The combined average age of all light vehicles on the road in the U.S. has climbed slightly to 11.5 years, according to IHS Automotive. Registrations for light vehicles in operation in the U.S. also reached a record level of 257.9 million.
KAR Accelerates Buyback
KAR Auction Services Inc. announced it plans to enter into an accelerated share repurchase agreement under which the company expects to repurchase up to $200 million of common stock. It expects to receive an initial delivery of approximately 4.5 million shares of common stock.
Electric Vehicles Depreciate Faster
New data from Black Book shows where mainstream electric vehicles (EV) are feeling some their heaviest depreciation curves, especially in comparison to traditional gasoline models.
Hacking Sparks Fear in Auto Industry
The bytes had barely settled from the Wired magazine article revealing how hackers were able to take remote control of a Jeep Cherokee, when another duo of cybersecurity researchers blogged in early August about taking control of a Tesla Model S by hacking into the car’s entertainment system.
The Wired piece, by cybersecurity researchers Charlie Miller and Chris Valasek, prompted Fiat Chrysler Automotive to recall 1.4 million vehicles equipped with certain radios.
Tesla ofcials said an overthe-air software fix has been distributed to all Model S cars.
The Tesla hackers, cyber-
security expert Kevin Mahafey, who is co-founder and chief technology officer of cybersecurity firm Lookout, and Marc Rogers, principal security researcher at web security company CloudFlare, will present their research at the upcoming Def Con hacking conference in Las Vegas.
The FCA recall aligns
with an ongoing software distribution that insulates connected vehicles from remote manipulation. Further, FCA US has applied network-level security measures to prevent the type of remote manipulation demonstrated in the article.
These measures – which required no customer or Continued on page 5
The U.S. Senate passed this year’s Highway Bill without an amendment that would have forced car dealers to fix any recalls before selling a vehicle.
The amendment, introduced by Sen. Richard Blumenthal, would have prohibited the sale or lease of used cars subject to a recall until the defect or noncompliance had been remedied.
It was voted down by the Senate Committee on Commerce, Science and Transportation, and was not included in the bill that won approval in the full Senate.
The National Automobile Dealers Association, the National Independent Automobile Dealers Association, the
National Association of Minority Automobile Dealers and the National Auto Auction Association opposed the amendment. NIADA members pointed out to lawmakers that it would cause severe logistical problems for independent dealers, raise consumers’ costs and lower the value of their vehicles, all without increasing the number of recalled vehicles being repaired.
“The response by our dealers to this call speaks to their commitment to our industry, and the result of their action speaks to what we can accomplish as an association and as an industry when we speak with a united voice,” said Steve Jordan, NIADA executive vice president.
CARS
LOSING CONTROL: Hackers were able to take control of a Jeep like the one above, according to an article in Wired magazine. Researchers will bring their findings to a hacking conference in Las Vegas.
Rush - Dated Material
EXTENDED ARBITRATION
Now available through September
When you purchase eligible inventory on ADESA DealerBlock and use CarsArrive Network to transport, your arbitration window will be extended to 48 hours after vehicle delivery.
è El igible inventory includes off-lease, rental, dealer, feet and repo vehicles posted in the open sale from an offsite location.
Moving inventory the smart way: 1.7M cars transported each year...and growing!
è Select CarsArrive for transportation at time of sale.
Extended arbitration applies to eligible vehicles purchased on DealerBlock and transported by CarsArrive Network: Buyer has 48 hours from the delivery date on bill of lading to arbitrate. Type 1 transport only; buyer must select CarsArrive at time of sale. Transaction must be paid within three (3) days of sale; sale date equals day one (1). If day three (3) falls on a weekend or holiday, payment must be received by the next business day. Offer applies to offsite vehicles only; ADESA “at auction” units are not included. Valid through September 30, 2015.
Auto Finance Firms Improve Service to Attract Dealers
Dealers are willing to pay a premium for high-quality service from auto finance companies, according to the J.D. Power 2015 U.S. Dealer Financing Satisfaction Study.
The study measures dealer satisfaction with finance providers in four segments: prime retail credit; nonprime retail credit; retail leasing; and floor planning. Satisfaction is calculated on a 1,000-point scale.
Dealer satisfaction in the prime retail credit segment is 868, and in the non-prime retail credit segment satisfaction is 828. Dealer satisfaction in the retail-leasing segment is 894, while in the floor-planning segment, satisfaction is 943.
While dealerships continue to seek ways to improve their margins, they also seek providers to speed customer throughput in the sale or lease of their vehicles and, in many instances, are willing to pay a premium for a higher-quality financing experience. Sixty-three percent of dealers are willing to pay an additional 0.5-0.6
basis points on their loan terms (down 4 percentage points from 2014) to receive good service from their lenders in the prime retail credit segment.
“Speed of funding has become a critical diferentiator in the eyes of the dealer as efcient cash flow is demanded by dealer management, not absolute finance and insurance income,” said Michael Buckingham, senior director of the auto finance practice at J.D. Power. “Fast application processing allowing dealers to speed the customer delivery process is also critical. Auto dealers are willing to pay a price premium for these services.”
A dealer-focused sales rep relationship has a positive efect on satisfaction and retail contract volume. When a high level of sales rep service is provided, satisfaction is substantially higher than when there is no focused support (935 vs. 754, respectively). Among dealers with a focused relationship in which all sales rep relationship key perforpmance
Continued on page 12
MILESTONES
Mel Farr
Mel Farr, the former professional football player who brought starter-interrupt technology into the national spotlight, died Aug. 3. He was 70.
Farr grew up in Beaumont, Texas, and attended the University of California at Los Angeles. He was the Detroit Lions’ firstround pick and the seventh choice overall in the 1967 NFL draft. He was named NFL Rookie of the Year and played in two Pro Bowls.
Farr was awarded a Ford franchise in Oak Park, Mich., upon his retirement from football in 1975.
He operated two Ford stores and, at one point, was the largest black auto dealer in the nation.
However, Farr
wound up losing his franchise stores in 2002.
Farr was famous in metro Detroit for television commercials in which he would wear a suit and a cape, declaring himself “Mel Farr, Superstar.”
Farr was a pioneer in the use of starter-interrupt technology and that unfortunately brought him unwanted attention when he was sued by several customers.
They claimed the devices were used improperly and installed without their knowledge.
The lawsuits were all settled favorably for Farr and paved the way for more widespread use of the devices.
Farr defended the use of the devices on national television and received support from civil rights leader Jesse Jackson.
As the keynote speaker at the National Alliance of Buy-Here, Pay-Here Dealers convention in 2002, Farr said dealers can be financially successful and make a diference in their communities.
“You can make a lot of money,” he said. “You can do a lot of good.”
He warned dealers against trying to squeeze the highest interest rates out of every sale.
Farr also predicted the influx of franchise dealers into the buy-here, pay-here market.
“More new-car dealers are getting into the buy-here, pay-here business,” Farr said.
“New-car dealers know there’s a lot of money to be made here, if you do it right.”
At the conference, NABD founder Ken Shilson praised Farr for the work he’s done in the industry and called him a “pioneer.”
Craig Crandall Strickland
Dealer Craig Crandall Strickland died July 11.
He was 63.
Strickland owned and operated Crandall Auto Sales in Waterford, Mich.
He was the past president of the Michigan Independent Automobile Dealers Association and was a member of the Flint IADA.
Strickland is survived by his wife, Debra (Ecker) and sister Margaret Ann “Peggy” Nichols (Ralph), along with several nieces and nephews.
Jackie Dee Davis
Auto auctioneer Jackie Dee Davis died July 28.
He was 72.
Davis was honored as Auctioneer of the Year by the National Auto Auction Association in 2013.
He first began practicing his auctioneering at the age of 13 in Spokane, Mo., selling chickens, fence posts and milk cans prior to livestock sales.
After about six weeks, Davis was asked to sell cattle, which he did while attending high school.
He did his formal training under the tutelage of Tony Thornton, who taught at the World Wide College of Auctioneering.
Davis lived in Springfield, Mo., where he traveled announcing rodeos and horse shows as well as a variety of auctions.
In 1960, he moved his family to Indianapolis, where he began his 37-year career traveling twice a week to Dyer, Ind., and Chicago.
By General Media LLC USED CAR NEWS (ISSN 1555-7413) is published at 24114 Harper, St. Clair Shores, MI 48080 Phone: 586-772-5200 or 800-794-0760 Fax: 586-772-9400
www.usedcarnews.com
Charles M. Thomas - Founder (1947-2002) Lynda R. Thomas, Publisher Colleen Fitzgerald, General Manager
Editorial: Ted Craig, Managing Editor Jeffrey Bellant, Staff Writer Contributing Writers: Ed Fitzgerald, Jenny King, Sheila McGrath Columnist: Tony Moorby
Used Car News is published the first and third Monday of each month.
Subscribers: We print advertisements as sent to us by auctions and other advertisers. It is not possible to verify the correctness of listed vehicles in auction ads. Most lists are partial and all lists are subject to last minute changes by auto auctions, so before travelling a long distance for a particular auto auction event, contact the auction by telephone for a fax of vehicles in the sale.
Circulation: Emily Brown Baker, Helen Thomas Production: Josie Godlewski, Media Manager Tim Montie, Graphic Designer
Used Car News assumes no guarantees or liabilities concerning the accuracy of any advertisements. All Rights Reserved. Reproduction in any form is prohibited without the written consent of the publisher.
OUR ADVERTISING APPROVAL POLICY
Please submit clear, legible copy. Payments from first time advertisers must accompany the insertion order. Distribution is guaranteed by U.S. Postal Carriers. The advertising reservation deadline is 5:00 p.m. Friday, 10 days prior to the issue date. Camera ready ads must be received by noon on Monday prior to the issue date. Join the Conversation! Visit Used Car News online at www.usedcarnews.com or scan this QR code with your smartphone to be taken directly to the website.
Demand Rises for Used Teslas
The used car market is giving Tesla the opportunity to expand its demographic and geographic reach, according to a new analysis from car-buying platform Edmunds.com.
The analysis, which examined registration data of all Tesla Model S vehicles that have ever been sold in the pre-owned market in the U.S., ofers a glimpse at the potential for Tesla to expand its appeal beyond its base of wealthy, trend-setting customers.
For example, Edmunds found that while only 25 percent of new Model S buyers earned less than $100,000 per year, that number rises to 36 percent of all used Model S buyers. Edmunds also found that used Model S buyers skew younger than new Model S buyers: about 10 percent of pre-owned Model S buyers are Millennials (age 18-34), compared to just six percent of all new Model S buyers.
“The used Model S data proves that with a more attainable price tag, there is demand for the vehicle from a more diverse customer set,” said Jessica Caldwell, Edmunds. com director of industry analysis. “A wide-ranging buyer base is essential for a brand like Tesla that hopes to grow with mainstream shoppers. These findings ofer encouragement for Tesla as it prepares to make its biggest move
Hacking
into the mass market with the upcoming Model 3.”
Tesla’s brand migration in the used market is also reflected on a geographic level. California’s share of used Model S sales, for example, is only 30.5 percent, compared to its overwhelming 42.5 percent share of all new Model S sales.
Meanwhile, used Model S sales are surging in the state of Washington, where its market share of used Models S (8.9 percent) is nearly double its share of new Model S (4.6 percent). In fact, Edmunds’ research found that in 2015 there have been more used Model S registrations in Seattle than in Tesla’s home market of San Francisco.
Other states that enjoy a significantly larger share of used Teslas include Florida (11.2 percent of used Model S sales vs. 7.3 percent of new Model S sales), Texas (8.3 percent vs. 5.8 percent), New Jersey (5.5 percent vs. 3.3 percent) and Arizona (4 percent vs. 1.9 percent).
“It’s clear that the concentration of demand for Tesla is spreading beyond California’s borders to other states in the secondary market,” Caldwell said. “While it’s not uncommon to see used luxury vehicles travel out of large flagship hubs, it is unusual to see it happen to this high of a degree.”
- Continued from page 1
dealer actions – block remote access to certain vehicle systems. FCA states the measures were fully tested and implemented within the cellular network on July 23.
The article created a stir with consumers already uneasy about the growing presence of technology in their vehicles. A survey by Kelley Blue Book found nearly 80 percent of consumers say hacking will be a frequent problem within three years or less.
Politicians were quick to jump on the bandwagon. Senators Richard Blumenthal (D-Conn.) and Edward J. Markey (D-Mass.) issued a statement urging the National Highway Trafc Safety Administration to take immediate action and investi-
gate potential widespread risk.
Edmunds’ Senior Consumer Advice Editor Ron Montoya said in July the incident is generating more concern than is warranted. Montoya said it was an isolated incident on a specific vehicle.
“This is a legitimate issue for automakers and they have been proactively addressing these security concerns ever since the first connected car was introduced,” he said.
“Automakers are notoriously competitive, but this is one area where manufacturers are working together to address these sorts of vulnerabilities. It’s in the entire industry’s best interest to make sure they are on top of this issue so that safety continues to be a top priority.”
State AG Faces Charges
Pennsylvania Attorney General Kathleen Kane faces criminal charges, including perjury, just days after announcing enforcement actions against several used-car operations.
Kane did not enter a plea during her five-minute arraignment Aug. 8 in a Montgomery County courtroom and did not speak other than to respond to the judge yes or no.
Magisterial District Judge Cathleen Kelly Rebar set a preliminary hearing for Aug. 24 and set bail for $10,000 unsecured bond.
legal settlements and a subpoena enforcement action filed as the result of two separate investigations of used-car stores that were violating various state laws and regulations.
The settlements were reached in the form of assurances of voluntary compliance and were the result of work done by a statewide task force comprised of agents and attorneys from the Ofce of Attorney General’s Bureau of Consumer Protection.
The 49-year-old Kane maintains she is innocent amid growing calls for her resignation from editorialists and fellow Democrats, including Gov. Tom Wolf.
Prosecutors say Kane leaked grand jury information to a newspaper to get even with a former state prosecutor she thought made her look bad. They also say she enlisted aides to spy on ofce employees and others to keep tabs on a grand jury probe into the leak.
Montgomery County Assistant District Attorney Kevin Steele said it was a “sad day” in that “there’s been arraignment now for the chief law enforcement ofcer in the state.”
On July 30, Kane announced four
Through July 9, the bureau had visited 109 dealership lots or locations statewide and reviewed more than 3,250 automobile advertisements. The bureau also used undercover stings, investigated consumer complaints and enforced subpoenas to detect illegal business practices.
In one case, David Charney held a vehicle salesperson’s license that expired in 2003, but continued to sell vehicles for his wife’s dealership, 5th Avenue Auto Sales. In addition, the business was using contracts with invalid clauses and failed to disclose the business name and address or the word “dealer” within its advertisements.
Claudia Charney will pay $3,000 in penalties and costs and David Charney has agreed to pay
Continued on page 10
AUCTIONS BOOST DIGITAL SERVICES IN LANES AUCTION TECHNOLOGY
By Jeffrey Bellant
Advancements in auction technology from the largest chain to independents have helped streamline business for dealers while combining digital tools in a physical setting.
“Everything is about a blend of technology and brick-and-mortar synergy,” said Stephanie Gingras, general manager of Dealers Auto Auction of the Southwest. “But more importantly, it’s about people communicating with people on a variety of levels, so we never lose the personal touch.”
DAASW has embraced digital with its 360 Service program ofering 24/7 access to the auction process, from pre-sale pick-up to post-sale delivery.
“We have put mobile devices in the hands of all of our key staf, including our lane leaders, so that they communicate both internally with our staf members as well as directly with our customers,” Gingras said.
Efective this summer, the auction went virtually paperless with its new app.
Through tools from Whann Tech and Web Guys, a dealer can access a run list, view images, see condition reports and Carfax information on a mobile device.
“We have been able to end the use of paper/sticker bidder badges, as our app recognizes you as you enter our building and assigns you a bid number reflected on your mobile device,” said Jim DesRochers, DAASW vice president.
“We also eliminated run lists as our ‘real time’ DAASW. com and .Mx sites are complete with both dealer and repo CRs, announcements, our proprietary Mexico Ready and Carfax Transparent Transactions products and at least eight pictures of each vehicle.”
In addition to simulcast sales in all lanes, DAASW ofers paperless gate releases and invoices texted or emailed to dealers, DesRochers said.
Meanwhile, Manheim, no stranger to technology innovation, introduced its own “2nd Chance Sale” app and a new gate pass process.
In 2012-2013, Manheim started a full-on efort to push technology ahead to improve customer experience.
“This is operation-led, technology supported,” said Ashish Bisaria, Manheim’s senior vice president of customer experience. “That was the genesis of our project. Operations are led by what a customer wants.”
Bisaria said the problem is technology was helping to provide specific solutions, but it didn’t equate to a better customer experience.
Bisaria said the solution is a comprehensive review of Manheim’s eforts to improve a customer’s experience from the time a car comes in through the gate, until it leaves.
“Data, or vehicular information, is at the core of the asset that we are most interested in,” he said.
For example, in the past, a Manheim auction would take images of a vehicle for the purposes of displaying them online and in a condi-
tion report.
But once a car was purchased, the photos were discarded.
“Last year, we moved all the images we take up into the cloud and those pictures are made available to the car buyers,” Bisaria said.
It’s a service for dealers since those photos are taken in the auction studio setting, as opposed to a dealer’s snowy lot.
Bisaria said finding these types of solutions will go a long way in improving customer satisfaction.
Manheim asked customers what were the worst issues they had with the process and two specific issues came up almost unanimously.
“No. 1 was the arbitration process post-purchase,” Bisaria said. “The other was vehicle information. Those were the top two consistent pain points for our customers.”
Late last year, Manheim deployed a new arbitration case management system using Salesforce. The objective is to close 80 to 90 percent of cases within two business days, Bisaria said.
Through Salesforce, employees have vehicle, buyer and seller information at their fingertips. Plus, this system gives Manheim valuable data to drive process improvements in areas like post sale inspections across
all the auctions.
Just since January, Manheim is seeing customer satisfaction jump as a result.
“Historically, we’ve been in the mid-50s,” Bisaria said. “In July, we (trended) 71 to 72 points. The No. 1 pain point has completely changed (because of this).”
Manheim has also introduced a process allowing dealers to collect gate passes at Manheim.com. Through the “My Purchases” tab on the website, customers are downloading, viewing, printing and emailing gate passes directly to transport carriers, saving them time previously spent waiting in line at the auction to collect their passes.
Manheim is now working on the vehicular data/ information issue. In the past, technology was used at the local level. Each auction had its own date/collection process. But it wasn’t shared with other locations. So the next auction would have to recapture all of that information again, Bisaria said.
Manheim is focused on expanding across its 70 North American locations, so instead of 70 places collecting information, there is just one for all, he said.
Getting cars online as soon as possible, having the cars looking pristine, photos online and information collect-
ed, selling the car and moving them out quickly is vital to customer satisfaction on both sides, Bisaria said.
A dealer would be able to look at their entire account – all the cars being bought or sold, the cost and the fees paid – updated electronically each night, he said.
“So if you’ve sold cars in 20 locations and there are sales proceeds for $2.7 million of revenue, less fees,” Bisaria said, “then your account that night will show $2.7 million.”
From the buyer’s perspective, it’s the same thing with all of the information available online.
Manheim’s also making all titles digital, allowing dealers to not waste time sitting in line, Bisaria said.
In the future, all the seller titles will be centrally stored through NextGear Capital, he said.
Bisaria said the critical point of any technology for Manheim is to make the process simple.
“Some people value price, some people value aesthetics and some people value time, but if they are presented with options of equal value, they will always pick the one where the least efort is required,” Bisaria said.
“If we make the model very easy, customers will come and do business.”
Successful dealers are choosing NextGear Capital for their inventory financing needs because we
Offer flexible terms and competitive pricing
Provide them with best-in-class customer service
Equip them with cutting-edge technology
Support them with local representatives
Thousands of access points, dozens of benefits, and one company that brings it all to you.
Better Vehicles. Better Deals. BETTER GET TO KNOW IAA.
IAA is more than just salvage. Every day, we auction high-quality vehicles from rental firms, banks and other sellers at more than 165 locations in North America. It’s your chance to buy low, add inventory and sell at a profit. We’ll even help get you started with a free six-month buyer’s pass.*
Business Settles Lawsuit
The New Jersey Division of Consumer Afairs and AutoSource Group, LLC, a used-car dealership located in Vineland, have settled a lawsuit filed by the division in February, with the dealership agreeing to pay $25,000 and to revise its business practices.
The seven-count complaint alleged that AutoSource Group violated the Consumer Fraud Act, the Automotive Sales Regulations, the Motor Vehicle Advertising Regulations and the Used Car Lemon Law and related regulations. Under the terms of the final consent judgment resolving the lawsuit, AutoSource Group will revise its
business practices to comply with state laws and regulations.
Specifically, the complaint alleged that, among other things, AutoSource Group failed to disclose the prior condition and prior use of used motor vehicles, failed to disclose existing mechanical defects in used motor vehicles, failed to provide required written warranties, and failed to respond to consumer complaints.
The $25,000 payment includes $14,362 in civil penalties, with the balance going toward reimbursement of the state’s legal and investigative costs in this matter.
– Continued from page 6
$500 in penalties and costs.
In another case, William J. Kemper sold, advertised and ofered for sale vehicles without a valid sales license. Kemper previously held a salesperson license, which became inactive in 2001. Kemper also failed to use written contracts that complied with auto regulations.
Kemper will pay a $1,000 civil penalty for failing to hold a valid vehicle salesperson license and also
agreed to renew his license.
Another case involved Below Bluebook Autos, which surrendered its dealer license to the Board of Motor Vehicles and was assessed $9,758 in civil penalties and costs.
The bureau also filed a subpoena enforcement action against Ameri Motors, Inc. and its owner, Jawad Al Amiri, for failure to produce certain documents and information relating to a subpoena.
Auto Finance - from page 3
indicators (KPIs) are met, 68 percent say they “definitely will” increase the percentage of business they conduct with their provider.
Overall satisfaction is highest when sales reps engage in discussions about customer retention (922), dealership performance consulting (916) and training and clarification of programs (916).
Dealers don’t want loan processors; they want collaborative consultants who can support them every step of the way. High-performing lenders provide a range of services that resonates with dealers, which include helping them understand the variety of lending options available and how they can maximize profits, reduce expenses and retain customers.
dealers have to wait one hour to reach their support staf, satisfaction declines significantly to 938. Lender-provided technology that enables same-day contract funding, improves dealer satisfaction. When dealers use eContracting or a proprietary technology provided by their lender, overall satisfaction averages 913, compared with 856 when lenders do not use this service.
Additionally, 56 percent of dealers indicate that faster funding time is the main reason to use eContracting.
The study finds that dealerships retain 59 percent of their leasing customers through retention programs and consumer guidance provided by their lender.
Findings of the study show that assigning/aligning dedicated underwriters positively impacts dealer satisfaction by providing higher levels of service and collaboration.
A majority of dealers indicate their lender provides a dedicated underwriter and/or team who contacts them frequently, providing valued-added communications.
Mercedes-Benz Financial Services ranks highest among lenders in the prime retail credit segment, with a score of 971. Following in the rankings are Mini Financial Services (962) and Alphera Financial Services (961).
Additionally, 75 percent of dealers indicate being able to immediately reach their support staf. When this occurs, satisfaction is 975. When
Mercedes-Benz Financial Services also ranks highest among lenders in the retail-leasing segment, with a score of 978. Following in the rankings are BMW Financial Services (961) and Lincoln Automotive Financial Services (956).
RETAIL MARKETS
OHIO
Scott Welch, owner, Lock 20 Auto, Newcomerstown, Ohio:
“I’ve been in business eight years. I got in when I should have been getting out (during the recession). I started out as a one-man show with about 18 cars.
“I closed down one day a week to go to auction. Now I have four employees and two ofces. We’re in a rural area.
“I have one location and have about 65 cars in inventory.
“We’re selling about 38 a month.
“At this point, we’re up about 5 percent over last year. But this year has been a real rollercoaster ride for us.
“We were up about 27 percent at the end of February. It was the best tax season we had in four or five years.
“But then we hit a lull and at the end of April we were down about 15 percent.
“I buy everything from auctions.
“We’re about 50 percent subprime and 50 percent prime.
“Most of our subprime business goes to Credit Acceptance. If I hadn’t been with Credit Acceptance five years ago, I’m not sure I’d still be in business.
“The average model year is about a 2005.
“The average mileage is about 105,000. We’re carrying more of a later model now. I’ve got some 2010s and 2011s.
“My buying strategy has always been very simple. I would go to the auction, buy a half-dozen cars and bring them home.
“Whatever I sold the first, the fastest and made a lot of money on, I would go out and buy another one.
“If a car sat on my lot for three months, I wouldn’t buy it again. Cars are a commodity.
“I’m 80 to 85 percent domestic.
AndroidAppLaunch-TradeAd.pdf 1 8/10/15 10:13 AM
“I’m in a rural area of the Midwest. I can’t sell Hondas or Toyotas to save myself.
“I love selling trucks. It’s what we make our money on. I don’t sell anything over $12,000 to $13,000.
“I’m buying older trucks and putting a lot of reconditioning into them.
“Pick-up trucks are probably 25 percent of my business.
“I can only process so many of them in the price range I want to sell them at. SUVs are probably 50 percent of my business and cars are 25 percent.
“My average reconditioning costs are $900 per unit. The average recon on trucks is between $1,500 and $1,600. We send everything out for recon.
“All of our marketing advertising is driven toward our website.
“We’re starting to do more with Facebook and we’re starting to see some results.
“We also do some Craigslist advertising.
“I just sold a 2007 Ford Fusion. It had 102,000 miles. I sold it for $7,000.”
VIRGINIA
Rob Fisher, president, Northside Auto Sales, Manassas, Va.:
“I started in 1978, so I’ve been in business for 37 years.
“I have one location. I keep about 75 to 80 vehicles. That’s about the same as last year.
“We’re selling between 30 and 35 per month. That’s up a little bit from last year, maybe 10 percent.
“I’ve been lucky to have a number of wholesalers who supply me with cars. I’ve known them a number of years. I also go to a closedbid sale that a large dealer holds.
“We’ve been a buy-here, pay-here dealer since 1978.
“The average down payment now is about $1,200.
“Average term length is about 32 months. The term length has extended a little bit compared to last year.
“I frown on repossessions. It’s really a failure in my mind.
“I try to stay under 120,000
Compiled by Jeffrey Bellant
miles. Average mileage is going to run in the 100,000 to 110,000 miles. The average model year is 2005 or 2006.
“Average retail price is right at $8,900 to $8,950.
“I carry about 60 percent automobiles, 30 percent SUVs and 10 percent trucks.
“I’m more into imports, probably 70 percent to 30 percent domestics.
“Reconditioning costs have been creeping up, I tell you, to do these cars anymore, it’s about $1,100. People are just letting them go much longer.
“Everything seems like it needs tires and brakes and so on. We have a 90-day warranty and certify these cars through the Virginia Independent Automobile Dealers Association program.
“We have a tremendous website. Our advertising is mainly digital.
“A recent car we sold was a Hyundai Tiburon for $6,950.
“It had 122,000 miles.”
ADESA Boston September 4, 11, 25
508-626-7000
ADESA Charlotte September 3, 17 704-587-7653
ADESA Cincinnati/Dayton September 1, 29 937-746-4000
ADESA Golden Gate September 1, 15, 29 209-839-8000
ADESA Houston September 2, 16, 30 281-580-1800
ADESA Indianapolis September 1, 15, 29 800-925-1210
ADESA Kansas City September 1, 15, 29 816-525-1100
ADESA Lexington September 17 859-263-5163
ADESA Tulsa September 11 918-437-9044
ADESA Washington DC September 23 703-996-1100
America’s AA-Chicago September 2, 30 708-389-4488
Brasher’s Salt Lake AA September 8 801-322-1234
Columbus Fair AA September 9 614-497-2000
Manheim Atlanta September 3, 16, 17
404-762-9211
Manheim Dallas September 9, 23 877-860-1651
Manheim Denver September 23 800-822-1177
Manheim Detroit September 3, 17 734-654-7100
Manheim Fredericksburg September 10, 24 540-368-3400
Manheim Milwaukee September 9, 23 262-835-4436
Manheim Minneapolis September 16 763-425-7653
Manheim Nashville September 2, 8, 9, 30 877-386-5004
Manheim Nevada September 4 702-361-1000
Manheim New Jersey September 9, 16, 23 609-298-3400
Manheim New Orleans September 16 985-643-2061
Manheim Ohio September 8 800-477-6446
Manheim Orlando
September 1, 8, 15, 22, 29
800-337-8491
Manheim Pennsylvania September 3, 4, 17, 18
800-777-2053
Manheim Phoenix September 3, 10, 17, 24
623-907-7000
Manheim Pittsburgh September 23
724-452-5555
Manheim Riverside September 22, 24 909-689-6000
Manheim Seattle September 16 206-762-1600
Manheim Southern California September 3, 17 909-822-2261
Southern AA September 23
860-292-7500
ADESA Boston September 4 508-626-7000
ADESA Golden Gate September 15 209-839-8000
Manheim Atlanta September 16 404-762-9211
Manheim Dallas September 9 877-860-1651
Manheim Milwaukee September 23 262-835-4436
Manheim Nashville September 2, 30 877-386-5004
Manheim Ohio September 8 800-477-6446
Manheim Orlando September 22 800-337-8491
Choose Chase on ADESA.com and OVE.com for quality bank-sourced vehicles. Contact auctions directly for current sale information. *Only Jaguar and Land Rover vehicles will be
and Jaguar Financial Group are trademarks of Jaguar Land Rover Limited and any use by Chase is under license. The Land Rover word mark, the Land Rover and Oval logo, and Land Rover Financial Group are trademarks of Jaguar Land Rover Limited and any use by Chase is under license. Retail / Loan and lease accounts are owned by Chase.
WHOLESALE MARKETS
OKLAHOMA
Gary Smith, president/ owner, Dealers Auto Auction of Oklahoma City, Oklahoma City:
“We’ve been in business since 1988.
“We have 11 lanes. We’ve been running between 1,000 and 1,400 cars. That’s pretty close to the same as last year.
“We’ll sell 50-plus percent every sale. That’s running about the same as last year.
“I think at our Aug. 6 sale we had 900 dealers registered. They come from all over.
“Retail business is picking up for the majority of car dealers. The franchise dealers are selling more because they have a lot better (finance) sources than used car dealers.
“Dealer consignment has been selling about 62 percent.
“We’ve got four new-cardealer trade lanes. They do well because the franchise dealers are good suppliers. We’ll run probably 600-
plus, I imagine.
“Ally Finance and all of the big (commercial consignors) are (at the same levels) as last year. We have a General Motors factory sale every other Tuesday. Volumes are usually good. Numbers are a little down right now, but those will pick up around the second week of September they said. They’ll start getting more turn-backs because of new model years and other reasons. We run 300-plus every other Tuesday for GM.
“We have a government sale once a month. They rotate according to volumes. The GSA sale runs 100 to 175 each sale. It’s a little bit of everything.
“We also do a heavy-duty truck sale on Thursdays. It’s been down. We run 30 to 50. It’s a little bit of everything, even dump trucks.
“The average price in the lane is somewhere around $7,200. But that varies month to month.
Compiled by Jeffrey Bellant
“SUVs have been strong. We also have one of the stoutest truck markets in the country. We have contracts with the big boys (oil and gas companies) like Devon Oil, Chesapeake (Energy Corp.), all of them.”
PENNSYLVANIA
L. Todd Briggs, coowner/general manager, Greater Erie Auto Auction, Fairview, Pa.:
“We’ve been in business just over 11 years. We have five lanes. Right now, we’re running four lanes even on days when our consignment is heavier. It’s always good to keep the lanes tight.
“We’ve been running between 400 and 500 units. Two or three times we’ve been just up over 500.
“Our commercial accounts have increased some. This past week we were within four or five cars of 100. For us, that’s a good run. We’re getting more banks and credit unions involved.
“We have a salvage sale. It varies from 40 to 60 per sale.
Credit Acceptance is a new account for us. So that’s a big national account. We also have Element and some others. Maybe by the fall or winter we’ll have one or two more aboard. We’re making traction.
“We’ve got a special sale on Aug. 18. It’s a special trucks and SUV sale. It will start just after our normal start time, but they will be in a lane by themselves.
“Our consignment has been looking good. (Sales percentages) have been in the 54 to 56 percent range, which I think is fairly respectable this time of year.
“We get a lot of support out of the Bufalo area, which is 100 miles away. We also get some from Ohio. We’re 30 miles from the New York state line and 16 miles from the Ohio line. Probably 70 to 80 percent of our buyers are from the Cleveland area and east.
“We’ll draw from 180 to 225 dealers.
“We got a lot of dealer trades from new-car stores.
Average sale prices are probably in the $4,000 area. The fleet-lease stuf is in the $12,000 to $18,000 range, but there are not enough of those to bring the average way up.
“We just had a quarterly heavy duty truck and equipment sale. It’s a mix of lightduty medium-duty and heavy-duty trucks and trailers. We ran 102 and sold 62 pieces on sale day. We probably put eight or 10 (sales) together since the sale.
“This summer I did an interview with the local newspaper because (the state) took a bridge out across I-90 right near us. I know it had an impact on us. We’ve actually made our own signs to help (direct trafc) to our auction.
“The bridge is supposed to be open (by press time). So we’re having two weeks of dealer appreciation beginning Sept. 1 celebrating the new bridge being open. We’ll have a chicken barbecue, lots of prizes like a John Deere riding lawnmower.”
ACTUAL WHOLESALE AND PROJECTED RESIDUAL VALUES
AUGUST 2015
2013 MODELS
SOURCE: BLACK BOOK
2012 MODELS
2011 MODELS
2010 MODELS
DISCONNECTED JOTTINGS FROM TONY MOORBY
My brother and niece stayed after our recent wedding festivities to take advantage of an extended vacation stay. After all, if you’re going to hand over a tidy
Tony Moorby
• 40-year veteran of the industry
• President from 1997–2000 of ADT Automotive
• Served as ADESA’s executive vice president of sales and marketing
• Moorby & Associates 2006–present
• Awarded the Ring of Honor by NIADA
• NAAA Hall of Famer
sum to the airlines, you may as well kill two birds with one stone. As the weather was hot and steamy, Imogen made a beeline for the pool, ofset on occasion with trips to the cool of the mall.
Robin and I, on the other hand, made various forays to art museums, galleries and the like. Some were jaw-dropping; the Hunter Museum in Chattanooga has an exhibition of Monet and American Impressionists – stunning. Other visits turned into wild goose chases, like the Fisk here in Nashville’s Carl Van Vechten gallery was closed for renovations with no mention on their website. The so-called
ably 20 years and the shops selling pictures are mostly located upstairs away from the view of passers-by and most were closed anyway in spite of it being a busy weekday. I’ve been in a cleaner souk bazaar in Morocco! It’s a wanna-be art district with no real conviction of ever being so, either by the owners or the tenants.
Art District on Fifth Avenue in Nashville’s downtown, touted as a mecca for new artists and cool galleries turned out to be a shabby, grungy disappointment; most of the “galleries” (term used lightly) are housed in a two-story arcade linking 4th and 5th Avenues. The arcade is principally home to eateries and shops that have seen better days with odors providing no invitation to dine. The place hasn’t seen a lick of paint in prob-
CR R O O S S W D
By Miles Mellor
To make up for the disappointment we turned to booze and spent a day and a half on a mini Bourbon Trail tour of some central Kentucky distilleries. For years my nightcap of choice was Scotch whiskey until someone introduced me to Maker’s Mark bourbon and I’ve been taking an evening nip ever since.
Robin, me and a good friend, Doug, drove to Bardstown on Sunday afternoon for an early assault the next morning. Now, I don’t know what preconceptions you may have of a small town in central Kentucky, which to all intents and purposes, probably owes its existence to the bourbon industry, but
Sponsored
Legendary Corvette tuner
I was floored. I was expecting a small string of retail, bourbon related shops and stores selling anything from tea towels and tofee to tee shirts and trinkets to the passing parade of tourists –a bit like Gatlinburg. Bardstown is, without a shadow of doubt, one of the prettiest, neatest, well-kept cities in these United States. Georgian houses and shops, banks and stores are presented in picture-book perfection with an air of aging self-dependency. This is no Williamsburg-style mock up but the real living, breathing thing. It’s beautiful. Go there and see for yourself. You won’t be disappointed and you don’t have to drink bourbon.
Talking of which, the tours of the distilleries is a worthwhile pastime. I learned all kinds of fascinating information of which I had no previous idea.
The tour guides are friendly and full of amazing facts about the production, aging and storage of their products, going into minute detail as to why their bourbon is diferent to others. The smell of the places is, of course, intoxicating, with wafts of mash fermenting in the background – a warm welcome if ever there was one.
The monolithic barrel stores are an amazing testament to the insightful engineering of years gone by. They were and still are made of red oak throughout – the walls, the racks, the floors, everything. They are literally living, breathing buildings holding nothing but natural products. To qualify as bourbon no additives can be made to the mixture except the water and grains.
I think we saw more art in the whiskey making than in the galleries in Nashville.
1. Cadillac sedan
3. Grand Cherokee or Wrangler
5. Granada or Tempo
10. Makers of the Asterion LPI 910-4
11. Transportation Dept., abbr.
12. Jaguar luxury grand tourer
13. Mid-size car from Saturn
14. VW large family car
15. Model T, e.g.
16. Lease alternative 17. Compact SUV from Isuzu
18. Keyword in Subaru ads
19. It’s the loneliest number 23. It makes for a jolting ride 24. Lotus convertible 26. Koenigs___ 28. 2003 Will Ferrell holiday movie 29. Road built for speed 32. Circle ratio 33. Shelby’s state
Honda SUV 37. Hyundai sedan
Doggie doc
Braking system 40. Many vehicles can now self ___
Jealousy
‘86 Suzuki
XKE maker
Autos have to be tested for these 6. Cutlass and EightyEight makers 7. Fairlady or 240Z 8. Thrill
9. Often the age when a kid wants a car for their birthday
Steelers’ state 15. Big name in Minis 20. Time for headlights 21. Mechanical and design expert 22. QX60 or Q70 23. Air conditioner capacity, for short 25. 1920 Belgian auto 27. ___ your seatbelts!
Former sports car from Toyota
Drags
Sun’s output
Dark blue color
Driving with the ___ down
List your cars, trucks, rvs for sale FREE. www.bargaincommunity.com
5th
CAR & FINANCE. Turn-key operations. 22 years. Retiring. Madison Hts., Mich. $70,000. 248-396-0475 house. 4 bays plus paint
Deadline
October 5
Compliance
October 19
Dealer Management Software
Deadline ThursdayOctober 8
November 2
Dealer Life [BHPH Spotlight Advertorial]
Deadline Thursday, October 22
November 16
Factory Focus
Deadline Thursday, November 5
December 7
Tax Season Preview
AROUND THE BLOCK
AUCTION FUNDS SERVICE DOGS FOR VETS
Dealers Auto Auction of the Rockies held its 5th Annual Live Charity Auction this summer. With the help of customers and employees, DAA Rockies raised over $16,000 to support the work and mission of Freedom Service Dogs of America.
“The generosity of our custom-
ers and employees for our annual charity auctions and the local charitable organizations we support continues to amaze us,” said Alex Zyla, marketing manager. “We surpassed last year’s fundraising goal by $3,000.”
“I am proud to work in an industry where the people really care
about giving back to their community by supporting organizations like Freedom Service Dogs of America.”
Freedom Service Dogs of America provides a second chance for a normal life to two communities in need: disabled veterans and abandoned dogs.
Customers and employees gathered in the lanes after DAA Rockies’ sale to bid on over 40 donated items at the event. Cargo, the Freedom Service Dogs of America’s mascot, showed off his training throughout the day.
“Dealers Auto Auction of the Rockies created an amazing charitable day for Freedom Service Dogs,” said Stacey Candella, marketing manager for Freedom Service Dogs. “The incredibly generous dealers came together and raised over $16,000 to support a service dog for a military veteran on our wait list.”
Compiled by Jeffrey Bellant
Events Support Children’s Charity
ADESA and PAR North America were proud sponsors of two charity golf tournaments this summer, both benefiting organizations that are focused on helping children in need.
The Swing Fore A Child’s Place Golf Tournament, held at River Run Country Club in Davidson, N.C., is an annual event that supports A Child’s Place in Charlotte, N.C. A Child’s Place works to erase the impact of homelessness on children and their education.
This year’s tournament raised a record $156,000, and those funds will be used to provide resources to help the 150-plus homeless children.
“ADESA and PAR were a huge part of this year’s success,” said event coordinator Jennifer Sidden. “And we are so grateful for their support. It truly makes a diference for children experiencing homelessness in Charlotte.”
We invite news items and top-quality photos from our readers to be considered for “Around the Block.” Please include the name of a contact person and a telephone number. Send items and photos to: Jeffrey Bellant. Mail: Used Car News, 24114 Harper Ave., St. Clair Shores, MI 48080. Fax: (586) 772-9400 e-mail: jeff@usedcarnews.com
WOMAN’S BEST FRIEND: Lindsay Granassa, from left, and Stacey Candella of Freedom Service Dogs of America, pose with Cargo, the charity’s mascot during a sale at DAA of the Rockies.
When customers sell you to other customers, you’re doing something right. Sharing a passion for this business is what we’re all about. So we couldn’t have been more thrilled when we heard what David Kelleher did to help his friend Cass Burch reach his fullest potential: he flew to Cass’ store to sell him on the benefits of Ally SmartAuction®. Further proof that when you love what you do, it’s nothing short of contagious.
