The Next 18 Months

Change is constant and right now this wholesale market needs to change to re-identify itself. The issue is that auctioning in-the-lane is not changing and a gruesome pattern exists. The imbalance between what you own a vehicle for and whats its ACV is at the block continues to widen and [the] most significant factor are escalating auction fees. This one pervasive objection as the reason NOT the buy and sell at auction is as strong as I can recall. A correction in the big economy (the "Trump" effect/the Dow at 19,535 and futures today at +18.00) is one fix. Over the next 12-18 months a growing optimism index, reductions in regulations, and lower tax burdens will strengthen both the new and used car markets... and at that point, fees are not as objectionable. But it is not just fees themselves that will siphon cars off the block. On-line transactions are growing as are the number of system and software capabilities available to large dealer groups to conduct their own wholesale auctions. In this blog a few years back... I foretold of the "from above" factor. Car buyers have become more comfortable stepping away from sole dependency of in-the-lane buying and again, in the next 12-18 months, I can see as many as 25% of all "auction" cars not crossing an auctioneers block! Both on the calendar and in the lanes, this market is over. Trucks are not effected, LUXURY SUV's are insulated... but after that until we see a big tic up in the overall economy, educate yourself and your managers on how to look at the change in your wholesale process needed going through 2017. W/