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All you new car dealers have taken me back!
Thanks to online auction services such as ACV Auctions and Dealer Simplified, I’m now back in the new car dealer environment. I thought the days of me being an asset as an appraiser were over. Now I hear some stores are actually throwing parties for me to return and buy their wholesale cars!
Since the day I became an auto wholesaler 25 years ago, new car dealers would tell me what a menacing lot of people wholesalers were. In those days, the fear that every wholesaler was ripping you off by low balling all the appraisals was HUGE!
There was always the undercurrent of suspicion from owners that backroom deals were done by their managers. If a wholesaler lived in a million dollar house, he must have done something shady to get the cars to be able to make THAT kind of money!
We were a RUDE crowd. I remember being in a large Toyota dealership showroom one day watching 2 guys wrestling on the ground over a set of keys! That didn’t say much for our integrity.
That’s the way it has been for the last 6 or 7 years. If I wanted to buy a car from XYZ Honda, I could go to their weekly bid. If XYZ Honda took all their cars to the sale, I would have to go to that auction and buy them!
I can finally get the cars I want at the prices I want to pay. I no longer had to take the “ugly Betty” or the “broken Hoopti” to get the one desirable car they had! I no longer had to stretch an extra $500 so they could make their retail deal. I no longer had to take the phone call from a used car manager at 8:30 on a Friday night while I was at my son’s basketball game.
So, everyone’s problems are solved, right?
In the Northeast where I live, weather is a factor. Sealed bid stores with regular weekly bids may get hit with snow storms on that day. Some times 2 or 3 weeks in a row.
Dealers who decided to take all their cars to the local auction themselves soon found new problems. Maybe your dealership takes in trucks and your local auction only has people there looking for cars. Some of you took in high mileage domestics and your local auction has import buyers.
One week you would sell 18 out of 20 and the next week go 8 for 20. What happened……..
You get the idea.
Kevin Leigh, co-founder of Dealer Simplified, and Joseph Neiman, chief Executive Officer at ACV Auctions have put together programs for you,as a franchised dealer, to market your wholesale trades without going to traditional auctions.
In the coming weeks I’ll be exploring the pros and cons of these new tools. I see many good benefits from their approach but like all competitive businesses, there are weaknesses as well. THAT’S WHAT I DO, exploit weaknesses, I’m an auto wholesaler!
This weeks auctions continue to show signs of lower in-lane participation. Everyone seems to be cautious about their inventory levels, only buying for particular “holes” in their current stock.
General availability of units at auction are down. Pre-Sale listings show a lack of A list cars and trucks at smaller sales while larger venue inventories swell to 200+ units per lane as more off lease vehicles show up.
OVE sales are down. Recent changes in the format- going from 3 day listings to 24 hours has NOT helped! On more than one occasion I have had offers and counter offers wiped out by listings ending. Then when they come back live… CRICKETS…. where did they go!
If you are going to auctions to buy, you should be able to get some deals. As I said earlier, in-lane participation is down, so do your homework, set your comfort price, and some will come your way!
out for now
Barry J. Neuman
member of Manheim’s “superseller” club