We take a deep dive into recent collector car market performance of the first Mustangs
The Mustang was a remarkable success for Ford from day one. The relatively simple, sporty car proved a hit with the booming youth market, as Ford sold an astounding 681,989 Mustangs during an extended first model year in 1965. The following year was every bit as successful, with 607,568 sold for 1966. In subsequent years, Mustang sales began tapering off, but the appeal of those early cars has never seemed to falter, with a collector mentality surrounding them almost since they were new.
In this Market Snapshot, we take a look at the performance of those early Mustangs on the collector car market, with a detailed look at how those vehicles have performed on Hemmings Auctions and Hemmings Make Offer listings in particular. We also offer some guidance as to what affects those values with buyers.
Early Mustang buyers were clearly enamored with the car’s fresh, European-inspired styling, which was particularly emphasized with the long hood and short deck. Those same buyers could choose from three different body styles in the form of the two-door Hardtop, the drop-top Convertible and the Fastback 2+2, perhaps the sportiest of the bunch. Sporty bucket seats and floor-mounted shifters were standard equipment, though a bench seat was available on the Hardtop and Convertible.
Inline-six and small-block V8 engines offered familiar drivetrains and much of the Falcon-based Mustang’s other mechanicals were also off-the-shelf components from its compact stablemate. Performance varied from the leisurely pace offered by the 170-cu.in. and later 200-cu.in. OHV inline-six to a variety of small-block V8s, which ranged from a two-barrel 260-cu.in. mill to a relatively potent four-barrel 289 that was also built with specifically high-performance components beyond its carburettor and intake
Never a muscle car in its earliest incarnation, the Mustang instead, when pressed into competition, made its presence known on the road course, a situation helped with the optional Special Handling Package, front disc brakes and limited-slip differential. Those high-performance components were just a few items on a rather long list of Mustang comfort and convenience options that allowed a buyer to highly personalize his pony car. Additional dealer-added accessories such as speakers, remote outside mirrors and even the famed Rally Pac tachometer and clock gauge package, were also available.
Good looks, the potential for high performance, near instant recognizability even beyond the hobby, and the potential for a rollicking good time behind the wheel have made the Mustang very popular with enthusiasts for a long time. Add in strong support from a very active club scene and perhaps the most abundant supply of parts for any vintage car and it becomes easy to understand why the Mustang is so popular with collectors. That parts supply includes nearly every body panel and component of the unibody for both 1965 and 1966 Convertible and Fastback models.
That popularity translates directly to the marketplace, with Mustangs very commonly seen at auction, both live and on digital-only platforms like Hemmings.com. In our research, the Mustang is second only to the Corvette in terms of the overall volume of the number of cars bought and sold on the collector car market.
Recent Value Trends
Overall, for 1965 and 1966 Mustangs sold on Hemmings.com, we saw an increase in the average sale price from 2020 to 2021 of approximately 10%. This average value decreased 4% from 2021 to 2022, and fell a further 19% in 2023. This value trend was seen in many segments of the hobby last year. A lot of factors likely contributed to this movement, including a pandemic run up that was bound to run out of steam, tighter availability of money and changing demographics.
Perhaps one of the lesser reported facts that contributed to an overall market dip last year was the sheer increase in the volume of collector cars being traded so publicly. When people see a market for a certain asset go up, they may find themselves more inclined to enter that market. On Hemmings.com, we saw exactly that in 2023, with our highest volume yet. The number of 1965 and 1966 Mustangs sold directly on Hemmings.com went up 67% from 2022 to 2023. If the first three months of 2024 are any indication of what’s to come the rest of the year, we are already trending 76% better than last year in terms of volume of those models sold on Hemmings.com.
Early Mustang values hinge a lot on the body type, with the Fastback 2+2 model outpacing the Convertible, which outpaces the Hardtop coupe. Values can vary widely between the different models even when similarly equipped. Though the Hardtop vastly outsold both the Convertible and the Fastback when new, the latter two are better represented in the collector market than original production percentages for the simple reason that these more valuable models have attracted the investment of proper storage, maintenance, and restoration over the years. Curiously, while the Fastbacks sold on Hemmings.com outpaced Convertibles and Hardtops from 2020 through 2022, a couple of very strong sales of Convertibles last year brought its average over that of the Fastback. But comparing the median sales of such cars, the Fastback does outpace the Convertible as expected.
Finally, one other area we tracked was how well these early Mustangs performed against reserve. Unlike some other platforms, we are not shy about sharing our reserves on successfully sold auctions. We believe that by looking at how much the bids exceed the reserve, we get a better idea of demand. This performance against reserves largely mirrors that run up in prices from 2020 to 2022 follow by the tapering off in 2023. Early indications from 2024 tell us that demand may be picking up again based on an increase in this metric.
What Affects the Value of an Early Mustang
The same rule that holds true for the vast majority of collector cars holds true for early Mustangs: The cars in the best condition will almost always perform better than the rest of the pack. Why “almost?” Because certain cars with the right provenance or history will trump condition, but those cars are very few and far between. A good example is the 1968 Mustang GT used in the Bullitt movie, famously driven by Steve McQueen as police Lieutenant Frank Bullitt. This documented, one-of-one ’68 Mustang, a genuine piece of Americana and film history, famously sold for $3,740,000 at a live auction in January of 2020. Cars such as there are super rare. For the vast majority of vehicles, condition matters.