The remarketing professionals who spoke on various remarketing topics included (from l-r) Jeffrey Perkins, general manager, fleet operations for Motorlease Corp.; Darrin Aiken, AVP of Vehicle Remarketing for Wheels; Chris Clarke, manager, North American Remarketing for ARI; and Alex Fraser, general manager, fleet management services for Cox Automotive Mobility. Photo by Steve Reed.
Trends in Remarketing Corporate Fleet Vehicles
In a packed room of remarketers, panelists representing four fleet management service companies discussed the latest trends affecting the corporate fleet remarketing sector.
The representatives included Jeffrey Perkins, general manager, fleet operations for Motorlease Corp.; Chris Clarke, manager, North American Remarketing for ARI; Darrin Aiken, AVP of Vehicle Remarketing for Wheels; and Alex Fraser, general manager, fleet management services for Cox Automotive Mobility.
Mike Antich, editor of Automotive Fleet, moderated the panel.
The panel discussed topics such as the role of online auction services, friction points between consignors and auctions, and the technologies that could change the landscape in the years to come.
Biggest Friction Selling at Auction and How to Minimize It
One of the biggest friction points between consignors and auctions is the sheer volume of vehicles that consignors are allocating to auctions, the panel agreed.
Auctions, on many occasions, do not have the proper staffing available to handle the volume that some fleet management companies are sending to them.
An initial solution to this issue that the panel discussed was for auctions to bolster their staff; however, that’s not always a simple solution, the panelists agreed.
Clarke with ARI noted that communication between auctions and consignors could help dissolve this pain point. If the consignor expects an influx in volume it will be sending to an auction, the consignor can be more proactive and alert the auction of this, so the auction can properly staff.
Perkins noted that a pain point for Motorlease is vehicle transportation.
“Transparency and consistency of what’s going on when a vehicle is assigned to an auction,” said Perkins. “Our vehicles could be picked up at a dealership or a corporate office, but once a vehicle is consigned, it’s hard to set expectations of when the vehicle will be transported. We can see the vehicle has been accepted and they’re working on it, but we don’t know much else other than that.”
There’s also the issue of there not being enough truck drivers to transport vehicles. There’s a shortage of truck drivers and it’s causing a strain on that aspect of the industry, Aiken noted.
Returning back to online sales, Aiken said that a friction point that exists for him is the lack of simulcast at an auction. If a company does not offer simulcast, Wheels typically won’t sign on to the auction, he said.
Removal of Telematics Devices & Personal Identifiable Information
A tool that a number of companies leverage in order to reduce fuel usage, optimize driver routes, and stay better informed of their fleet operations is telematics.
Certain telematics companies require companies to install devices inside their fleet vehicles in order to use their service.
When it comes time to remarket the vehicles; however, identifying who is responsible for removing the device and any personally identifiable information left in the vehicles at times isn’t clear.
“We have some clients where we have to manage the removal beforehand of the telematics devices,” said Aiken. “We have some clients where it has to be removed at the auction and destroyed, it’s all over the board and it’s not consistent.”
The entire panel shared this experience of inconsistency, but the panel also had a shared solution: make the removal of such data / devices explicitly clear on the service level agreement. The responsibility to remove this data or devices can be left to either a fleet management company or the company fleet, but that decision needs to be made upfront.
Online Remarketing
Digital sales are becoming a greater part of ARI’s operations, Clarke noted. Clarke remarked that on the day before the panel, ARI had sold 60 units through a digital platform. This was a significant volume of single-day digital sales for the company, Clarke added.
“We’re setting all sorts of records for online sales right now, and I don’t see why this won’t continue to grow exponentially,” Clarke said.
And, this online boom isn’t exclusive to just Clarke and ARI.
Digital sales have also been growing dramatically for Wheels, noted Aiken.
Aiken explained how he’s a big proponent of offering vehicles through simulcast at the same time that they’re running through a physical lane. By implementing this strategy, remarketers can maximize resale value, he added. Wheels is currently seeing anywhere from 35-38% of its vehicles selling to a simulcast buyer.
Along with maximizing resale values, continued growth in digital sales also has the potential to yield another benefit to auction partners: improved safety, Aiken added.
There’s an inherent danger to driving vehicles through physical lanes, he noted and minimizing the amount of vehicles driving through a lane will have a positive effect on possible accidents that can occur at an auction.
As online sales grow and online condition reports and vehicle imaging improve, fewer cars will be driven through lanes, and few hazards at auctions will exist.
Cox Automotive’s Fraser echoed this sentiment.
“Some bad things have happened at auctions, and we’re actively pushing more and more to best digitally represent consignors’ cars online,” said Fraser. “Whether that’s better image processing, better condition reports, and offering some sort of protection to buyers who worry about buying a car they haven’t seen or touched in person. All of those things create a safer environment for our employees, dealers, and to ourselves.”
Some sellers at Manheim auctions have stopped selling vehicles in lane and have gone completely digital, Fraser noted. Many of those sellers have not seen a financial impact in either a positive or negative direction, but the benefit to safety is so significant that they’re willing to continue selling primarily, if not solely, digitally.
At the same time, other sellers have tried not running vehicles through physical lanes and have decided it’s not for them, Fraser added.
Neither Clarke, Aiken, nor Fraser feel like physical auctions will go away, but they do all feel that the purpose it fulfills will change in the years to come.
Perkins of Motorlease noted that with this company’s portfolio, selling at physical auctions continues to produce the best results. He is actively exploring different digital platforms, however, and will move toward that route when it makes the most financial sense.
Looking at What’s to Come in Remarketing
One type of vehicle technology that’s already affecting vehicles at auction is advanced driver-assistance systems (ADAS).
Newer vehicles arriving at auction are coming equipped with systems like adap-tive cruise control and lane departure warnings. The way that these vehicles, and the technology within them, are being serviced and maintained in body shops is creating a gap throughout the industry.
Some body shops are doing a better job than others in ensuring the safety of these vehicles is being maintained and it’s going to be the duty of remarketers to ensure these new safety features are maintained through a vehicle’s entire lifecycle.
Keys for success in the future will be exploring all the new channels that emerge, and maintaining open dialogue between partners, the panelists agreed.
Different channels will emerge and staying at the forefront of them and looking for new ways to sell vehicles more efficiently and faster will be vital for remarketers, Clarke noted.
“We’re going to see a change in the industry that we have not seen move as fast,” said Aiken. “What Chris is saying is true, we’re going to see more and more digital, selling more and selling it faster. We’re going to sell vehicles before they show up at a dealership. Days to sell will be the metric and, in the future, days to pick up as a metric will go away, because it will be pre-sold before it ever hits the lot.”
Source: https://www.automotive-fleet.com/
I´m a Fleet Management expert, and the manager of Advanced Fleet Management Consulting, that provides Fleet Management Consultancy Services.
