The automotive industry continues to evolve at a remarkable pace. Every operator, from independent dealerships to large retail groups, is challenged to run leaner, think strategically, and protect enterprise value. The same holds true in the wholesale auction sector, where efficiency, transparency, data discipline, and optimizing use of technology now determine who leads and who follows.

During a time marked by consolidation, one principle remains constant: performing consistently and optimally is never accidental, it calls for structure, insight, and execution.

The market reality: Scale requires structure

Wholesale auctions remain essential to the flow of inventory and liquidity across the automotive ecosystem. Yet the landscape is shifting fast.

According to the mid-October 2025 update of the Cox Automotive Manheim Used Vehicle Value Index (MUVVI), wholesale used vehicle prices decreased month-over-month, with the index falling to 203.6. Although prices remained slightly higher year-over-year. This trend, coupled with low consumer sentiment and rising interest rates, suggests a challenging Q4 for retail absorption with potential slowdowns and the need for price adjustments, while wholesale operations face increased depreciation and shifting conditions favoring buyers.

These numbers indicate that auctions must operate more effectively to maintain their profitability. Reliance on instinct, legacy systems, or inconsistent data often leads to missed opportunities and coming up short on P&L projections. What is worse, without a disciplined framework for performance tracking, process control, and reporting, even well-run operations can quietly erode profitability over time.

Achieving and maintaining profitability depends on operational effectiveness — identifying and correcting the small inefficiencies that can compound into significant losses.

Operational excellence: The core of sustained profitability

In today’s environment of compressed margins, volatile floorplan costs, and shifting dealer behavior, wholesale auction operators must run leaner, smarter, and with more intention than ever before.

I know that from firsthand experience: I founded Auctions In Motion (AIM) launched it as a mobile auction platform, scaled it into a network of brick-and-mortar locations, and ultimately sold it to America’s Auto Auction Group (formerly AAAG/XLerate). I know how hard it is to balance “working in the business” at the same time as “working on the business.” The discipline required to perform at a high level every single day can be demanding, especially while trying to keep an eye on the larger market forces that shape the industry and influence your business.

Looking back on how we built and ultimately sold AIM, I gained valuable insights along the way. At Mach10 Automotive, those lessons have evolved into guiding principles that help dealership and auction principals strengthen performance, improve efficiency, and safeguard enterprise value. Below are seven practical principles every wholesale auction operator can apply today to safeguard performance and protect profitability.

  1. Measure what matters most

Even small inefficiencies — from slow turn times to lane underutilization — can erode margin.

  • Track throughput KPIs frequently (weekly/daily) (vehicles sold per lane hour, recon cycle time, arbitration rates).
  • Benchmark labor productivity against peers and historical averages.
  • Tie compensation to measurable outcomes that impact margin directly.

Goal: Replace intuition with data-driven discipline.

  1. Optimize recon and transport cycles

Idle inventory is lost capital.

  • Build vendor partnerships to reduce dwell time.
  • Use scheduling software to coordinate movement.
  • Consider partial in-house capacity if third-party bottlenecks persist.

Goal: Every extra day a vehicle sits idle costs money; for the auction house and the consignor.

  1. Manage floorplan and cash flow proactively

Fluctuating rates make liquidity management critical.

  • Enforce time limits on aged inventory and floorplan exposure.
  • Use dynamic pricing or early-sale strategies for slow-moving units.
  • Monitor capital utilization weekly.

Goal: Liquidity and velocity are the lifeblood of wholesale.

  1. Protect your consignor and buyer base

Volume is relationship-driven.

  • Segment consignors and tailor reporting and communication.
  • Offer loyalty incentives for top buyers.
  • Maintain transparency to build trust leading to repeat business.

Goal: Treat relationships as tangible assets — because they are.

  1. Invest in Digital Capability

Hybrid marketplaces are here to stay.

  • Prioritize user-friendly, reliable online bidding experiences.
  • Maintain strict imaging and condition-report standards.
  • Leverage analytics to anticipate buyer demand and run-list optimization.

Goal: Blend digital reach with operational credibility.

  1. Build Risk and Compliance Discipline

Operational blind spots can become six-figure problems overnight.

  • Audit title and lien processes regularly.
  • Stay current on regulatory requirements and environmental standards.
  • Review insurance coverage annually.

Goal: Prevent small errors from becoming big liabilities.

  1. Empower leadership and accountability

Structure matters — but culture sustains it.

  • Train supervisors to spot and fix inefficiencies early.
  • Reinforce accountability at every level.
  • Recognize teams for process improvements and measurable gains.

Goal: Precision and culture together protect profits.

Advisory perspective: Prepare now, not later

Operational effectiveness is only half the equation — the other half is strategic readiness. Too often, auction owners begin thinking about succession or a sale only when the decision is imminent, missing critical opportunities to strengthen value drivers well in advance.

The most successful transitions share key characteristics:

  • Financial clarity: Clean, verified financials inspire buyer confidence.
  • Operational consistency: Documented processes and reporting reduce perceived risk.
  • Leadership continuity: A strong management team reassures acquirers and sustains performance.
  • Reputation management: A respected, trusted brand commands premium valuations.

Whether your path leads to a generational handoff or a sale, preparation should be a daily discipline. By operating with transparency, structure, and foresight, auction leaders not only improve day-to-day performance, but they also ensure their business remains ready for any opportunity that arises.

The road ahead

Market consolidation continues to reshape competition. Digital transformation is accelerating, and consignor and buyer expectations are evolving quickly. Scale will favor those who operate with structure, data integrity, and operational precision, but independence remains a powerful advantage when paired with focus and adaptability.

For independent auction owners, the path forward demands clarity, preparation, and execution. Strengthen the fundamentals. Modernize technology. Align leadership around measurable performance goals. Whether you aim to grow, transition, or sell, a lean, data-driven, well-documented operation will protect enterprise value and expand your options.

At Mach10 Automotive, we believe success in the next era of wholesale auctions won’t be defined by size and volume alone, but by discipline, insight, and readiness. Those who act now to optimize performance and prepare strategically will not only weather the changes ahead, but they’ll also define the future of wholesale automotive auctions.

George Pero is an accomplished leader in the automotive industry. George began his career in the automotive retail sector, where he held various management positions. George’s career achievements include successfully launching, operating, and selling Auctions In Motion (AIM), a regional mobile auction company that brings the auction to the dealer. George has extensive knowledge and expertise in mergers and acquisitions in the automotive sector, having overseen more than $1 billion in transactions. His sales and general management experience coupled with his success in M&A activities led George to establish Mach10 Automotive, a dealer advisory firm offering a suite of services to include dealer performance improvement, succession planning, and M&A.