SmartAuction Announces Special Buyback Guarantee on Avis Units at NRC

By Jennifer Reed, Auto Group Editor
November 04, 2009

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LAS VEGAS — In breaking news at the National Remarketing Conference Tuesday, SmartAuction announced that starting today it will offer dealers a special buyback guarantee on all Avis vehicles purchased through its online auction platform.

This offer lasts through the end of January and gives dealers 10 business days from the day of purchase to make sure the vehicle lives up to the details disclosed.

Once the unit arrives at a lot, if a dealer finds the unit is not as it was described, Mark Newman, of SmartAuction, explained to Auto Remarketing that his company will buy back the vehicle from the dealer.

Why is the company providing this special deal? Basically, Newman said SmartAuction understands that some dealers may have some reserves about purchasing rental units. They tend to have higher mileage. In essence, this guarantee is designed to offer a bit of extra peace of mind.

"We are able to offer this buyback guarantee due to our very prosperous relationship with Avis. We think Avis is a very trusted consignor. We want to offer dealers the high assurance above and beyond what we traditionally offer," Newman explained Tuesday.

Overall, SmartAuction is having a record year. While in the past, the company has been typically associated with General Motors rental and GMAC off-lease vehicles. SmartAuction has been opening its platform up to more makes and dealers, and has apparently been finding much success.

In fact, when GM and GMAC vehicles are excluded, on a year-over-year basis, the company has shown about 40-percent growth year-over-year, Newman pointed out.

He went on to point to three primary areas of growth. These areas consist of rental volume, dealer to dealer and financial institution business.

When it comes to rental business, as OEMs have been pulling back on their program vehicles, the rental companies have taken on more risk and responsibility for remarketing these vehicles and this has resulted in an increase in volume for SmartAuction.

"These companies are looking for efficient channels," Newman pointed out.

Next, looking at the expansion in dealer-to-dealer volumes, he indicated that as dealers have been reducing their days-to-turn, or days in inventory, they have been more willing to wholesale a unit if it is not sold within a set period of time.

"We believe our channel is one of the most effective," Newman said.

As an added benefit, once a unit in inventory reaches a certain age, or number of days on the lot, some dealers are apparently uploading the model to wholesale via the auction platform, while simultaneously retaining the vehicle on their lot in hopes of a retail deal.

And finally, SmartAuction has been seeing growth through its financial institution volumes. This volume includes both off-lease and repossessed units.

"In an emerging trend, financial institutions are more comfortable remarketing repo units online," Newman noted.

And as auction volumes remain relatively tight throughout the country, more dealers are turning to online venues to find the units they need to replenish inventory, he added.