The Real Car Business

As you look forward to 2011, recognize that it really takes the first three weeks of January to "start" because buyers have to re-gauge values and are in a recovery mode from the relative inactivity of Christmas and New Years. The key to recognize (as a seller) is that by the end of January values will be as high as they have been since October; this is an optimal time to sell your 90-day units. Foremost, contact your auction coordinator NOW to talk about a plan to pre-register your aged units in advance for the later part of January. Also, think a day or two ahead of your usual auction schedule to allow for weather delays transporters will incur and the additional reconditioning you will need as a result of the winter weather. Finally, broadcast to your sales managers that by January 30th, 90% of your oldest inventory MUST BE SOLD. Having the knowledge and the tools in place needed to make early decisions in the auction business in January is critical. By putting you...

In response to National Automobile Dealers Association’s chief economist Paul Taylor's comments, "Used Market Helping to Spur New-Car Growth" (Auto Remarketing Today, 12-3-10), I thought I would offer a bit of my own analysis. The increase in new vehicle sales is much easier to understand because the public buying decision has been so dumbed-down: $0 down $0 interest for as many months as you want! This alternative to fleet sales and endlessly evolving lease deals on the car makers part is very practical because "borrowing" sales now actually builds future availability of used product (Nissan Altima, Hyundai Sonata, and Honda Accord for example). And when these $179/mo models begin to come back to market, the very same marketers will already have in place a slightly different segment of new models at attractive discounted rates, there by repeating the cycle! Mr Taylor's analysis as a "shortage" in used vehicles should really have been branded as a...

It has been too long since I have made a report, but the consensus is that new cars are "soft" and "...prices for used at auction are too high...". Now, in my 20 years at auction these two comments show up in all market conditions and are brandished far to often... but never more then during 'vacation'. I think that going forward and in to September, vacation is a real factor to take a look at (and always will be). Traveling out of Maine last week, I-95 north was busy! Trucks, vans, and cars of all sizes were pulling or carrying all sorts of summer-fun and other than one '79 high-top Vandura broken down, I didn't see that many units that needed to be replaced. What's being driven today by the majority of owners is just fine for them. Their 2008 lease is not up for several more months, the 2002 Suburban is probably paid for and runs great, and with all of the economic clouds... the others will continue to maintain what they have. Combin...

As a whole, the market has leveled from the increases we watched late January through March. I see domestic full size SUV and "luxury" pick up trucks declining. Sports and cvt's peaked very quickly and may have already declined (Corvette as an example); however, this segment was VERY strong this year. Camry and Prius suffer still ; 09 Prius w/23K sells @ $14600. 2010 LE Camry as low as $14600. RAV , Tacoma, and Corolla all firm however. CR-V EX(L) very firm; difficult to buy at auction; 09 NAV w/19K Wednesday in CT sold at $23700. Pilot selection/#'s crossing the block are down which has pushed values up a bit. There are no more 2009 Pathfinder or XTerra rental/program units in the pipeline , so when one hits the block its near record high! Accords, Altimas , Sonata readily available at auction; selective buying here a good opportunity even as these "discount" units butt up against very attractive new car deals. Higher mileage (non-retail) unit...

After our last post, we said that it was any one persons guess as to where the top was. On the other hand, if you are a truck buyer up to speed, you realized that today's buys were really good buys! Trucks have not fallen off the table, but that group as a whole is softening; as it should with 90 degree weather and every soft-top showing its stripes!! Another segment that has been too far out of whack (domestic cars 1998-2004 with 80K-140K) is also adjusting down now that the "tax season" buyer is backing off. I say we have come to the realization that there is a dollar number that nobody can bid past- and that mark is being set as we type. Retail new car incentives are so so available, leasing is on the rebound, and reality has hit home. There are still a number of buyers that feel it's worth more... and that will keep us guessing until we see a measured, or quantitative drop in value(s) that NADA recognizes as well. Keep sharp and look throughout the auction lanes...

At auction the previous two weeks, the one trend that you here repeated is, "... man, there are just no cars out there...". What buyers are saying is they don't see the vehicles they want in the mileage brackets they (think) they want! The reality is that there are so many cars and trucks at auction in a mileage bracket many just plain old don't care to pay attention to. A 1998 Nissan Pathfinder is an "old" unit. Now add 203,114 miles! If you where under the gun at your Honda dealership or Ford store on a rainy Tuesday night and this looked like the last customer of the night (who is also tired because she has been shopping your competition all day), what would you put on this vehicle? Try again! You could miss that vehicles value by $1600 and may be thinking that it's not even worth $1600... and you would be right. But what did this unit sell for? $3,200 in Connecticut on 2-24-10 at wholesale auction. My point is that while we are all consumed ...

For years I had an ongoing debate with an auction executive about whether cars where bought or sold at auction. There where many conclusions involving this brain teaser, but the real issue escaped a true definition. * A vehicle deteriorates mechanically, physically, financially, and even emotionally. There is no order of importance here and there are others means by which a vehicles becomes less or more desirable within a live, competitive-bid auto auction. But how the actual cash value ( ACV ) is derived at is the most important component in defining and answering this critical question in today's market. * Consider this: you are a buyer at auction who has no limitation as to what you can spend on a car. Sixty days later, having removed your crown, you drop your cars out of the sky and return from the auction with a check for every vehicle, right? Wrong. You curtailed that vehicles future lifespan to severely when you got the ACV wrong and now are faced with factoring in that ...