Used Car News 11/6/17 by General Media LLC

November 6, 2017

www.usedcarnews.com

Industry Celebrates Defeat of Arbitration Ban

Photo by Jeffrey Bellant CELEBRATING A WIN: National Independent Automobile Dealers Association CEO Steve Jordan tells the crowd at the recent National Alliance of Buy-Here, Pay-Here Dealers conference about the successful vote to block the Consumer Financial Protection Bureau’s arbitration ban. By Ted Craig & Jeffrey Bellant

The U.S. Senate passed a resolution that blocks the Consumer Financial Protection Bureau’s arbitration ban, with Vice President Mike Pence casting the deciding vote to break the 50-50 Senate deadlock. The resolution uses the Congressional Review Authority to block the CFPB’s ban on mandatory arbitration agreements in inance contracts. These agreements are used by inance providers – including auto creditors and buy-here, pay-here dealers – to prevent consumers from joining class-action lawsuits.

The House already passed its version of the resolution. There was some concern the Senate would let the rule take efect following the recent scandals at Wells Fargo and Equifax. The vote was almost entirely along party lines, except for Republican Senators Lindsey Graham and John Kennedy breaking ranks and voting with the Democrats. “This is good news for the American consumer,” said Arkansas Sen. Tom Cotton after the vote. “The repeal of this regulation is a good irst step toward reining in a rogue agency.” Industry leaders announced the

result of the Senate vote on the arbitration issue during a recent industry event and dealers in attendance applauded the news. Steve Jordan, CEO of the National Independent Automobile Dealers Association, said it’s a big win for the industry. It was one of the issues that the NIADA has lobbied for during its annual treks to Washington for its Day on the Hill events. “This is monumental,” said Paul John, executive director of the Georgia IADA. “This is a huge win.” The ban came after the CFPB conducted a study on the efect of ar-

bitration on consumers. This study was mandated in the bill that originally created the regulator. Shaun Petersen, senior vice president of legal & government afairs, said the CFPB’s own study showed the arbitration rule would also have been bad for consumers. “Their own data suggested that consumers were not getting the beneit of class action lawsuits,” Petersen said. “They did better through arbitration than class action lawsuits.” A U.S. Treasury Department study of the data and the CFPB’s ruling back up Petersen’s claims. Continued on page 5

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USED CAR NEWS

November 6, 2017 • 3

Consumer Reports Gives Low Scores to New Tech DETROIT (AP) – Toyota Motor Co. is continuing its reign at the top of Consumer Reports’ reliability rankings, a reward for its conservative approach to new technology. The Toyota brand came in irst in this year’s rankings, followed by the company’s luxury Lexus brand. It’s the ifth year in a row that a Toyota brand has topped the survey. Kia, Audi and BMW rounded out the top ive. Cadillac, GMC, Ram, Dodge and Volvo got the poorest reliability scores, dinged by buyers’ problems with their infotainment systems and transmissions. Consumer Reports predicts reliability of 2018 vehicles based on a survey of its subscribers, who owned or leased 640,000 vehicles from the 2000-17 model years. Consumer Reports forecasts how a model will perform based on recent data for that model. The magazine gives more weight to mechanical and safety issues than minor problems like wind noise. The magazine’s rankings are closely watched in the

industry, since many buyers seek advice from Consumer Reports. Jake Fisher, Consumer Reports’ director of auto testing, says Toyota’s strategy of adding new technology gradually – instead of all at once – helps make its vehicles more reliable. Toyota’s new Camry sedan, for example, has an eight-speed transmission that was irst tested on the Highlander SUV. Kia has also steadily climbed in the rankings because it uses proven technology that has already been tested by its sister brand, Hyundai, which slipped in the rankings. Consumer Reports found that the Kia Niro hybrid, which went on sale earlier this year, was the most reliable vehicle in its entire survey. Audi and BMW also have better-than-average infotainment systems because they were some of the irst to market with them more than a decade ago. “They’ve had all those growing pains,” Fisher said. By contrast, Buick dropped

TOP PERFORMER: Kia scored high on this year’s Consumer Reports dependability rankings, thanks in large part to vehicles like the Niro.

from third to eighth in the rankings because of troubles with its new 2017 LaCrosse sedan, which has a new eight-speed transmission, new engine and new electronic shifter, among other features. Fisher said other recent Buicks, like the Envision, went on sale in China or Europe irst and got some kinks worked out before

heading to the U.S. Electric cars escaped some of those reliability problems because they have fewer parts. General Motors Co. didn’t fare well overall, but its new Chevrolet Bolt electric car had above-average reliability. In its debut on the list, Tesla Inc.’s Model 3 sedan got an “average” reliability score. The car isn’t

widely available yet, but the magazine based its ranking on responses for the company’s Model S sedan, which has above-average reliability. “There’s a lot of stuf that’s not in electric cars,” Fisher said. “They’re simpler.” Chrysler was the biggest climber in the rankings. Acura fell the furthest. SAVANNAH, GA

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4 • November 6, 2017

USED CAR NEWS

NEWS BRIEFS Facebook Adds Car Shopping

tives via Messenger, powered by cal point for shoppers, introducing Facebook is adding car shopping chat providers like ActivEngage, a new vehicle alert feature for the CarCode, Contact At Once!, and most up-to-date vehicle availability. to its Marketplace forum. The updated site also features a Facebook users will now be able to Gubagoo. new vehicle recommendations tool browse inventory from auto dealers and an interactive payment calculathrough new partnerships with Edtor to help potential customers ind munds, Cars.com, Auction123, CDK Automaker Redesigns CPO Website Acura debuted a completely re- vehicles within their budget, along Global and Socialdealer. Users can ind what they’re looking for by vis- designed Certiied Pre-Owned ve- with a seamless browsing experiiting the enhanced vehicles section hicle website that simpliies Acura’s ence on any device. and iltering listings by year, make, online CPO vehicle shopping promodel, mileage, vehicle type and cess, ofering shoppers the ability to transmission. They can also view car compare vehicles and features and Cars.com Adds Pricing Badges share their selections with friends Cars.com expanded its suite of values from Kelley Blue Book. They can then communicate di- and family. The new Acura CPO site pricing tools with the launch of rectly with dealership representa- makes inventory the primary fo- “Badging.”

MILESTONES Robert (Bob) Ernest Thompson, died Oct. 21 in Perham, Minn. Thompson was an owner of the Mid-State Auto Auction in New York Mills, Minn. Thompson considered all who worked at Mid-State his second family. He loved when auto dealers would stop by his oice to visit. Thompson was born in Ogema, Minn., at his family’s home. He grew up in New York Mills and graduated from New York Mills High School. Thompson opened his irst usedvehicle store in 1957, selling RVs and

a few cars. He started part-time, but became a dealer full-time in 1959 when he opened a used-car store. Bob Thompson Motor Co. grew into a ive-store operation. A trip to what is now ADESA Fargo inspired him to get into the auction business. He started out by running what is now Manheim Minneapolis before opening Mid-State in 1983. Thompson is survived by his wife of 63 years, Bonnie; ive children and their families: Debbie and Edward Stec (Tony & Anne); Denise and David Schornack (Jenny and

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New badge icons on the inventory pages help provide more context behind why a vehicle is priced the way it is. Badging leverages machine learning to assess the closest comparable vehicle and considers vehicle features either in high-demand for the region or those that impact the price beyond year, make, model and trim. The four badges include “Great Deal,” which means the vehicle is priced signiicantly below market average; “Good Deal,” which identiies cars priced at or slightly below market average; “Fair Price,” for vehicles priced slightly above market average; and “Well-Equipped,” highlighting vehicles with additional features that are afecting the price.

Shawn Aanenson; Andy and Jill Schornack; and Joseph Schornack); Carvana Moves into Another Market Deena Cavanagh and her companCarvana recently moved into the ion Jef Carlson (Lee, Taylor and Albuquerque, N.M., market. Megan Cavanagh); Daidre and Tim Carvana now operates in 38 marSullivan (Nate and Amy Sullivan, kets. Dain and Benjamin); Robin and MisChelle Thompson (Brandon and Nikki Thompson, Michael, and Abby); and eight great grandchildren. In lieu of lowers, donations are requested to local food pantries in Perham, New York Mills, or WadePAGE 13 na, Minn. Published By General Media LLC USED CAR NEWS (ISSN 1555-7413) is published at 24114 Harper, St. Clair Shores, MI 48080 Phone: 586-772-5200 or 800-794-0760 Fax: 586-772-9400 www.usedcarnews.com Charles M. Thomas - Founder (1947-2002) Lynda R. Thomas, Publisher Colleen Fitzgerald, General Manager Editorial: Ted Craig, Managing Editor Jeffrey Bellant, Staff Writer Contributing Writers: Ed Fitzgerald, Jenny King, Sheila McGrath Advertising: Shannon Colby, Account Manager Marie Hingst, Account Manager

Columnist: Tony Moorby Circulation: Helen Thomas Production: Tom Savage, Production Manager Cee Lippens, Web Master & Graphic Designer

Vol. 23 • No. 15 Used Car News is published the irst and third Monday of each month. Subscribers: We print advertisements as sent to us by auctions and other advertisers. It is not possible to verify the correctness of listed vehicles in auction ads. Most lists are partial and all lists are subject to last minute changes by auto auctions, so before travelling a long distance for a particular auto auction event, contact the auction by telephone for a fax of vehicles in the sale. Used Car News assumes no guarantees or liabilities concerning the accuracy of any advertisements. All Rights Reserved.

Reproduction in any form is prohibited without the written consent of the publisher. OUR ADVERTISING APPROVAL POLICY Payments from irst time advertisers must accompany the insertion order. Distribution is guaranteed by the USPS. he advertising reservation deadline is 12:00 noon hursday, 11 days prior to the issue cover date. Ad materials are due by 5 pm Friday, 10 days prior to issue cover date. For advertising speciications please email colleen@usedcarnews.com.

Join the Conversation! Visit Used Car News online at www.usedcarnews.com or scan this QR code with your smartphone to be taken directly to the website.

USED CAR NEWS

November 6, 2017 • 5

NADA Slams Stair Steps “In a world where customers rightfully expect fairness and transparency in price, why do so many manufacturers still employ unfair marketing strategies that produce huge discrepancies in price between various customers – discrepancies that aren’t transparent, that can’t be explained rationally, and that run afoul of everything our customers really care about?” Scarpelli said. The 2017 NADA chairman said he hopes to continue having constructive conversations with manufacturers about this issue. “America’s dealers and manufacturers have the same exact goal – selling our inventory in large volume and at competitive prices,” Scarpelli said. “But we believe that goal should be achieved in the right way: Meaning in a way that enhances customer experience, and that maintains the integrity of the brand.” However Webb, who has watched these incentives for years, questions the chances of changing the manufacturers’ practices. “The reason they use them is they work,” Webb said. All incentives hurt used-car values. Webb said the least harmful are probably discretionary cash that goes directly to the dealers.

DETROIT – Stair-step incentive programs damage brands by eroding customer trust. That was the message delivered by National Automobile Dealers Association Chairman Mark Scarpelli during a recent presentation to the Automotive Press Association. “Any dealer who’s had to deal with these programs can tell you that they are not only trust killers, but they’re brand killers, too,” Scarpelli said. “Not being able to ofer two customers the same price on the exact same equipped vehicle, just because they came into the dealership on diferent days of the month, destroys consumer conidence.” But they also hurt used-car values. Tom Webb, former chief economist for the NADA, said the incentives warp normal pricing to the point it creates conlict between new and used sales. Once dealers sign up for a stairstep program, it becomes logical to even sell a car at a loss to meet their total sales goal, Webb said. Stair-step incentives vary between dealerships, creating confusion about pricing. Scrapelli said the programs create large discrepancies in price for the same or similar vehicles across diferent dealers, or even at the same dealer at diferent times.

Arbitration Ban – from page 1 According to the Treasury study, the CFPB’s arbitration ban would have generated more than 3,000 additional class action lawsuits over the next ive years, imposing more than $500 million in additional legal defense fees, and transferring $330 million to plaintifs’ lawyers. The CFPB’s own data show that the vast majority of class action lawsuits deliver no relief to the class and consumers rarely claim relief available to them, the Treasury report stated. “Those of us with ‘Esq.” at the end For Cars, Trucks and Vans

of our name were the ones really making out in class action suits to the tune of hundreds of millions of dollars,” Petersen said. The Treasury study went on to say the CFPB did not show that its rule would achieve a necessary increased compliance with the federal consumer inancial laws, despite the rule’s high costs and the regulator failed to consider alternatives to its ban on mandatory arbitration clauses. The legislation prevents the CFPB from taking up the ban again.

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USED CAR NEWS

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General Motors Financial Company Inc. announced income from continuing operations of $186 million for the quarter ended Sept. 30, compared to $134 million for the quarter ended Sept. 30, 2016. Retail loan originations were $4.7 billion for the quarter, compared to $5.3 billion for the quarter ended June 30, and $4.2 billion for the year-ago quarter. Operating lease originations were $6.5 billion for the quarter, compared to $6.7 billion for the quarter ended June 30, and $6.1 billion for the quarter ended Sept. 30, 2016. The outstanding balance of commercial inance receivables was $9.5 billion at Sept. 30, compared to $9.7 billion at June 30, and $6.6 billion at Sept. 30, 2016. Retail inance receivables 31-60 days delinquent were 3.6 percent of the portfolio at Sept. 30, and 4.4 percent at Sept. 30, 2016. Accounts more than 60 days delinquent were 1.6 percent of the portfolio at Sept. 30 and 1.9 percent at Sept. 30, 2016. Annualized net charge-ofs were 1.9 percent of average retail inance receivables for the quarter and 2.5 percent for the quarter ended Sept. 30, 2016. GM Financial also recently cele-

brated the grand opening of its new service center in San Antonio. “We are excited to celebrate the grand opening of our San Antonio Service Center, which expands our economic and employment presence in the state of Texas,” said Dan Berce, president and CEO of GM Financial. “Along with our parent company, General Motors, we are proud of our long history in the state, where together we employ more than 11,000 people, all committed to building and inancing some of the best vehicles in the world.” As part of the ribbon-cutting ceremony, GM Financial presented Ronald McDonald House Charities of San Antonio with two ‘Cool Cars’ as part of its Cool Cars for Remarkable Kids program – the 17th Ronald McDonald House to receive a vehicle since program launch earlier this year. Cool Cars for Remarkable Kids provides late-model SUVs to Ronald McDonald Houses across the country, allowing children and their families transportation support while staying at a House. To support this local efort, North Park Chevrolet Castroville agreed to sponsor service and maintenance for both Cool Cars in 2017-2018.

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8 • November 6, 2017

USED CAR NEWS

TAX SEASON PREVIEW EXPERTS: TAX SEASON CHANGES HERE TO STAY By Jeffrey Bellant

ORLANDO, Fla. – Changes to the timing of tax refunds caught many dealers by surprise last year. They need to know this is the new normal. The Path Act of 2015 went into efect for the 2016 tax year, afecting returns in 2017. In addition to extending or making permanent several tax provisions and addressing other issues, the law also changed the timing of some tax returns as a way of preventing identity fraud. The change meant that the Internal Revenue Service waited until Feb. 15 to start processing returns that claim the Earned Income Tax Credit or Additional Child Tax Credit. Bill Neylan, president and CEO of Tax Refund Services Tax Max, said that delay was devastating to some dealers who expected earlier returns. Dealers who bought cars in October or November on 60- or 90-day loor plans

waited in vain for tax money. “A lot of dealers who were not aware of the Path Act violated their loor plans and a lot went out of business,” Neylan said. In the upcoming refund season, he predicts the IRS will hold these types of refunds until Feb. 26 or Feb. 27 and then send them out all at once. “Ninety percent of all refunds (this year) were released in two days,” Neylan

Photos by Jeffrey Bellant TAXMAN: Bill Neylan,president and CEO of TRS Tax Max (above) updates attendees at a recent buy-here, pay-here conference about changes in the tax season. Below, Gregory Neylan, account manager for TRS Tax Max (left) talks with Giovany Ballaralles of Miami-based BCG International Corp.

said. “You can’t sell two months worth of cars in two days. It’s impossible.” He discussed the tax season and the problems of the Path Act during the National Alliance of Buy-Here, PayHere Dealers fall conference. He said because of the changes in the law and the

challenges of the market, dealers need to ind a tax partner to learn how to succeed in this area. “If they don’t, then they need to come to trade shows like this,” he said. “They need to go to NABD, NIADA (National Independent Automobile Dealers Association) and sit in these sessions and meetings.” Neylan also speaks at state IADA events about the

changes. Ingram Walters, of Grifin’s Credit Quick in Monroe, N.C., pushes a promotion to boost sales during income tax season – which has already begun for him. “Fortunately, we have the money to start stockpiling,” he said. “So we start stockpiling in October, November and December.” This helps increase proits because cars become pricier after the irst of the year. “We think a $5,000 car is going to jump at least 10-12 percent,” Walters said. “So if you wait until February, that $5,000 car is going to cost you $5,500 or $5,800.” Historically, February is Walter’s best selling month, but the earlier dealers can start making tax season sales, the better. Once a customer gets their check, they can take it anywhere, Walters said. He said statistics show that most of his customers will spend their entire refund in 24 to 48 hours. The key is to close a deal before they get the refund. “The creative dealers are starting in November,” he said. Walters starts working customers in October and November, asking them about their previous year’s tax return amount. Knowing that, he can estimate what their refund will be this year

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and base the deal on that. Walters uses the TRS Tax Max program that sets up tax return service right in the dealership, securing the deal before the government even sends the checks out. “We prepare the returns,” he said. “We’re also advertising, ‘Buy a car now, pay us when you get your taxes done here and we’ll wait on the down payment. “It works for us.” By getting the deal done early, it takes the customer out of the market before they check out another dealer. “Your customers will love it, but your competition will hate it,” Walters said. The key is to get customers to commit as early as possible, Neylan said. The refunds of buy-here, pay-here customers are substantial. “Last year, 40 percent of the refunds we processed were over $6,000. Ten percent were over $9,000,” Neylan. “If you’re not active during tax season, your customer is going to spend it somewhere else.” A typical buy-here, payhere customer is a single parent, making about $20,000, with one or two children with no taxes withheld. “How much do you think their refund is?” Neylan asked the conference attendees. “It’s $8,388. That’s crazy money.”

Even with the new rules, taxpayers can still ile returns as early as Jan. 2. Neylan said his irm’s tax preparation program allows their dealer clients to provide an advance on their refund starting Jan. 10, up to $2,500, “in two to four hours on their printer.” The other option is the dealer can still handle the customer’s return and close the car deal. Then the dealer can wait until the refund comes in late February. In that case, the money goes directly from the IRS to the dealer. Another option is “irregular payments” in which the dealer builds the tax return into the payment plan. A customer pays $300 a month, for example, until February, the month of their tax return, and that payment could be $1,200, then back to $300 the next month. Whatever dealers decide, they have to change to make tax season successful. “If you do nothing, you’re going to have another crappy January and February, I promise you that,” Neylan said. The common complaint from dealers has been that tax season isn’t the same anymore. “It’s not the same,” Neylan said. “They’re thinking of tax season in the ’90s. “Those days are gone.”

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10 •November 6, 2017

USED CAR NEWS

Dealer Shot During Spree WILMINGTON, Del (AP) – A Delaware used-car dealer was shot in the head during a multi-state killing spree in October. Radee Prince shot Jason Baul, the owner of Baul’s Auto Sales, at his store Oct. 18. Prince went to the store after shooting several people at a Maryland granite company, killing three. Baul survived the shooting. According to press reports, Baul and Prince were old friends. However, Prince was arrested for allegedly assaulting Baul last year at

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Baul’s father’s funeral. Those charges were dropped. Prince had more than 42 arrests in Delaware, and several more in Maryland and Washington. In 2003, he pleaded guilty to 15 counts of burglary in Delaware, and was sentenced to 25 years. However, 23 years were suspended, and he served only two years behind bars. Prince faced multiple assault charges between 2001 and 2003 in Delaware, but they were dropped or dismissed. He also faced charges in 2014 and 2015.

USED CAR NEWS

November 6, 2017 • 11

RETAIL MARKETS ILLINOIS Mark Anderson, owner, Anderson’s & Sons, Newton, Ill.: “I’m a partner with my son, Zach. We oicially opened in April. We started with about 25 vehicles. We have over 150 now. “I’ve bought individual cars of Facebook Marketplace, but about 99 percent of our stuf comes from auctions. We go to ADESA auctions in St. Louis and Indianapolis. We also go to Wolfe’s in Terre Haute, Ind. “Our growth has exploded over the last few months because of our marketing. We’re selling about one a day on average. “We’re probably 75 percent buy-here, pay-here and 25 percent cash deals. That’s a pretty decent mix, although we’d like to get the cash deals up more to help ofset the capital requirements of buy-here, pay-here. “Our retail price point is around $5,000. Our average model year is 2004. Mileage is probably in the 170,000s.

“Our typical down payment for buy-here, pay-here ranges from $500 to $800. The term length is anywhere from 18 to 24 months. “We started as a $10k-andless lot, but we’re probably at $6K-and-less now. We’re in a rural setting. To try to get too much down payment is diicult, so if the price point is up there then we’re more into the deal than we want to be. “We probably carry 40 percent cars, 25 percent vans, 25 percent SUVs and 10 percent trucks. “We are basically all domestic. For the recon, it’s extremely easy to get domestic items. “On average, reconditioning is about $200 to $300. “If I know a vehicle’s got a blown engine – and I know it’s a good model – I have no problem buying that and putting an engine in it. But we have got to buy it right. “We do both (in-house and farm work out). We have one lift now. We’re going to need to add on another building.

Right now, we’re tight on space and our recon process is pretty cumbersome. “We got a little bit out of print. I decided to do a little bit of social media marketing and it exploded. Today, we invest a lot in social media. We spend a lot of money on Facebook. “I recently sold a 2008 Ford Taurus. It had 175,000 miles. Out the door it was probably $5,700 or $5,800.”

OKLAHOMA Jim Holman, owner, The Car Store, Oklahoma City: “I’ve been in business since 2001. “We keep around 100 cars on the lot. We sell about 65 to 70 units a month, but we actually lease them. We’re exclusively a lease-here, pay-here operation. “I had a long new-car career and got into leasing through new cars because it was so popular. We just thought the application would work really well in buy-here, pay-here. We started it without looking

Compiled by Jeffrey Bellant around to see who else was doing it. It’s just another way to inance a car. “The price of oil drives our economy here generally. Our customer may not be in the oil business, but whoever is writing his paycheck is affected by it. “The typical term is 36 months and the typical payment is $400 a month. “A higher number than we ever anticipated (buy the car) at the end of the term – about 11 percent. Other times they move into another car. “Our repossession rate will run about the same as a typical buy-here, pay-here lot at about one out of three. “We get our inventory primarily from auctions and wholesalers. The (wholesale) price of the cars we get is in the $6,000-to-$7,000 range. We get as many of those as we can from the local metro area (to cut down on shipping costs). We use Oklahoma Auto Exchange and Dealers Auto Auction of Oklahoma City.

“The average retail price is about $12,000. “The mileage of our vehicles starts out in the 75,000to 80,000- mile range. The average age is six years old or newer when we irst get them. “We don’t (focus on) domestics or imports. We use the term ‘fetch factor.’ What will it fetch? Part of the fetch factor is not only the priceto-payment relationship, but also the reliability factor in a world of poor maintenance habits. Even if we give free oil changes with the lease, we still have a problem getting them to come in for that free oil change. “We’re about 65 percent passenger cars, 20 percent vans and the rest are SUVs and crossovers. Trucks don’t meet our business model. We like vans because they’re our lowest repossessed vehicle by classiication. “Typical reconditioning costs are about $800. “We recently sold a 2010 Hyundai Elantra. It had about 85,000 miles.”

12 • November 6, 2017

USED CAR NEWS

WHOLESALE MARKETS LOUISIANA Jacob Warren, assistant general manager, Louisiana’s 1st Choice Auto Auction, Hammond, La.: “We’ve been in business for 15 years. “We have six lanes and we are running six lanes currently. “Our volume averages about 650 consigned per week. That’s typical of this time last year. “Average percentages are about 65 percent sold. “Fortunately, we dodged the big storms that hit just east and west of us. Our market is starting to show a little bit of a shortage, as far as consignment numbers. So sales percentages are actually increasing. “We are primarily a dealer consignment facility. I would venture to guess our mix is 80/20 – dealer to institutional (units). Our institutional includes bank repos, lease returns, etc. Some of our institutional consignors are ARI, which

is huge. We also run CPS (Consumer Portfolio Services) and UAC (United Auto Credit), PAR, etc. “Repos are actually increasing somewhat, it seems. “We have an average attendance of about 350 (bidders) each week. That’s trending about the same as this time last year. “However, our simulcast numbers have seen a boost. I would say the last eight to 10 weeks, there are about 30 percent – on average – buying online. We’re getting a huge online presence. But even the majority of those online buyers are (based) within a 150-mile radius of the auction, if I had to guess. “We’ve geared ourselves to be strong in the simulcast area, as far as technology goes. We (like to be) stateof-the-art in technology. Online we use Edge Pipeline. “Our key to success is – No. 1 – our employees. But No. 2 is our customer service. Our service is second-

to-none. “The numbers tend to double for those events. We probably consign over 1,000 for those sales. “Everything is selling well. The mid-range sedans, obviously, are selling well. We’re also had a peak in trucks. Trucks are kind of expensive now. “We’re doing good. We’re lining up some major new accounts. So things are looking very good here.”

TEXAS Luke Pidgeon, general manager, El Paso Independent Auto Auction, El Paso, Texas: “We’ve been in business six years, turning seven in February. “We have four lanes and we run four. “Recently, volumes have been around 350. That’s about the same as this time last year. “Conversion rates have gone up lately. Inventory has been lower so percentages are up. We’re around

54 percent. “The storms didn’t afect us directly, but some dealers were shipping truckloads of their cars to those markets, trying to take advantage of the (demand caused by the hurricanes). So that afected us (briely). “We’re drawing about 150 to 200 bidders. They are mostly local, but we do get some dealers from Albuquerque, N.M., along with Midland and Odessa, Texas. “Dealers are saying business has been down a bit. That’s the word I’m hearing as I talk to other auctions. “It’s just been a weird year. I can’t put my inger on it. “Our local economy has been steady. It’s always steady. There are no real spikes. We have the oil industry and we have one of the largest military bases in the world in Fort Bliss. “We run about 60/40 for our consignment, with 40 percent being the institutional business. We’ve gained some new accounts. “Our big institutional con-

Compiled by Jeffrey Bellant signors are Ally, GM Financial, Santander and Chrysler Capital. “We do an in-op sale before our regular sale. We run about 20 to 30. “We also do a monthly GSA sale. Their volumes are down as well. It’s decreased during the last three or four years. They will run 40 to 50 (units). Those are mostly passenger vehicles, but it can be all across the board. There are some buses, some tractors and cube vans – things like that. It continues steady throughout the year. “The average price inlane is between $7,000 and $8,000. That’s probably a little bit higher this year because of the increase in leet. They bring more money and out-of-town buyers. “Like everybody, trucks are up. “Typically, over the last couple of years, we inish out the year strong, which has been great. So I think we’re going to hit the end of the year with a full head of steam.”

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USED CAR NEWS

November 6, 2017 • 13

DISCONNECTED JOTTINGS FROM Red is the new black. At least that’s the way it seems as far as the car palette is moving. The boring, staid and conservative hues of

TONY MOORBY

competition. My sales manager thought I was nuts at the time, but we made the national papers and sold a bunch of cars.

Tony Moorby • 50-year veteran of the industry • President from 1997–2000 of ADT Automotive • Served as ADESA’s executive vice president of sales and marketing • Moorby & Associates 2006–present • Awarded the Ring of Honor by NIADA • NAAA Hall of Famer

black, silver and white are being eclipsed by more adventurous and showy colors – signs of the times as we get over the recession and shift toward another rising stock market with the usual American optimism and desire to move on, Trump notwithstanding. I’m old enough to remember Slime Green and Plum Crazy from Mopar back in the sixties – I even reinished a 1970 Vauxhall Viva in Plum Crazy for a sales

According to some press observers, yellow is becoming popular again, along with orange and French blue – a Ford Focus SST in Electric Blue looks cool enough to beat the band and BMW has a metallic denim blue that sets a 3 Series apart from the rest of the traic. Don’t hold your breath for green unless it’s bright lime green for something like a Dodge Challenger with lots of galloping horses to back up the boasting bravado and

ego. You have to wonder how long all this horse power will be available and it’s tempting to think back to the late ‘60s and ‘70s as we celebrate and highly value the muscle cars of that era. History repeating itself? I know electric cars will be the norm in a few years’ time so what’s going to replace the heart-thumping grunt and roar of a V8 with straight pipes? The politically correct gang may get their jollies of by listening to the wimpy whirr of an, admittedly powerful and torque-illed motor but it’s hard to get there. Then there’s styling. The front of the latest Tesla looks as interesting as a Westinghouse refrigerator. I recently wrote a few lines about European styling but the Japanese direction looks as though they’re adding lumps and bumps just for the hell of it. The latest Honda Civic Type R looks more like a running shoe than a car, with intakes and delectors

C R O S S WO R D 27. Vectra maker 28. Ford SUV 29. BMW series 33. Drink served hot and cold 34. Way to ride a convertible, 2 down 35. Reo maker 36. Code of life 39. Metallic autotrim 41. Ford’s luxury brand 44. Hyundai 4-door 45. Detroit’s founder Down 1. Maserati sports car 2. Honda model 3. Where sales events are oten held

coln’s design department of late, seeming to lack any real direction or inspiration as they clung to the ‘waterfall grill’ which made the rest of the car look wishy-washy. Now they’ve given up on that, their new clean lines look classically elegant and may make their sales igures look a little more attractive too. Interior designs confound and confuse this old fuddyduddy and as we tell people not to text, we assert that it’s safe to ind another radio station or stream some new music without taking your eyes of the road. Voice control still has some way to go and speaking to your car feels distinctly idiotic to me. What’s that expression about the irst sign of madness? It’s not when you start talking to the chair – it’s when the chair starts talking back! I think we’re there. Maybe cars will start using as colorful language as their new livery.

Digital version available at usedcarnews.com

By Myles Mellor

Across 1. Audi A4 Allroad ___ 6. Subaru SUV 11. Snack 12. Educator Bill 13. Afordable subcompact from Hyundai 14. Car make until 1986 15. Car maintenance must 16. Radials 17. Cadillac SUV 20. Angeles preceder 21. Surprise expression 22. Bidding locale 24. Doctor of Science, for short 25. Luxury car

all over the place. The Hyundai Veloster is not dissimilar. The bodies have pleats, humps, vents, bulges and things that go bump in the night. Maybe it has to do with manliness – the size of the codpiece relective of abilities! Talking of bulges, the hood of the Ininity QX80 looks like the head of a narwhal – heaven forbid it should grow a tusk! Its stable mate, the Nissan Armada, is surely misnamed; the Armada was a dismal, Spanish, naval failure. And they continue to make cars that have rear ends that look like the north end of a southbound camel – see Juke or Leaf if you don’t believe me. Rolls Royce found out that you can literally “put your foot in it” when they wanted to call one of their models the Silver Mist when, in German, mist means dung – they took steps to avoid that one. I’ve been critical of Lin-

4. Rodent 5. Overtime, abbr. 6. Tracks 7. 80s Ferrari 8. Occurring every year 9. History making pitcher, Young 10. Edgy type of entry 14. Shut down, as an engine 18. Caravan maker 19. Mitsubishi SUV 23. Driving no-no 25. ___ Grand Cherokee 26. __ Unser 30. Swedish wheels

14 15

19 21

22 25

35 36 39

43 44

32. Lexus parent

Solution to the 10/16/2017 puzzle 1

company

O 13

I O

S N

N B

E 27

T T

E 30

A M

M D

A 23

40. Color

38. ___ lock brakes

K 11

37. ____ Romeo

31. Discouraging

42. News channel

E 38

O 43

words

43. Clippers’ state

Solution to this puzzle in the 11/20/17 issue. Call 1.800.794.0760 for a FREE subscription.

B 44

A 39

Y W O

I 47

14 • November 6, 2017

USED CAR NEWS

AROUND THE BLOCK

Compiled by Jeffrey Bellant

EVENT SUPPORTS MENTAL HEALTH CENTER Auctions Help

HELPING HANDS: David Blake (center left), and his staff present a check to Scott Sciuchetti, development director of Valley Cities Counseling.

DAA Seattle teamed up with dealers during its August Helping Hands promotional event sale, raising $22,500 for Valley Cities, an Auburn, Wash.-based community behavioral healthcare center. The auction has contributed funds, food and clothing for the past three years to the center.

“Everyone has known someone who has struggled with depression, addiction or mental illness,” says Dave Blake, DAA Seattle’s general manager. “We partner with Valley Cities because they provide services for people right here in our community, helping them to transition

out of seemingly hopeless situations.” The auction employed several fundraising methods during its Helping Hands Sale. Staff members created themed gift baskets that were auctioned, in addition to a prime, front row sale day parking spot and complimentary shuttle service to and from Seattle International Airport for one personal trip. Some sellers purchased special Helping Hands stickers for their consigned units, while others donated money with each sold unit. Limited edition caps were sold, and the auction ran a 50/50 cash raffle that the winner donated to Valley Cities. Together with DAA Northwest and KCI Kansas City, DAA Seattle is a member of the McConkey Auction Group. All three locations are ServNet auctions, served online by Auction Edge.

Hurricane Victims The W. Walker Auctions reached out to help area residents afected by Hurricane Harvey. With help from the owners of State Line Auto Auction and TPC Management who made donations, the Walker family (owners of Corpus Christi Auto Auction and San Antonio Auto Auction) identiied four Port Arkansas, Texas, families who had lost their homes during the storm. The Walkers also helped two auto dealers who lost their homes and saw their stores suffer major damage. Both dealers are customers at Corpus Christi Auto Auction. “Because of the support of others in our industry, we were able to help our neighbors in need,” said Wade Walker, president of the W. Walker Group. “The ties that bind us transcend our businesses, and made a diference to those who had suffered so much.”

We invite news items and top-quality photos from our readers to be considered for “Around the Block.” Please include the name of a contact person and a telephone number. Send items and photos to: Jeffrey Bellant. Mail: Used Car News, 24114 Harper Ave., St. Clair Shores, MI 48080. Fax: (586) 772-9400 e-mail: jeff@usedcarnews.com

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