Greater Erie Auto Auction recently announced that the operation has promoted Ryan Russell to assistant general manager/sales manager. Russell, who was formally a territory sales representative for the auction, brings more than 15 years of auction experience to his new role.
Russell came to Greater Erie AA six years ago as he previously worked for ADESA as a dealer sales and service rep at its location in Mercer, Pa.
“We are very excited to have Ryan move into this position,” Greater Erie AA owner Todd Briggs said. “He is very focused on growing and expanding the auction. His out of the box thought process and communication skills, will prove to make him a great leader to our staff.
“He will be co-managing with Chrissy Briggs, assistant general manager/fleet manager and our management team, to move Greater Erie in a great direction in 2017,” Briggs continued.
“Patty and I are proud to introduce and announce Ryan to our management team and look forward to 2017. Dealers will see Ryan in their stores, in the auction lanes or in the corner office,” Briggs went on to say.
Greater Erie AA is located in Fairview, Pa., on Interstate 90 between Buffalo, N.Y., Pittsburgh and Cleveland and offers more than 400 units every week across four auction lanes. The facility features lighted security, 24-hour gate control and leverages both Auction Pipeline Simulcast and AutoIMS.
Current consignors include Credit Acceptance/VRS, Element Fleet, Select Remarketing Group/SRG, Fleet Lease Disposal and several local banks and finance institutions. Sale day is Tuesdays 2:30 p.m. For more information, visit www.greater-erie.com.
Auction Management Solutions (AMS) recently announced that the firm has partnered with Central Auto Auction (CAA) of Hamden, Conn., for business development consulting.
In explaining why he made this move, CAA owner Peter Saldamarco said, “We are very excited to be a part of the AMS group of auctions. We have spent a lot of time building a great base of dealer consignment business over the last 11 years, as well as some fleet /lease and repossession business including the GSA account, and feel that it is time now to start to expand into focusing on national consignors.
“We feel that AMS can be a great help to achieve our goals,” Saldamarco continued.
CAA was started back in 2006, and is celebrating its 11th anniversary this year. CAA offers a live weekly sale every Tuesday morning across four auction lanes on more than 12 acres of land. The operation currently offer 350-400 units weekly.
CAA is a full-service auction with full reconditioning, mechanical services, and even a licensed vehicle scrap facility all on premises. More details are on its website at www.centralaa.com.
“We are very excited to be working with CAA,” AMS’ Tom Stewart said. “Peter and his family and his team have built a very strong auction in the New England area, and we welcome the opportunity to be able to work with a very strong family auction.
“One of our goals here at AMS is to focus on providing our customers with the best service we can, while working through a proven sales strategy to help them grow their business,” Stewart went on to say.
Adding this CAA to its client roster brings the AMS to 14 total locations, which also include:
—Columbus Fair Auto Auction
—Greater Quad City Auto Auction
—Rochester Syracuse Auto Auction
—Greater Erie Auto Auction
—DAA Chattanooga
—DAA Murfreesboro
—DAA Memphis
—DAA Huntsville
—DAA Mobile
—Southeastern Auto Auction
—Dealers Auto Auction of Idaho
—166 Auto Auction
—All Valley Dealers Auction
Copart recently expanded its Chicago North location where sales occur at noon every Thursday.
“The Chicago North expansion is a great addition to our network in the Chicago area where we currently have four locations serving our members and sellers,” Copart chief executive officer Jay Adair said. "This land allows the capacity to continue growing in the Chicago market.”
Copart said it practices good corporate citizenship and prides itself on giving back to the local communities in which it does business. Throughout the Midwest, Copart said its locations have given back to its communities.
Copart Des Moines in Iowa showed its support for both their fellow military veterans at Copart and all American veterans through their participation in the 2016 Des Moines Ruck. Copart Indianapolis hosted its local Indianapolis fire department and provided a safe training environment for the department’s three-day training.
Local law enforcement agencies are encouraged to contact the general manager at the Copart Chicago North location to learn more about conducting training at Copart.
In addition to supporting local agencies and veteran services, Copart supports numerous local, regional and national charities. To learn more, visit TeamCopart.com.
CARS Recon announced that three of its executives have transitioned into new roles on Thursday.
Kay Hudson, one of the honorees among the 2016 Women in Remarketing, left her role as chief operating officer on Jan. 1 to become the managing director of international vehicle services.
Philip Hill, formerly the company’s vice president of finance, is now the senior vice president of finance and administration.
“Over the past 12 months, I have had the opportunity to work with Philip. Philip has proven to be a top performer for our company," said CARS Recon chief operating officer Harold Varvel. "He demonstrates a strong will power and determination in his current position, which will ensure his continued success. We expect great things from Philip in the future as we continue to integrate technology into our business.”
Varvel, transitioned out of his role as senior vice president of finance and administration, to become chief operating officer.
He is now responsible for both field and overall operations of the company.
“Harold (Varvel's) perspective and knowledge of the industry will allow him to build on the platform Kay has built to move CARS Recon, Inc. ahead,” said Ronald Hope, president and chief executive officer of CARS Recon.
Cars.com has named a new chief financial officer.
Moving into the role on Monday will be Becky Sheehan, who previously was executive vice president and CFO for FTD Companies.
In that position, she also served as a member of the office of the chief executive officer.
Her 10-year tenure there included her time directing FTD’s initial public offering in 2013. Sheehan also spent close to two decades in public accounting, including a position as audit partner with Deloitte.
"In this next phase of our evolution, Cars.com is poised for expansion and revenue growth, and we're excited to have Becky aboard as an experienced public company executive who will be a critical leader in our spin from TEGNA and beyond," Alex Vetter, president and chief executive officer of Cars.com, said in a news release.
"She is a proven leader who understands our goal of becoming the leading decision engine that moves people through the car ownership lifecycle with transparent, fun and engaging experiences, and is passionate about building a business that will help us realize this mission."
Sheehan said: "I'm thrilled to have this opportunity to help guide the growth of another fast-growing, publicly traded technology company and I look forward to applying the considerable experience that I gained while transforming FTD's online consumer business to my new role at Cars.com. Together with Alex and the great team at Cars.com, we'll enhance our leadership position, achieve our growth strategy and fulfill our purpose of helping people win."
With vehicle shopper preference for SUVs and crossovers apparently strengthening and not waning, Cox Automotive chief economist Tom Webb is confident used-car managers should find higher amounts of those units flowing through the wholesale market this year, especially as off-lease models.
It’s all part of the wholesale surge where Webb is expecting overall wholesale volume to approach 7.8 million units by the end of next year, as more than half of that figure should be off-lease vehicles.
When asked about how the off-lease lanes might shift away from being full of less-desirable compact and midsize cars, Webb replied, “I think the worst of the imbalance is actually over where the product was relatively new in some of those crossover vehicles, which have a lot of appeal.
“They were not coming back off-lease yet, but that now has occurred,” he continued during his quarterly conference call with the media and investment analysts on Monday. “We’re now where those volumes are growing. I think that will be very helpful. It’s much more balanced than it was in the past.
“Still there are a large number of compact, basic model sedans that are being leased. But you could also argue that the consumer preference shift away from those vehicles might have already played out,” Webb went on to say.
Later in the call, Webb mentioned leasing activity increased for vehicles now in high demand, models such as Ford Escape and Toyota RAV4. Auto Remarketing went back to the State of the Automotive Finance Market Report generated by Experian Automotive that contained information from the first quarter of 2014. Turns out, Experian’s report showed that 2.91 percent of all new-model leases in the quarter were Escapes; a reading second to only the mark connected with Honda Civic at 3.45 percent.
And Experian indicated 1.97 percent of all new-model leases in Q1 2014 were for the RAV4. Meanwhile, another popular compact SUV — the Honda CR-V — also was among the top 10 leased models in that quarter as that unit generated 2.69 percent of new-vehicle leasing activity during that span.
Now, some of those units are already or soon will be going over the block.
“There are going to be a large number of compact SUV and crossover type models,” Webb said. “I think we’ll be a little more aligned with customer tastes. The overall movement in leasing the past couple of years has been toward mainstream models instead of solely focused on the luxury end of the market.”
Rental-risk unit & new-model incentive analysis
Webb indicated a straight average of auction prices in December for rental risk units sold at auction topped the $17,000 mark for the first time ever and was 5 percent higher than a year ago.
However, after adjusting rental-risk prices for broad shifts in market class and mileage, Webb determined pricing for these units softened by 4.4 percent.
Webb went on to mention the average mileage of rental-risk units sold in December (38,600 miles) was similar to recent months, but 13 percent lower than a year ago. He then reiterated why the 2015 mileage readings that surpassed 50,000 were so unusual.
“That exceptionally high mileage in 2015 was driven by some industry-specific and company-specific factors, which are gone,” Webb said. “My discussions with the rental car companies is that we’re pretty comfortable with that level to maximize value.
“There is going to be a little bit more of a tendency for a wide frequency distribution within that average mileage where there might be opportune times for the rental car companies can sell a risk unit with low mileage just because it might be hot in the wholesale market at that time,” he continued. “And there are certainly cases where they might want to extend the life, which they can with relative ease.”
And with mileage levels stabilizing, Webb also pointed out that the condition of rental risk units is perhaps as good as it’s ever been. Manheim determined the volume of units going through the wholesale market in the fourth quarter of 2016 with condition grades between 4 and 5 surpassed 40 percent to the highest level going back to Q1 of 2015.
“It was feared that as the rental car companies shifted a higher share of their sales away from auctions over to direct sales to dealers and even retail consumers that the less desirable units would end up at auction,” Webb said. “Clearly that has not been the case.
“That’s because the rental car companies also have an inherent interest in protection residual values overall. The specific brands they hold in their fleet, they know the auction represents the truest form of price discovery and as we say the only venue where you can get more than you asked for,” he went on to say.
Webb closed his off-rental discussion by insisting how much new-vehicle incentives can impact risk-unit price performance.
“With respective to incentive activity, (rental-risk units) are basically 1-year-old vehicles so they’re extremely sensitive to the incentive activity that’s going on within the new-vehicle side of the market,” he said. “We’ve been relatively but not overly aggressive. I know there are some concerns that incentive levels are at record levels, maybe adjusting them for the transaction price. But my general sense of the market is that it hasn’t destroyed the overall wholesale values at the current time. There are obviously specific segments of the market like it’s certainly hurt the compacts. There is some intense pressure to move the new units that people really don’t want to buy.
“In terms of the go forward, I’m still relatively optimistic that they don’t go crazy in terms of an incentive war,” Webb went on to say. “This cycle is a little different than previous ones where you have to realize the manufacturers themselves basically are holding the residual risk on basically about 10 million lease units that they have in their portfolio. You would think they would keep that in mind when they do their vehicle push.”
Looking at information for the first full week of 2017, the newest Black Book Market Insights Report detailed steeper declines in value for several segments — with three in particular catching editors’ attention most.
Registering the most significant price drops last week were sporty cars, luxury cars and crossovers. Conversely, Black Book noticed compact vans have been able to retain their value “sufficiently” since last week.
“Smaller cars are back in demand at the start of the new year. We expect a good spring season this year for such vehicles. Sporty cars show higher declines due to seasonality,” said Anil Goyal, senior vice president of automotive valuation and analytics at Black Book.
Volume weighted, editors indicated overall car segment values decreased by 0.45 percent last week; lower than the average depreciation rate of 0.56 percent seen in the previous four weeks.
Prices in the sporty car, luxury car, premium sporty car and prestige luxury car segments declined the most by 0.87 percent, 0.72 percent, 0.72 percent and 0.71 percent, respectively.
Again, volume weighted, Black Book said overall truck segment values (including pickups, SUVs and vans) decreased by 0.51 percent last week; same as the average depreciation rate of 0.51 percent posted during the previous four weeks.
Editors found that the subcompact crossover, full-size crossover and midsize crossover segments declined the most by 1.36 percent, 0.88 percent and 0.85 percent, respectively.
Black Book representatives mingling in the lanes during the first week of the year focused on dealer mood when reporting back to headquarters
An auction watcher in Tennessee said, “Plenty of dealers here today but consignment was rather low.” A similar scene played out in Missouri as the representative said, “Low consignment today but buyers expect that to change in coming weeks.”
Trucks also another subject often relayed from Black Book representatives.
One in Michigan said, “Clean trucks are doing well but the rest of the market is weak,” as another in Pennsylvania added, “Average market trend here with most attention directed towards trucks.”
A couple of high points in the lanes occurred in Texas and Arizona.
The lane observer in the Lone Star State said, “The market is improving slightly with several consignors having a good day today,” while in Arizona it was a “steady sale today with prices on the high side for this time of year.”
A closing comment also came from Arizona as Black Book’s representative reported that, “Soft late model used sales around here. Used having to compete with new incentives.”
From at least a mathematician’s perspective, 2016 closed with Manheim noticing the least amount of volatility since the auction company created the Manheim Used Vehicle Value Index more than 20 years ago.
Manheim reported on Monday that wholesale used-vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) increased by 0.2 percent in December, which brought the index reading to 124.9. The mark represented a decline of 0.6 percent from a year ago.
Cox Automotive chief economist Tom Webb combined both high-level math with other bits of analysis to explain why wholesale prices finished the year on that trend.
“Despite significant increases in auction volumes in 2016, wholesale pricing was firm. On an annual average basis, the Manheim Index was even able to eke out a small gain of 0.3 percent, the third increase in a row,” Webb said.
“The most notable aspect of wholesale pricing in recent years has been the stability,” he continued. “After a sharp rise in wholesale pricing in 2009 and 2010 coming out of the recession, the absolute year-over-year change in pricing was less than 2 percentage points in each of the last six years. Statistically speaking, this period has shown the least volatility in wholesale vehicle pricing since the Manheim Index’s inception in 1995.
“In addition to macro-economic and industry factors, this stability has been driven by better, and more efficient, remarketing practices that have enabled commercial consignors to anticipate, respond to, and, thus, minimize impending swings in wholesale pricing,” Webb said.
Looking deeper at price movements by vehicle segment, Manheim noticed pickups posted the only year-over-year price rise in December, moving up by 4.3 percent.
Prices for units in four other segments softened year-over-year in December as Manheim reported declines for luxury cars (down 0.8 percent), SUVs and CUVs (down 1.2 percent), midsize cars (down 3.7 percent) and compact cars (down 5.3 percent).
As for vans, Manheim said prices for those units remained unchanged in December when compared to a year earlier.
“Although overall wholesale prices have been very stable of late (a movement of only 1.2 percent over the past four years), the differences between market classes have been pronounced,” Webb said. “At the extremes, adjusted wholesale prices for pickups have risen 28 percent during this period, while compact car values fell 14 percent.
“Blame it on the tremendous consumer preference shift toward crossovers and away from small sedans,” he continued. “On the new-vehicle side, flexible production capacity enabled manufacturers to better adjust to this shift than in past cycles.
“As a result, the share of new-vehicle sales accounted for by ‘trucks’ was more than 60 percent in 2016, up from only 45 percent in 2009,” Webb added.
So what do those trends mean for smaller units?
“Of course, the ‘production of used vehicles’ (i.e., past new-vehicle sales) can’t be adjusted,” Webb said. “As a result, the supply of used compact cars has been higher than what consumers demanded in recent years, and as a consequence, residuals suffered.”
Editor’s note: Watch for upcoming reports this week from both Auto Remarketing and SubPrime Auto Finance News as Webb shared more insights about the current state of the market and what might happen later in 2017.
On Wednesday, Copart announced the addition of its first location in Wyoming and fourth in Colorado, along with the expansion of its Springfield, Mo., location.
"We have been expanding and adding new locations throughout the United States this year, and we are pleased to add Wyoming as our 46th state in which we are operating," Copart chief executive officer, Jay Adair, said in a news release.
"Our land and ability to accommodate inventory is one of the many things that sets Copart apart," Adair continued. "Our sellers depend on us to have land available for their vehicles, and our expansions and new locations exhibit our ability to provide our sellers with an unmatched experience."
The company’s two new locations are in Casper, Wyo. and Littleton, Colo.
Last year, Copart reported the opening of 10 new locations and the expansion of 13 existing locations nationwide.
Copart also grew internationally after developing operations in the Republic of Ireland, Spain and Germany in 2016.
"We achieved a tremendous milestone last year when we eclipsed an annual sales rate in excess of two million vehicles sold, and these new locations and expansions allow us to accommodate our growing inventory," said Adair.
Auction Academy, a continuing education program developed by TPC Management Co. for professionals in the auto auction industry, reports that it closed the year graduating its fourth class, and hosting the last session of its recently expanded annual Seminar Series.
“In planning both our two-year Program and the shorter focused Seminar Series, we continue to cover topics that are critical to the overall development of leaders in our industry and success of their auctions,” Auction Academy chief operating officer Randall McCathren said in a news release. “The enthusiastic participation from all corners of the industry confirms that Auction Academy plays a critical role in the remarketing industry and has raised the bar for career education.”
The two-year training program provides students development experience for automotive auction professionals.
Structured like an Executive MBA program, the curriculum includes site visits, field trips and work with industry experts in all areas of auction operations, according to Auction Academy.
Registration is open for class five of the two-year program which will begin in the spring. All auction personnel are eligible to enroll.
Following the graduation of the fourth class, Auction Academy hosted its final Seminar Series event of 2016 in Nashville, Tenn.
In 2016 the continuing education program hosted four individual sessions: dealer sales, digital management, fleet/lease account management, and compliance, the focus of Auction Academy’s latest seminar.
“We felt there was a need in the industry for a shorter term training program with an intensive focus on specific topics, and launched our Seminar Series with a session for Digital Managers in July of 2015,” Auction Academy chief executive Pierre Pons said in a news release. “That session was a resounding success, with attendance far exceeding our initial estimates and very positive evaluations. As a result, we decided to expand the Seminar Series to include one session in each quarter in 2016, highlighting a key topic of specific interest to the independent auction community at each session.”
Auction Academy’s 2017 Seminar Series will focus on leadership, operations/arbitration/OSHA, fleet lease and digital management. Dates for the four sessions are to be announced at www.auctionacademy.net.
