Auction Buzz

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Can You Keep A Secret…..

 
When you hear me speak about the Formula…..
The Auto Arbitrage Formula…..
You know I’m talking about Market Inefficiencies…..
Taking advantage of prices between different markets……
Buying in one geographic location and selling them in another…..
Then making a profit…..
That profit is the difference between those locations…..
But…..
Repeating this…..
Over and over…….
Takes information…..
As I have said in the past…..
Most of this information is public…..
-Market reports…..
-Sales stats….
-Expert predictions 30, 60, 90 days out…..
All tools that will keep you current…..
All tools that give you an indication of what cars are worth TODAY !!!
Then…..
There are secrets…..
Secrets you learn everyday…..
If you pay attention.
As I was standing in line to turn in titles at last Tuesday’s live Manheim Auction…..
I began talking to the dealer in front of me Who I know to be an exporter…..
He has bought a lot of cars from me over the years…..
From past conversations, I know where he ships to…..
We were in line for maybe 15 minutes…..
So…..
I began by asking him what he was buying…..
Many of the things he told me I already knew…..
What manufacturers…..
What models….
What model years…..
What equipment…..
A couple of the models he mentioned, I wasn’t aware of…..
2012 Ford Escapes for one…..
2012 Ford Focus’ ( only 4 doors ) for another…..
But…..
The SECRET…..
The secret he told me is what is being taken OFF THE LIST !!
A number of countries that import U.S. cars, trucks, SUV’s, and vans will only accept models that are 6 years old or NEWER…..
That translates to 2011 and up…..
Normally…..
As the calendar year comes to a close……
Usually by November…..
It changes to 2012 and up…..
For some reason…..
This year…..
That time frame got moved up ……
To June 30th…..
ALL the 2011 models that are in the current market reports…..
And ALL the 2011 models that WERE on the shipper list…..
BOOM !!!
They won’t buy ’em……
What does this do to the price?
It won’t be clear for at least 90 days……
I’ve seen the price drop be as much as $1500.00/unit in the past…..
I’m staying away from them for awhile
Til the blood bath is over……
Til everybody knows the secret.
 
 
Since 1955…..
Black Book, a division of the Hearst Business Media Corporation…..
Has put out a line up of innovative products and services for dealers…..
-New and Used vehicle value services…..
-Customer data licensing solutions…..
-Lender origination and risk analysis…..
With online and mobile technologies reshaping the dealership business model…..
Black Book has remained a step ahead…..
By enhancing the customer experience…..
And building the highest quality lead generation solutions for dealerships nationwide.
They publish a monthly “Black Book Market Insights” report that tracks industry wide sales of ALL vehicles…..
In that monthly report :
“They review volume weighted data”
“And overall car segment values”
“And depreciation levels”
right down to the 00.01%……
Both NEW and USED car managers are able to make weekly adjustments to trades…..
To keep prices in line on an ever depreciating asset.
But…..
The BEST feature in the report is the people……
People in the LANES…..
People in the lanes at auctions from coast to coast……
That contribute to the Insights Report with actual DIALOGUE…..
About what they’re hearing directly from dealers selling every week.
Things like:
“A New Car Dealer says that they are keeping most of their trades in inventory”
In another area:
“Consignment is still down here, with more buyers than sellers”
And another area saying:
“The trend of softer values is continuing here”
“No sale’s were higher in the dealer consignment lanes and the vehicles that did sell had low prices”
And on and on like this…..
Until every section of the country is heard from…..
Voicing every pertinent concern…..
I LOVE that…..
It allows you to FEEL what’s going on all over the market…..
You can SENSE when prices are going up OR down…..
You can SENSE when inventories are expanding or contracting…..
And unlike market reports that only show you what sold…..
You can SENSE what is NOT selling…..
You can FEEL the real struggles…..
As long as Anil Goyal and his team at Black Book never drop that service…..
I’ll be a customer for life…..
 
 
Speaking of struggles…..
June is shaping up to be just that…..
I dare say…..
We are on track to a 55% sales rate for the month…..
There is a general contraction across the board in dealer consigned cars…..
Which should be good for prices…..
But…..
Buyer levels are down…..
Hence…..
No Sales are up…..
If you have to take in trades that are NOT :
-really clean…..
-low mileage for the year…..
-And scarce…..
Use extra caution and be sure to factor in the depreciation from WEEK TO WEEK !
There are going to be older, super high mileage units that have virtually NO VALUE…..
That”s right !
If nobody will stroke a check for ’em, they’re worth nothing…..
Salvage prices at best !

 
It appears OVE.Com is going to save the month…..
Here we are on pace with last month…..
Around a 30% sales rate…..
Now…..
30% doesn’t sound all that great…..
Until you examine each individual deal…..
There you will find that our profit margins are strong…..
OVE.Com total views are way down…..
But with more of a “worldwide” audience…..
We are able to reach areas where demand is there…..
If you would like help making this a profit center for your dealership…..
Contact us…..
Rechtschaffenmotors@gmail.com
We can set it up for you……
If you are still not doing the steps to get your vehicles properly listed and up on line…..
We thank you !
More buyers for us…..
 
Out for now,
 
Barry J.Neuman
Member of Manheim’s “Superseller” Club