FREDERICK, Md. -

When considering auction units sold, dealer consignment and commercial consignment have been heading in opposite directions the past three years. In its 2012 Annual Review, the National Auto Auction Association looks at what’s behind this trend as well as its implication in the lanes.

First, the statistics.

According to NAAA survey data looking at auction units sold by source, dealer consignment climbed 4.7 percent in 2010, followed by 10.8 percent growth in 2011 and 13.7 percent growth last year.

Meanwhile, commercial consignment fell 14.7 percent in 2010 before dropping 22.2 percent in 2011 and 8.4 percent in 2012.

“Total auction volume is less related to current economic conditions than new-vehicle sales,” NAAA’s report reads. “While dealer consignment closely follows new retail unit sales, the number of commercially consigned (fleet, off-lease and manufacturer) vehicles offered and sold currently at auction is dependent on the new units sold in the past.”

As the data indicates, the end of the recession began a rise in dealer consignment and a downturn in commercial consignment, NAAA indicated. Interestingly enough, the report points out that in 2010 and 2011, the declines in commercial volumes “more than offset” the gains on the dealer consignment side.

Then things changed last year.

“In 2012, a 13.7-percent increase in dealer consignment more than offset an 8.4-percent decline in commercial consignment and total units sold at auction increased 3.3 percent,” the report stated.

The data also provides a year-by-year look at the share of auction unit sales by source.  Similar trending is spotted here.

Back in 2009, commercial consignment represented 61 percent of auction unit sales, whereas dealer consignment was at 39 percent — an all-time low.

Since then, the share of auction sales commanded by dealer consignment has crept upward: it represented 44 percent of sales in 2010, 53 percent in 2011 and 58 percent in 2012. The latter figure was an all-time high.

Conversely, commercial consignment’s share has gone from 61 percent in 2009 and fallen to 56 percent in 2010, 47 percent in 2011 and 42 percent last year.

“This diversified sourcing increases the stability of the auction industry and helps it weather difficult economic conditions,” the report noted. “However, it also holds back industry growth when new sales recover and dealer consignment increases, but commercial consignment declines to past weak new sales.”

Explaining how dealer consignment shot up to a record high last year, NAAA pointed to the “pickup in new sales.”

Conversely, it said of commercial consignment: “Past weakness in new light-vehicle sales was reflected in share declines in the commercial consignment share of auction unit volume to 42 percent in 2012.”

Positive Signs for Business

In the introduction to the review, NAAA emphasizes two key trends that should leave those in the auction business feeling confident.

For starters, the auction industry had its first volume increase since the slide that started in 2008. Specifically, the number of cars arriving on auction lots jumped 6.4 percent. What's more, auctions moved 7.9 million units — representing $72.7 billion.

“That's not just a light at the end of the recessionary tunnel — that's an exit sign,” NAAA noted.

Elsewhere in the review are not only indicators of the business climbing last year, but signs that in 2013, the auction industry will be “substantially improved.”

And as noted in the introduction, the businees can take heart in the fact that even in a rough economy, an average NAAA member auction includes an eight-lane facility on 79 acres. What's more, the average NAAA auction has 140 employees representing a $3.4 million payroll, the report noted.

NAAA also emphasizes that these auctions have combined to sell 145 million units since 1997, the first year of data included in the review.

Editor's Note: NAAA's Annual Review was prepared by the association with assistance from the National Automobile Dealers Association and the National Independent Automobile Dealers Association.

Joe Overby can be reached at joverby@autoremarketing.com. Continue the conversation with Auto Remarketing on both LinkedIn and Twitter.