Independent Online Auto Auction ?

[Roger]

I am looking for a some market research advice. Do you as auto dealers feel that an independent business to business online auction could exist in the market? My idea is that dealers could list their vehicles on the site for about a week to see if they sell before taking them to the traditional auto auction. Dealers could bid any time 24/7 and there would be a live auction once a week where haggling could be done live.

What would you be willing to pay for such a service(commission or flat fee)? How many cars would you list per week? Any advice or comments welcome.

Roger

[BBingham]

Good luck. I have been trying to get dealers to recognize the benefits of such a thing for two years now.

I have two such sites under contract for the end of the year. It is much work for it to work properly.

Good Luck

Bruce Bingham
bbingham@thirdcoastmedia.com www.thirdcoastmedia.com

[This message has been edited by BBingham (edited 08-12-2000).]

[eman]

I think the key to this would be...

Have the off lease cars on the auction 1 month before they are due. Providing the dealer know the car is being returned. Just a thought!

William

[bassador]

Been There, Done That. About 18 months ago. We had several dealers throughout the US who agreed to BETA test the idea. We tried New Vehicles, Off Lease and Even Beatermobiles where the bidding started at $1 with no reserve. It was a great publicity generation device. However, two big issues arose. The big one was that a dealer would post a 10 day auction on a vehicle, then someone else in the dealership would sell the car before the auction closed, and fail to notify anyone. Ohhhh, THAT was MESSY!! And it happened more than once, at different dealerships.

The other problem was that they would really promote the auction feature on their site, be really gung ho about it for the first month or so... then they'd stop doing it. "Too Busy" or "Joe was supposed to be in charge of that..." etc etc etc

I recently read in Automotive News that another company in the Mid-West has started doing this & apparently it's working (carjockey.com) -- but the participating dealers aren't paying for it. It's still a free service being tested out...

We've changed our dealer website auction model, and are going to approach it from a different angle.. but it remains to be seen if it will work, or not.

Good Luck!

[russgentry]

In regards to the Online Car Auction, we use a program called Carjockey.com. We are VERY pleased with the progress. We do very well with our auctions and as with any program..... it is all what you put into it and the support you have at the management level.

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Russ Gentry
wyler.com
rgentry@wyler.com

[bassador]

Yep. Russ is right, from a dealership point of view. You've got to keep with it and have the support and commitment from management.

But, if you're planning on making this service available to dealers, get some really good legal advice and keep a close watch on those auctions!

Another thing to look out for is dealerships bidding up the price on their own vehicles.

Of course they can do that in some wholesale auctions, (and even public auctions, in some states? But not this one.) So they saw nothing wrong with that.

But, if an auction is presented to the general public, and a dealership does this, the Attorney General in a specific state could become *very interested* in those activities.

The dealers who did this didn't realize they were tempting a lawsuit, because they could do that elsewhere. They simply didn't fully understand the legal implications of certain activities in their online auctions. Be sure YOU know what they are, and monitor all your auctions accordingly.

Careful is the key word here

PS: Yep, I know... it's done on E-Bay all the time, but that's E-Bay, with a HUGE legal budget. They can defend themselves or, more likely, settle. Smaller players could get wiped out.