeel Hagerty was shaking hands near the coffee stand. The managing director of the classic car insurance company that bears his name, Mr Hagerty was there to ring the opening bell and celebrate the first day of trading for his new public company (HGTY). Later, during brunch in the Big Board’s conference room, Mr. Hagerty brandished a ceremonial gavel and said, “This is just the beginning.

The origins of Hagerty, the company, are much more humble. It was founded by his parents, Frank and Louise, in 1984, in their basement in Traverse City, Michigan, as a boutique wooden boat insurer.

In the early 1990s, the company began insuring collector cars. With Mr. Hagerty at the helm, he became one of the largest indemnifiers of vintage vehicles, with over two million classics to his name. The actuarial data needed to determine the costs of repairing and replacing these cars has also made them a leading authority for their valuation.

In recent years, Hagerty has significantly expanded its mission. He ventured into the editorial realm, publishing unlimited automotive coverage on Hagerty.com, as well as YouTube, where he has 1.75 million subscribers. He publishes a monthly car magazine, Hagerty Driver’s Club, mailed to 1.2 million readers, as well as a semi-regular lifestyle publication, Radius, distributed to its top collectors. He bought Disk sharing, a peer-to-peer classic car rental platform, like Airbnb for vintage vehicles.

He opened half a dozen vintage car storage and salon spaces, Garage + social networks, anywhere in North America where members can gather and preserve their cars. It acquired the rights to major concours d’elegance events for aficionados to show off their classic cars at Amelia Island, Florida, Detroit and Greenwich, Connecticut.

And through his non-profit organization Hagerty Driver Foundation, the company organizes events to promote the collector car hobby. In collaboration with the Ministry of the Interior, the foundation also proposes additions to the National Register of Historic Vehicles – a designation for cars notable in American history and culture, similar to the National Register of Historic Places.

Hagerty went public via a after-sales service, or special purpose acquisition company, raising about $265 million in the process with the goal of expanding. So what are Hagerty’s ambitions now? And why did it have to go public to achieve them?

“The purpose of the company is to save driving and car culture,” Mr. Hagerty said emphatically, as we piloted a Hagerty-insured 1972 BMW 2002 tii toward the tip of Lower Manhattan. “If we’re going to save car culture, we need to make investments outside of the core business and really help create a whole ecosystem.” Achieving this lofty goal required hundreds of millions of dollars of additional investment, he said: “It would have been difficult for us to afford as a private company.”

The market now values ​​Hagerty at around $3.1 billion. And the scale of its proliferating ecosystem has raised suspicion in the hobby. “Someone said to me, ‘We hope they don’t haggle everything,'” said Ken Gross, a veteran automotive writer, top concours judge and museum curator.

This apprehension mainly revolves around homogenization: “People fear that they will all become the same. Looking at economies of scale, business efficiencies and the like,” Gross said. “Something that had been run by enthusiasts is now run by a company accountable to shareholders.”

The Hagerty family retains 52% of the business, but Mr. Hagerty accepts this criticism. “I think that’s fair, given that the world of fun cars has never had a bigger brand. And we’re doing a lot of things,” he said as he pressed the accelerator pedal. the BMW to avoid a stall as we were idling on Canal Street.”I can’t get mad at people who doubt us. We just have to show up and say, come and do it.” experience for yourself, and I bet you’ll like it better than expected.

Mr. Hagerty’s goal is to maintain the uniqueness of these events, “the fun, the playful side, the twinkle in the eyes” while “improving the administrative side” such as the digitization of ticket sales and concessions and improving the sponsorship experience. He also spoke passionately about the need to compel young collectors.

Hagerty has already tried this in his first edition of the Greenwich Competition, in 2021. It included a Lemons Contest, which featured nadir vehicles from the automotive industry, from the mid-1970s to the mid-1980s. It incorporated a RADwood event, with cars from the 80s and 90s. “And we’re going to add children’s programming to all the events on a much higher level,” Hagerty said.

Energizing the younger generations is particularly important: In order to maintain interest in vintage cars, new enthusiasts must supplement the aging population that has long been the heart of the hobby. Such a change is already underway. The last two years “have been interesting years because for the first time over 50% of our new customers were born after 1965, so Gen X and Gen Y,” Hagerty said, as we filmed south on Broadway.

Mr Hagerty talked about breaking down barriers – like removing the velvet ropes around cars at competitions and letting young children come in and honk their horns. He called for more regular youth programming. He championed “a much friendlier attitude towards video games” as a ramp to initial engagement. And he discussed expanding the national workshops that Hagerty already hosts: to expose young people to old cars, to teach them to drive a manual transmission and to provide scholarships for driving.

It even has plans for the not-too-distant future, when gas-powered vehicles could (and perhaps should) be more anomalous. “I’m a fan of some of these thoughts electric conversions of classic cars. And if the only reason a next-gen classic car owner will buy a car is if it has an electric drivetrain, my opinion is ‘Great’,” he said as we approached again. the stock market. “So I could see us exploring that very deeply and figuring out if there were any partnerships to be had and what we should be doing to be a bigger player in that space.”

As we finished our drive and discussion, he reiterated his mission to “save the ride.” But he explained that this mantra was not intended as a combative slogan to deal with inroads like congestion pricing or driverless cars. “I don’t see us as some sort of NRA of the automotive world,” he said. “I love the love, the joy and the fun of motoring. I’m not on, ‘Fight us for that right.’ Maybe it’s for someone else, but it’s not my jam.

Outside experts concurred with this assessment of Mr. Hagerty’s vocation. “They encourage driving. Their slogans are all the time: “Drive your cars,” Mr. Gross said. “In some ways, do you think, it’s a bit strange for an insurance company. You think they want you to drive as little as possible to minimize risk. He’s laughing.

Instead, Mr Hagerty said he genuinely wanted to help people find pleasure in the “experiential sides” of motoring, those organized around adventure, preservation, culture and the inheritance. “I think if we can help understand why people drive and love cars, other than to get from point A to point B, then we win.”

Mr. Gross agreed with this plan. “I don’t know how many companies come the long way. And that’s what Hagerty is doing here. They don’t just sell insurance. They try to make sure the reason you need this insurance is viable and fun, and a lot of people do that,” he said. “As a business strategy, it’s pretty smart.”

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Newsrust - US Top News: Hagerty goes public to pursue a simple mission: save driving
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