Manheim Riverside plans on closing out the month of January with a bang via its One Hundred Grander Sale on Wednesday.
Beginning at 3 p.m. PST, lanes one and two will feature more than 100 vehicles listing for $100,000 or more. The sale will include vehicles from several luxury brands, including Aston Martin, Bentley, Ferrari, Jaguar, Lamborghini, Maybach, Porsche and Rolls Royce.
A reception will welcome customers, starting at 2 p.m., with appetizers, sushi and beverages at the auction’s location at 6446 Fremont St. in Riverside, Calif., where the auction hosts its regular weekly sales every Tuesday and high-line sales every other Thursday.
The auction will host a customer dinner at the Mission Inn’s Music Room in downtown Riverside following the sale.
Door prizes will be available for the first 250 dealers at the auction’s 27th anniversary sale on Thursday, as well.
Michigan’s own Flint Auto Auction will host its inaugural sale featuring vehicles from Chrysler Capital and Santander Consumer USA on Feb. 11. The sale, which the auction expects will include 100 units, will run vehicles for the account every other week.
“We are delighted to welcome Chrysler Capital/Santander Consumer USA to Flint Auto Auction,” said John Luce, Flint’s co-owner and vice president. “Santander Consumer USA is one of the largest vehicle remarketers in the country, and consistently offers a great mix of vehicles. We know they’ll attract a tremendous amount of attention in the lane, particularly with the Santander 7 certification program. There is also a ready market here at Flint Auto Auction for the Chrysler group off-lease vehicles, which are certified to meet even the most exacting standards of the buyers in the lanes.”
In Georgia’s oldest city, the Southeastern Auto Auction of Savannah wrapped up its Grand Re-Opening and $10,000 Cash Giveaway Sale on Wednesday. The auction event was the first Southeastern has hosted after three months of renovations and ended up breaking all of the auction’s previous records by featuring over 900 consigned vehicles and over 500 attending dealers.
Following the sale, three dealers got a piece of the $10,000 giveaway, including Vaden Chevrolet ($5,000), JAK Auto Sales ($3,000) and Redding’s Auto Mart ($2,000).
“I want to thank every dealer who helped make this the most successful sale in Southeastern Auto Auction’s history,” said Bill McCready, the auction’s vice president. “I also want to thank the SEAA team, which I am very proud of.”
SEAA hosts its dealer-only sales every Wednesday at 10 a.m. EST and its public sale every Thursday at 7 p.m. EST.
In the Valley of the Sun, Dealers Auto Auction of the Southwest down in Phoenix announced the completion of its mobile operating system, Sale Day Mobile, which not only gives dealers access to auction data streams, but also enables the use of mobile technology prior to and during auction sales streamline both online and in-lane functions.
“When you have a vision and partners like WTG and the Web Guys, you can accomplish anything you want,” said Stephanie Gingras, auction general manager. “In conjunction with our partners’ software, iPads check-in, image, [provide] condition reports and upload all that data wirelessly to our website, our server and to AutoIMS.”
DAASW says it has put mobile devices at the disposal of all key operating staff, including lane leaders, while also providing them with email address to communicate both internally with staff and externally with dealers.
For more information about DAASW, visit its website.
The ServNet Auction Group announced the recent expansion of its family of auctions with its 32nd auction location, Brasher’s Fresno Auto Auction. The California location was recently purchased by the Brasher family and hosted its first Brasher’s sale on Friday, Jan. 16.
“It is with great pleasure that we welcome the newest member of the ServNet Auction Group,” said Patty Stanley, ServNet’s president. “Expansion from within is indicative of the strength and vitality of our member auctions, and we’re excited to extend our footprint into this thriving automotive market.”
Family business member and president of Brasher’s Sacramento, John Brasher, says he’s looking forward to expanding the business’s market presence to help dealers in the Fresno area, with the new addition retaining the leadership of its founder, Larry Champagne, who will remain at the location as the general manager.
“The Fresno auction is a great opportunity for us and we’re looking forward to working with Larry and the great team he has put together,” Brasher said. “With more than 40 years in the central California auto business, as both a wholesaler and used car dealer, Larry is a great asset to us and we know we’ll benefit from his experience and knowledge of the market. The auction is a great location, with a tremendous potential for growth, and we anticipate developing another great Brasher’s auction in Fresno, following the regional model we established with such success several years ago at Brasher’s San Jose Auto Auction.”
The auction will host its weekly sales every Friday at 10 a.m. PST while also hosting Brasher’s weekly UVA BookSheet Sale every Thursday at 12:30 p.m. PST. For more information about Brasher’s Fresno Auto Auction, visit its website.
KAR Auction Services announced Wednesday morning that chief executive officer Jim Hallett has been named chairman of the board of directors.
Making the announcement was Ryan Birtwell, who is the chair of the Nominating and Corporate Governance Committee at KAR.
“Jim was a natural fit for this role, given his extensive industry experience and professional insights,” said Birtwell. “This experience balances nicely with our new, independent board members and their diverse backgrounds and talents. Jim’s leadership skills will foster strong collaboration and decisive action for the company.”
Hallett’s time with the KAR family dates back to 1993 when he was named president of ADESA Canada, becoming president and CEO of ADESA three years later.
Hallett served as president of Columbus Fair Auto Auction from 2005 to 2007 before coming back to ADESA as president and CEO in April 2007. He has been CEO of KAR since September 2009.
“I am incredibly honored to lead the KAR group of companies and our team of talented and dedicated people,” said Hallett. “I look forward to continuing our successful history of innovative growth and am energized by this new opportunity.”
ADESA announced Friday afternoon that it has realigned its dealer services division, which will be led by Keith Crerar.
The team will include a few new members who will be regional dealer sales managers and regional online sales managers, while three existing positions will stay the same: Steve Dudash as executive director of major dealer accounts, Wendy Kirkwood as director of dealer sales operations, and Doug Hadden as director of training.
All will report directly to Crerar, who reports directly to Jason Ferreri, ADESA senior vice president of commercial sales.
As for the regional dealer sales managers and regional online sales managers, they’re listed below:
Eastern Region:
— Kathy Hopkins, regional dealer sales manager, who has been with ADESA 17 years.
— Joe Caruso, regional online sales manager, who comes over from ADESA Concord, where he spent more than five years as a commercial account representative, operations, dealer sales and his latest position of online sales.
Western Region:
— Shayne Ridley, regional dealer sales manager, who has been with ADESA and OPENLANE for nearly 10 years.
Sharing more about Crerar’s experience, ADESA noted that he became part of the company’s newly Formed dealer sales and services corporate sales team in 2009, taking a position as central region dealer sales manager.
Upon ADESA’s purchase of OPENLANE in 2011, Crerar took on duties heading up the online field sales team before a promotion to regional dealer sales director for both ADESA and OPENLANE.
His latest position was as executive director of dealer sales and auction e-business. Before his ADESA days, Crerar worked in dealership groups in Ontario for nearly a decade. In Crerar’s new post, he will head up ADESA’s dealer sales and services division, which has more than 300 employees and focuses on such areas as supporting dealers’ wholesale auction needs and providing business support, analytics and training. That includes ADESA online offerings, as well.
“ADESA is committed to investing in the people and resources necessary to best support our dealer customers,” said Stéphane St-Hilaire, ADESA chief executive officer and president. “This includes having the right people on board, people with proven track records in retail automotive. Keith has the experience, the perspective and the relationships to direct our dealer services division.
“In addition, aligning all of our company’s sales and service teams enables us to deliver more personalized solutions for the unique needs of our diverse customer base,” he said.
Ferreri added: “Keith was a natural fit for this position with his diverse industry knowledge and expertise in the dealer space. I look forward to working with him as we further enhance the customer service experience — both in the auction lanes and online.”
Headlining a list that included such well-known companies such as Apple and Starbucks, Copart topped The Exceptional 100 list released by Deloitte this week, a ranking measured by Deloitte’s new proprietary method that examines a company’s overall economic performance including profitability, growth and shareholder value.
A list of 100 U.S.-based, publicly traded companies were identified as top performers, and Copart beat out other firms such as McDonald’s, Ralph Lauren and Coca-Cola.
“Copart is excited and honored to be at the top of The Exceptional 100 list,” Copart chief executive officer Jay Adair said. “It was our founder Willis Johnson’s vision that set the frame work for the company we have become, as well as our 4,000 employees worldwide who continue to innovate and lead our business each day.”
Deloitte explained that The Exceptional 100 is based on three features of financial performance analysts contend are often overlooked:
— Financial performance is multi-dimensional: The approach embraces the idea that profitability, growth and value all matter, and so it evaluates company performance across all three dimensions simultaneously.
— Relative performance matters: Deloitte compares any company against the full population of publicly-traded companies, adjusting for industry and size. According to Deloitte, this is potentially a much more robust approach to performance benchmarking than many companies tend to use.
— Chance must be separated from skill: A single year’s results rarely reveals much about a company’s sustained performance, but what is the right time period over which to measure performance? The Exceptional 100 uses advanced statistical analyses and modeling techniques to determine how well a company needs to perform, and for how long, to be quantifiably “better than lucky.”
Copart topped The Exceptional 100 list with sterling performance on all seven measures and an average exceptional streak of 16 years. Its probability of being exceptional on value is 100 percent and its average probability across all measures is over 96 percent.
“When I look back at starting the company more than 30 years ago, failure was never an option,” said Willis Johnson, Copart’s founder and chairman of the board of directors.
“What I was doing wasn’t work. It was a labor of love. I surrounded myself with other people that felt the same way,” Johnson continued. “The vision was always to make this company more than what it was when we started out. To see that come to light and be recognized for our performance and growth over the years is truly humbling.”
Two other companies with direct connections to the used-vehicle industry made The Exceptional 100 list as well.
Credit Acceptance Corp. — one of the top 10 market share holders in used-vehicle financing — came in No. 86.
America’s Car-Mart — a network of more than 130 buy-here, pay-here dealerships throughout the Southeast — landed at No. 95.
“Current methods of evaluating corporate financial performance can be unnecessarily incomplete and disconnected," said Michael Raynor, director at Deloitte Services, and one of the lead researchers on the project. “There are essentially three ways in which a company can deliver exceptional outcomes: through profitability, through growth and through shareholder value.
“Although it is useful to know where a company stands in each of these measures individually, we believe truly exceptional companies have beaten the odds over a period of time, and have consistently outperformed on multiple measures simultaneously,” Raynor continued.
“Understanding each of these elements is critical to setting and achieving appropriate performance improvement targets,” Raynor went on to say. “Because there is no one measure of financial performance that captures everything that matters, managing financial performance means understanding how well a company is performing on multiple dimensions in order to determine which elements need improving.”
According to the companion research report, “Charting Superior Business Performance,” co-authored by Raynor and Mumtaz Ahmed, chief strategy officer at Deloitte, understanding relative performance is both critical to successfully improving performance and widely misunderstood.
“Our research found that up to 80 percent of managers either over or underestimate their company's relative performance or percentile rank,” Ahmed said. “This misunderstanding can lead to misplaced efforts, such as an unnecessary focus on aggressive cost-cutting, as opposed to increasing margins through strategic differentiation to improve long-term profitability.
“Our hope is that The Exceptional 100 study will help managers better understand this critically important dimension of their performance and will help them better focus their performance improvement efforts,” he added.
Raynor reiterated a single-year’s results are rarely significant to observers of corporate performance and there is little agreement on the time period over which stand-out performance reveals itself.
“It’s common to pick three, five, 10 and even 20 years,” Raynor said. “But these choices are needlessly arbitrary. Our statistical method uses modeling techniques that allow us to infer more meaningful time periods that are specific to each performance measure.
“As a result, we can identify those companies that are quantifiably likely to be ‘more than just lucky,’” he concluded.
This year began with Auto Remarketing and Wall Street observers peppering Manheim’s Tom Webb with questions about rising off-lease volume, which has a projected level of about 2.5 million that the auction company’s chief economist called, “average.”
Webb made that vanilla assessment of off-lease volume expectations because the industry pushed significantly more than 2 million units a year through that wholesale channel between 1998 and 2010, according to Manheim’s data.
“Off-lease volumes have been the top story in the industry for some time now. To a certain extent, it’s been a story that gotten ahead of itself I believe,” Webb said. “Sure, we’ve had some nice percentage increases. But it is off a ridiculously low base. Last year’s off-lease volume was the fourth lowest in the past 20 years.”
So what story should Auto Remarketing and investment analysts be watching?
“The real off-lease story is a couple of years from now. I just hope I’m around to report it because for the most part it’s going to be a good story, especially when we consider it from a retail aspect,” Webb said last week when he conducted his first conference call of the year.
“Up until now the recovery in new-vehicle sales has been driven by pent-up demand. By definition, that is not a sustainable force,” he continued. “We now have the opportunity to transition to an industry where current sales are supported by returning lessees. And not just any type of returning lease customer; it’s a satisfied one.
“That pretty much describes utopia from a dealer’s perspective,” Webb went on to say.
By 2018, Manheim is projecting off-lease volume and new-vehicle lease originations to set new highs with dealers originating nearly 4 million leases and auctions seeing more than 3.5 million units going down the off-lease lanes.
“One of these days I believe the experts will realize that leasing can protect residual values, not just destroy them,” Webb said.
Price Stability
As reported by Auto Remarketing last week, the Manheim Used Vehicle Value Index — a measure of wholesale prices adjusted for mix, mileage and season — came in at 123.9 to close 2014, a 1.8 percent uptick from a year ago and 2.1 percent higher than the third quarter. Webb pointed out the reading represented the least volatility in wholesale pricing for a four-year span since the index inception in 1995.
“To be sure, a lot of macroeconomic and industry factors are contributing to that stability,” Webb said. “But I think we also have to give credit to better and more efficient remarketing practices, which enabled the commercial consignors to anticipate, respond to and thus minimize impending swings in wholesale pricing.”
If the industry were to rewind back 13 years — before the days of sophisticated online sales and more technological advances — Webb would have offered a dark wholesale price forecast.
“If we had the same processes that we had in 2002, I, too, would be worried about a collapse in wholesale pricing. We do not, so I am not,” he said.
High-Mileage Rental-Risk Units
Manheim reported average prices for rental risk units sold at auction in December rose on both a month-over-month and year-over-year basis.
“After adjusting for broad changes in mix and mileage, prices for rental risk units have moved in a fairly narrow range over the past four years. Achieving that stability last year was no small feat, given the disruptive forces of harsh weather early in the year and massive manufacturer recalls throughout the year,” Webb said.
Also of note, Webb mentioned the number of rental risk units sold at auction in December was considerably higher than the low level of the previous year.
Furthermore, average mileage soared to a new high with December topping the 47,000-mile mark. Many of the exceptionally high-mileage units sold in December were concentrated in the minivan and sports car segments.
“Both categories handled the higher mileage with little impact on pricing,” Webb said. “If you look at some of the prices that these vehicles got and compared them to what they were getting with 40,000 miles versus 50,000 miles, dealers had no problem paying for the higher mileage.”
Quick Thought on CPO
Webb briefly touched on the performance of certified pre-owned sales, which came in at 2.34 million units, according to Autodata Corp. The figure represented a record for the fourth year in a row and an improvement from the 2013 total of 10.8 percent.
Can the industry make a drive for five and gain another 10 percent or more in sales?
“It’s always depending on how much marketing efforts the manufacturers want to put behind them,” Webb said. “You would anticipate a fifth consecutive record to occur, but a double-digit increase would probably be overly optimistic.”
ADESA’s auction location in the Valley of the Sun is preparing for its fifth annual Legendary Sales Week. ADESA Phoenix’s event will feature special happenings on Tuesday and Wednesday, coinciding with the Barrett-Jackson Collector Car Event in Scottsdale, Ariz., which runs through Jan. 18.
“As one of our most anticipated annual events, this year’s Legendary Sales Week promises to be full of excitement,” said Ryan Edwards, general manager of ADESA Phoenix. “It will be a pleasure to share this event with our partners at Barrett-Jackson and the many car enthusiasts and dealers from around the country to join us for this occasion.”
The Legendary Sales Week will host a variety of features, including a wide assortment of vehicles, starting with a General Motors factory closed sale and a Ford factory closed sale. The featured sellers are many, including Ally, Chrysler Capital, Regional Acceptance/BB&T, Santander, Exeter Finance Group, Avis Budget Group, Enterprise Holdings, Ford Credit, Mercedes-Benz Financial Services, TD Auto Finance and others.
The final day of the event will feature a special vehicle to benefit charity, proceeds of which will go to the Juvenile Diabetes Research Foundation.
“We can’t wait to host another Legendary Sales Week in conjunction with Barrett-Jackson,” Edwards said. “Our team always looks forward to celebrating this event with our many friends and loyal customers.”
KAR Auction Services announced Wednesday afternoon that it has formed a new Digital Services Group that will be led by Peter Kelly, currently the chief technology officer for KAR.
The company said that, among other assets from KAR’s portfolio, the Digital Services Group will combine several businesses and brands, including OPENLANE, CarsArrive Network, and Recovery Database Network.
“During the past few years, KAR has invested hundreds of millions of dollars in developing a unique set of online and mobile tools aimed at building a more robust marketplace for sellers and buyers of automobiles and similar assets. Grouping these companies together is the logical next step in serving our customers with an integrated solution,” said KAR chief operating officer Don Gottwald.
Kelly will remain on the board of TradeRev, a player in the Canadian dealer-to-dealer remarketing space which KAR acquired 50 percent of in August. TradeRev is launching the platform in the U.S. currently.
Additionally, Kelly will be responsible for directing an incubator for all of KAR’s digital and mobile efforts.
“I am eager to take on this new role and excited to engage more deeply with our customers in addressing their business challenges,” said Kelly, who co-founded OPENLANE in 1999. “Our end-to-end capabilities give KAR an unmatched position to leverage for the benefit of our remarketing clients.”
KAR chairman and chief executive officer Jim Hallett added: “Peter is recognized as a leading innovator throughout the automotive remarketing industry, having helped create the online vehicle auction category. No one is better positioned to lead KAR’s growing digital portfolio and ensure we integrate these tools for our customers’ benefit.”
Almost exactly nine months after a Mississippi tornado swept through its property and delivered a mighty punch, Mid-South Auction — which is part of the XLerate Group — is reopening its auction arena and debuting updated facilities on Jan. 27, while also introducing a new general manager.
Among the new amenities to the arena are drop ceilings designed to enhance lane acoustics, as well as a new cameras and software to give dealers a better online experience, too.
“In April, a tornado hit our Mid-South Auction and did extensive damage to the auction arena,” said Cam Hitchcock, XLerate’s chief executive officer. “We took the opportunity to not only rebuild the auction but also to build a completely new and upgraded arena. Mid-South’s new arena will provide one the nicest auction environments in the region for our dealers in the South to buy and sell cars.”
The tornado hit the auction on April 28 — one of dozens of tornados to impact the South that day, according to The Weather Channel — and caused significant damage. Not long after, then-general manager Bob Sullivan talked with Auto Remarketing about the rebuilding efforts.
Sullivan had led the auction the past three years and spearheaded the redesign and construction of the new arena. He is now in a senior operations role with XLerate, and Mississippi native Tim Brantley has stepped into the GM role.
So, in addition to showcasing their brand new arena, the auction is also introducing Brantley to the community during the event.
“Tim Brantley was born and raised in Mississippi. Prior to joining Mid-South, Brantley spent 38 years with numerous remarketing assignments with GMAC/Ally. With his relationships in the Mississippi auto dealer community and experience on the sell side of the remarketing industry, we were honored that he chose to join XLerate as our newest general manager,” said Darris McClure, president and chief operating officer of XLerate.
“Tim has worked closely with our former GM, Bob Sullivan, who led the redesign of the new auction arena as well as managed the construction process. Bob will now move forward with XLerate in a senior corporate operations role as VP — operations and best practices,” he added. “We want to thank Bob again for leading the auction over the last three years and especially during the challenges of rebuilding Mid-South.”
Scott Allen of Rogers-Dabbs Chevrolet in Brandon, Miss., is one of the auction’s dealers. He notes: “Tim Brantley is solid gold. I’ve known him for years and worked with him in Memphis. He is a man who does what he says he will do. I know Tim will bring Mid-South Auction back to its heyday — and then build it up from there!”
Brantley added: “I have been welcomed back to my home state with open arms by Mid-South Auction staff and dealers alike. I am grateful to come into such a skilled and bonded family of employees. This auction weathered the storm and came out stronger and closer than ever.
“You’ll feel an enhanced energy in our lanes and with our sale," he went on to say. "The hard work has paid off, and we have a brand new year to show you the new Mid-South Auction!”
