Artprice: After Recovering Top Position, is China Preparing the Final Attack with Sotheby's - Addendum to Artprice's H1 Art Martket report

Jul 29, 2016, 08:46 ET from Artprice.com

PARIS, July 29, 2016 /PRNewswire/ --

During the first half of 2016, China beat the United States to first place on the global art market.

In the H1 Art Market report published in collaboration with Chinese institutional partner, the Artron Group and AMMA [Art Market Monitor by Artron] headed by Wan Jie, Artprice announced that, defying all forecasts, China had upped 18% and recovered top position from the USA.

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Mainland China's art market is still undergoing substantial readjustment: its secondary art market sold fewer lots (down 22%) and its overall unsold rate remains high (at 64%), but its total Fine Art turnover posted an +18% increase.

China's problem with unsettled bids has now been resolved by an extremely strict legal framework that has been in force for 2 years, making the Chinese Art Market the world's most controlled and reliable market.

Hong Kong - an integral part of the People's Republic of China - is at the heart of the process of stabilisation of the Chinese market and is proving to be of paramount importance for the nation's art market.

Hong Kong is the only major marketplace in the world that has continued to post market growth (nearly +10%) and it is clearly keeping the Chinese art market alive.

The 'soft power' battle for the leadership of the Art Market that confronts China and the USA took a major turn with Taikang Life Insurance taking 13.5% of the American auction house's capital. Its CEO, Chen Dongshen, owns Chinese auction house China Guardian, the top 4th auction house worldwide.

This reignites speculation as to whether Bonhams UK could be sold to Poly Auction.

As Taikang, of which China Guardian holds a 24% stake, has joined Sotheby's capital, it has also become Sotheby's biggest shareholder.

Chen Dongshen's acquisition of Sotheby's capital is the result of his lifelong passion. He founded China Guardian 25 years ago, three years before founding insurance company Taikang, which shareholders include, among others, Goldman Sachs (13%) and a Singapore fund.

Fifty-nine year old Chen Dongshen was born in 1957 in central China's Hubei province. He earned a doctorate in economics from Wuhan University, and worked as chief editor of a government-owned business magazine before founding China Guardian in 1993. Chen Dongshen also happens to have married Mao Zedong's granddaughter.

Chen Dongshen had thoroughly examined and analysed Sotheby's Hong Kong events to optimise auctions at China Guardian. He has mixed his interests in art and insurance and prominently displays traditional Chinese calligraphy and paintings in his offices.

In Beijing, a Guardian Art Center is under construction and its Museum clearly aims at international recognition.

According to Tad Smith, Sotheby's chief executive, the auction house's board met with Taikang's executives and warmly welcome their support of Sotheby's strategic initiatives.

China Guardian posted $553,020,191 in turnover last year and is Taikang's biggest shareholder, with a 24% stake. The Artprice figures cover public auctions of Fine Art (painting, sculpture, drawing, photography, printmaking and installations).

Sotheby's, the only major auctioneer whose capital is traded on the stock market and listed in New York, enjoyed a 28.3% increase in its share price since 1 January 2016, suggesting that the financial markets are confident in the art market.

La consolidation des deux Maisons de Ventes donnerait à l'entité nouvellement formée une place de leader mondial incontestée et scellerait définitivement la Chine comme n°1 mondial du Marché de l'Art.


   
    2015 ranking of auction houses

             Auction house                Turnover            Lots sold
    Christie's                            $4,968,338,763               19,238
    Sotheby'                              $4,570,332,893               14,805
    Poly International                      $767,441,423                8,095
    China Guardian                          $553,020,191                7,695
    Phillips                                $397,524,395                3,311
    Beijing Council International
    Auctions                                $294,044,650                3,720
    Shanghai Jiahe                          $160,679,547                1,893
    Xiling Yinshe Auction                   $199,486,812                3,140
    Beijing Hanhai Art Auction
    Co.Ltd.                                 $147,791,657                4,492
    Bonhams                                 $143,121,888                8,949


   
    H1 2016 ranking of auction houses

             Auction house                Turnover            Lots sold
    Christie's                            $1,732,079,216                8,633
    Sotheby's                             $1,670,340,449                7,357
    Poly Auction                            $415,730,668                3,356
    China Guardian Auctions                 $276,034,970                2,717
    Beijing Council International
    Auctions                                $270,427,332                1,297
    Phillips                                $155,359,554                1,888
    Xiling Yinshe Auction                    $86,894,919                1,998
    Bonhams                                  $83,465,432                3,729
    Holly International Co.Ltd               $57,343,074                  596
    Beijing Tranthy International
    Auction                                  $47,731,762                  198

Reminder of Artprice's previous release: H1 2016 Art Market report. Defying all forecasts... China upped 18%, recovered top position

  1. China returns to the leader position as the world's largest art marketplace with a +18% increase 
  2. Hong Kong posted H1 growth of 10% 
  3. Market liquidity has been guaranteed by transactions volumes up 3.2% 
  4. The Western auction market posted a stable unsold rate of 28% 
  5. Low supply of masterpieces reduces Western auctioneers' turnover 
  6. Fewer records, but stronger activity 
  7. The market price index gained 10% in the 2nd quarter of 2016 

Full report available on line for free at 

http://imgpublic.artprice.com/pdf/semestriel_2016_en.pdf

Copyright thierry Ehrmann 2016

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