DETROIT -
Chad Bailey, president and majority owner of Akron Auto Auction, believes that the National Auto Auction Association has a lot to offer its members — from helping them learn to become more effective leaders to figuring out ways to address the industry-wide service technician shortage and so much more in between.
 
In fact, Bailey has benefited so much from the programs and information offered by NAAA that as its president-elect, he plans to share with auction owners and general managers how getting involved in the association is an investment in the futures of their businesses.
 
Bailey, 44, is to be installed as president of NAAA at the group’s annual convention this week in Scottsdale, Ariz. The NAAA Convention is held in partnership with the National Remarketing Conference as part of Cherokee Media Group’s Used Car Week .
 
“An independent guy like me from Akron — I don’t have a research and development staff, so it’s on me to stay up on what’s going on and stay ahead of the curve and continue to change with the times,” said Bailey, who earned a B.S. in mass communications at Miami University in Oxford, Ohio and an MBA at the University of West Florida, in Pensacola, Fla.
 
“In my opinion, that’s why you need to be involved with NAAA — so you know what’s going on in your industry. Well, here I am. I care, and I got involved.”
Bailey is to take over the NAAA presidency from Warren Clauss, who works on strategic initiatives at ADESA, a business unit of KAR Auction Services. Clauss is the former general manager of ADESA Buffalo. Clauss will become the association’s chairman.

‘Get better, lead better’

Bailey points to becoming involved in an NAAA-sponsored leadership program created in 2011. 
 
The program was created in conjunction with the Disney Institute, which helps advise and train companies in a variety of industries “based on business insights and best practices of Walt Disney Parks and Resort,” according to the institute’s website.
 
The training focused on team building and how team members work together by recognizing and drawing on one another’s strengths, Bailey said.
 
“That excited me,” he said. “I’ve always wanted to get better and to lead better.”
 
NAAA also keeps members apprised of industry challenges and performs the costly, time consuming legwork to find solutions for members, Bailey said.
 
Take the industry-wide shortage of service technicians.
 
The problem is that many older technicians have either retired or are getting ready to retire, and many younger people, shunning the “grease monkey” image, are opting to pursue other careers, Bailey said.
 
This labor shortage is happening at a time when the U.S. Bureau of Labor of Statistics data predicts that more than 237,000 jobs in service and repair will open by 2024, said a June 2018 NAAA press release announcing that the association had commissioned a study about the problem and was seeking solutions.

Inspections and condition reports

Financial institutions that must liquidate vehicles they repossess and independent dealers who don’t have their own service departments are among the auction customers that often depend on auctions for pre- and post-sale mechanical inspections, said Bailey.

Condition reports that accompany vehicles offered for sale by auctions online are based on inspections and diagnosis conducted by service technicians, he added.

“Back in the day, your only auction customer was the guy in the lane,” he said. “What he saw was what he was getting.
 
“Now they’re sitting at their computers and need to know everything, other than just the picture. They rely heavily on auctions to be their eyes and ears.”
 
One approach is for auctions to partner with local technical schools to mentor students or offer apprenticeships, with the notion of hiring some of the students after they graduate, Bailey said.
 
Another solution could be that auctions make deals with local repair shops to allow shop technicians to work at the auction diagnosing vehicle problems.
 
In exchange, the auction might agree to send mechanical work to the local repair shop.
 
Bailey said auctions typically don’t pay technicians as much as franchise dealerships.
 
That’s because dealership service departments are profit centers, whereas many auctions perform inspections, diagnose mechanical problems and create condition reports for nominal fees. The cost of additional mechanical work is negotiated between the auction and the consignor, Bailey said.
 
Though the level of training and expertise for auction technicians is the same as for dealership technicians, auction techs, in general, don’t work a lot of weekends, excluding holidays and extreme weather events, he said.

Lower salaries vs. flexible schedules

That might be attractive to millennials and others who don’t mind trading off lower salaries for more flexible work schedules, he added.

But either way, finding competent service technicians is “a vital part of our industry, and we’re going to have to pay whatever we have to pay,” he said.

About 70 percent of the vehicles Bailey sells at his six-lane auction are owned by dealers, about 20 percent are repossessions and 10 percent are fleet-lease sales.
 
The vehicles are typically about six to seven years old and sell for about $6,000 to $8,000.
 
Bailey, during high school and college, worked off and on at Akron Auto Auction, started by his grandfather, and joined full-time as a consultant in 2000. He worked his way through the auction management ranks and acquired majority ownership in the company from his uncle in 2011.
 
Bailey has “always liked sports,” and helps coach football and basketball at his alma mater, Jackson High School, in Massillon, Ohio.
 
He and wife, Tracie, have two sons: Cole, 16, and Caden, 12.