Used Car News 10/12/2020

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Used Car News

usedcarnews

10/12/2020

Independents Embrace Digital Model

By Ed Fitzgerald

karglobal.com

In This Issue:

• NIADA • Floor Planning

Rush - Dated Material

• Economy

Many independents were embracing digital retailing before COVID, but others may now be taking a closer look at the Carvana model.

Three independent car dealers led a discussion at the NIADA’s virtual convention on ways smaller dealers could improve their online business to compete against the bigger chains. The session was titled, “The Carvana Effect, Driving Customer and Engagement and Increased Sales Through Online Retailing.”

The car business has been consistently moving online over the past decade, but that process has been speeded up by COVID-19, a virus so prevalent it has even reached the president of the United States.

David Brotherton, a Twenty Group moderator for NIADA (National Independent Automobile Dealers Association), asked the dealers what significant changes had occurred at their stores since the pandemic began.

Jeff Watson, owner of 4 Seasons Auto Sales in St. George, Utah, said his company started retraining its workforce.

“So much of the old-school sales process was to get the customer into the lot,” Watson said. “Get them here, get them in front of you, and get them to buy emotionally into the car. And then maybe we squeeze them for a little more down payment to fit the CAC (Credit Acceptance Corp.) model.

“Once they’re in love with the car it’s easier to get them to borrow from mom or grandma or whatever you’ve got to do to get that down payment extracted. Online we ask: ‘Well, what kind of down payment do you have?’ ‘Well, I’ve got this.’

OK, I’m going to take it. I don’t have you here to emotionally kind of put the screws in and go down the

whole sales process.”

Watson said he has found that his customers are preferring to do business via text.

“We don’t do it in person, we don’t even really do it over the phone,” Watson said. “Ninety percent of our sales process is handled via text message. We’re getting responses that people want to communicate that way.”

Tim Gaylord, president of Gaylord Sales and Leasing in Aurora, Colo., said his business model is a little different than most dealers.

His business doesn’t have a public lot.

“We have zero drive-by traffic, so we rely 100 percent on online leads.

Transparency has always been part of our business,” Gaylord said. “If we’re doing a virtual walk-around with FaceTime, we disclose any imperfections that we decided not to fix, usually cosmetic on trucks. COVID actually increased our business because customers couldn’t go to their traditional lot and look around, the CARMAX or AutoNations. So, everybody started going online and the demand increased. And we’ve been doing it that way since 2008, either by text or email.”

Bill Metzinger, CEO of Red, White and Blue Autos in Ashland, Pa., said his store has always tried to be transparent with what they said to customers over the phone.

“We don’t like to spring a lot of stuff onto people when they walk into the showroom,” he said.

“But now everything’s out there. We put (online) price, payments, a link for all of our warranty items. Pretty much everything possible that a customer might want to know.”

Pennsylvania dealers faced a stricter COVID shutdown than in some other states.

“It was six to eight weeks that we were closed down,” Metzinger said.

“We figured it would be an extended period of time until we could have people into our store. Our state government allows us to now

Continued on page 5

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NIADA Convention 10/12/2020

Acquiring, Turning Inventory Quickly Beats One-Time Profit

By Jeffrey Bellant

Find inventory that turns quickly, even if the front-end profit is not large.

That was the message from top independent dealers Brenna Stansberry, of Park Marina Motors in Redding, Calif., and Joe Mok, of Gmotorcars in Arlington Heights, Ill. The pair spoke in a session on inventory acquisition during the 2020 NIADA/NABD Virtual Convention and Expo Series moderated by Chuck Bonanno, NIADA’s vice president of dealers.

Mok said Gmotorcars has been in business 10 years and is located near Chicago.

“We carry between 100 to 120 cars and we’re an 80 to 85 (units soldper-month) store,” he said.

Asked about how he normally sources inventory, Mok cited Carmax auctions, Manheim, independent auctions and ACV.

“We also get a lot of fleet and rental,” Mok said. “Although those vehicles are not real profitable, they do bring in a good amount of trades.”

Mok said there is also opportunity on back-end profits.

Stansberry, whose dealership is located in Northern California, carries between 80 and 100 vehicles in stock.

“Right now. We are currently selling between 50 and 60 per month,” she said. “We normally source inventory from what would be a local auction – for us – which is two-anda-half hours away.”

The dealership uses auctions and a buyer in the state of Washington, she said.

At the start of the pandemic, Mok and Stansberry went through what other dealers went through.

“I remember going to my wife and saying, ‘I think this is the end, I don’t know if we’re going to survive this,’” Mok said.

But he and another employee, who

were essential workers, decided they would “hammer through it.”

After watching cars “depreciate to nothing” and many auto forecasters preaching gloom and doom, Mok saw things change.

“All of the sudden, our phones started to ring and people started to buy cars,” he said.

The rental industry de-fleeted, thinking travel wouldn’t come back.

But Mok said while people weren’t flying, they still were traveling and the rental industry had to buy inventory back.

Once the first 30 to 45 days passed, it’s never been a better time to be in the auto industry, Mok said.

Stansberry said at the beginning, she had “deep concerns” like everyone else in terms of which way things would go.

“Was it going to tank like the experts were telling us?” she said.

Flooring reps were calling Stansberry and telling her to be careful and questioning why she was buying

inventory.

“I bought a lot of cars while a lot of people were telling me not to buy cars,” said Stansberry. “They said, ‘You’re crazy.’

“Well, I’ve been in this business 26 years and it’s the first time in those 26 years I’ve been able to buy a Toyota Tacoma five grand back of wholesale book,” Stansberry said.

In hindsight, Stansberry said she wished she would have bought every vehicle available to her.

Stansberry said the business has had record sales for three or four months.

“I never expected it,” she said.

Stansberry said the biggest thing she missed about the shutdown of physical auctions was the personal relationships with friends and talking to other dealers in the lanes who might see things a little differently.

“It has made me a little bit more diligent of a buyer,’’ she said.

Continued on page 6

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Floor Planning

UCN usedcarnews

10/12/2020

By Jeffrey Bellant

Floor planners urge dealers that now is the time to improve their business and try new things, adding that floor planners will help them along the way.

Scott Maybee, president of NextGear Capital, and Jim Money, president of AFC, discussed floor planning during a panel moderated by Shaun Petersen, interim executive vice president of the National Independent Automobile Dealers Association.

The discussion took place as part of the recent 2020 NIADA/NABD Virtual Convention & Expo.

Money has been with AFC for more than two decades, while Maybee, who joined NextGear in 2018, worked with Nissan out of college and later ran an auction in Minnesota.

Petersen said the three things dealers said they needed during this pandemic were customers, cars and ing product to inventory acquisition cash to buy the cars.

“What has happened in the whole- to safe social distancing (has been sale auto financing market that af- disruptive).”

Jim Money

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Best, Colleen Fitzgerald Publisher 4

Volume 26 | No.10

fects the independent dealer since the pandemic began?” Petersen asked the panel.

A large chunk of the auto financing piece, post-pandemic, “almost feels like business as usual,” said Money.

But he said “the other stuff, from the digital transformation in sourc-

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Scott Maybee

Maybee agreed that independents face a host of challenges, specifically inventory and uncertainty. One challenge for AFC is not being able to be on the lots of dealers on a daily basis.

Petersen said “uncertainty” seems to be the big challenge for independents, especially at the beginning of the pandemic.

Maybee said on the wholesale side, floor plan providers were lowering credit lines in April and May to limit the risk on portfolios.

“I can tell you I might not have been on people’s annual Christmas card lists by making those changes,” he said.

The challenge for NextGear was that it faced uncertainty, too.

New lines of credit were also scarce because of that uncertainty, although it has changed.

“Now, it is business as usual,” Maybee said. However, he added one change from pre-COVID days is that NextGear does require bank statements. He wants dealers to show two to three months of solid financials in terms of keeping cash in their businesses.

“Cash is king,” he said.

Maybee added that retail success helps create wholesale success. But there has been some pullback in the retail financing space, which also affects floor plan businesses.

Money said AFC also lowered lines at the start of the pandemic, which didn’t make people happy.

“We did stop the underwriting process for a short period of time just to get acclimated to what was going on,” Money said. “It was the best of times that became the worst of times in the next week. It happened that fast.”

Like NextGear, once things settled down after April and May, things went back to normal pre-COVID model for AFC. Money was impressed with the way independents navigated this period and credits Continued on page 10

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News 10/12/2020

Digital – Continued from page 1 have people back into our store, but we’re still doing 100 percent online. People are doing documents online and then coming to the store and meeting the salesperson out front to do final signatures with the vehicles they picked out. A lot of that stuff evolved and we’re trying to stay ahead of it.”

Brotherton asked how the dealers were getting customers to buy a vehicle that they haven’t seen, much less driven, like the “Vrooms and Carvanas of the world.”

“Our salespeople are calling the customer up, logging onto the website with the customer at home and the salesperson at their desk, and they’re just talking,” Metzinger said.

“They ask ‘what kind of car are you looking for, are you looking for a sedan, or an SUV, or a van, do you want a four-door.

“So, they search for your Malibus and Cruzes and Sonatas. They’re basically reviewing that car, with the 40-50 pictures we have online, and they have a conversation about what color, and imperfections.

“Sometimes it’s a 45-minute or an hour phone call with the customer, until they get on a vehicle.”

Watson stressed the importance of an online presence and having some sort of a return policy.

“People have seen your Google reviews, your Facebook reviews.

And they’re comfortable taking a sight-unseen delivery,” he said.

“An exchange policy seems like such a scary thing in the used-car world, but it’s not. I think if you talk to any dealer it’s a nonconsequential item that probably hasn’t caused even a hiccup in their business.

“The upside is that the customer has that confidence, that’s why someone shops at Amazon or at Carvana, the return policy. Put it in place at your dealership, it’s not going to sink you.”

Metzinger said his return policy has been a non-issue.

“In the last 400 cars we sold we had one return,” he said. “We delivered a Focus and it was just too small for the family, so they came back and got a Fusion.

“Guys are scared of having a return policy, but if you’re going to do it, promote it and sell on that.

“If your whole store knows you have a 3-day, 7-day or 10-day return policy, promote that. Be

transparent and say you’re offering that.”

Gaylord said that his company has an exchange program, but he doesn’t advertise it.

“It’s something we’re going to do anyways. We don’t want someone out there assassinating our character. It’s not worth it, over one car sale. In 30 years, we’ve taken 12 cars back and made more money on eight of those.”

Brotherton asked what changes the dealers had made as far as paperwork – signing documents and credit applications – in a contactrestricted environment.

“All applications are 100 percent online, through a photo or an upload, occasionally an email,” Watson said.

“The underwriting is all done online, via text. After that, because of our wet signature requirements, I haven’t gone full digital on my sales documents, but I could. I could sign up with SecureClose or a DocuSign and have that expense. But the need to do that hasn’t been there.

So, we still do all our documents in person.”

Gaylord said his company routinely sells vehicles out-of-state.

“We just sold a vehicle to a guy in Florida and we overnighted him documents and had him sign them and ship them back. Once we received that payment we transported the car down there. It just depends on the state.

“Having been in a 20 Group for a few years, the regulations of each state are so different you really need to find out what you can and can’t do in your own state.”

Metzinger said that pre-COVID he had two SecureClose offices inside his store.

“There were always one or two state forms that the customer had to sign at the front desk before they left,” he said.

“Post COVID, even though I love SecureClose, and we may be shifting back down the road, we moved over to DocuSign. Our staff loves it.”

The three dealers also recommended that smaller dealers practice the family, or personal, touch. Metzinger said his dealership gives away turkeys at Thanksgiving and bicycles at Christmas.

“The Carvanas aren’t going to be sponsoring somebody’s softball team,” he said.

Used Car News 10/12/2020

Inventory Acquisition – Continued from page 3 “I’m still old school. I want to touch it, see it, feel it.”

Mok joked he would only go to a physical auction because he likes the popcorn and lunches.

“Totally bidding online is so much more useful than going to the physical auction,” he said.

Bonanno asked about alternative sources for cars.

“The best advice I can give anyone is to go with the path of least resistance,” Mok said.

Buying a $15,000 Toyota Camry, putting it on the lot for $15,500 – lower than anyone else – is going to blow up the phones.

“You’ll be able to sell a warranty, get some back-end on the financing and a beautiful trade out of it,” Mok said.

Chain auctions charging large fees cannot compete with the local franchise stores when it comes to acquiring inventory, Mok said.

Stansberry said once a week she puts an ad up on her Facebook Business page that she buys cars, paid off or not.

“I try to mix it up and make it sound different,” she said. “But we always get leads from that – always, always, always.”

Stansberry said she’s also spending time on Facebook Marketplace, a source she rarely used before.

When it comes to buy fees, instead of paying auctions, she pays her employees “buy fees” to find cars.

So, an employee who finds a nice car with a “for sale” sign on it at the local supermarket gets some extra money.

Stansberry said during this time, she has never seen Kelley Blue Book adjust prices so quickly.

“Kelley Blue Book changes every Friday, so I am repricing my cars every Friday,” she said. “If I see something that’s not moving, I’m on it

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right away. Why is that car not moving? Why is it becoming old? We’re doing more than ever before to find out why a car is not selling and adjusting prices.”

She wants to sell something now rather than 90 days from now when she will lose money.

The key is what can you sell a car for and how fast can you sell it, Mok said.

Stansberry and Mok both believe that turn rate is everything.

Stansberry said she’s had to challenge her father’s “old school thinking” that you have to stock 100 cars to sell 50.

“I don’t buy that. I believe that you can manage your assets so much better by carrying 80 to sell 60,” she said. “I’m not going to buy more cars just to have more cars on the lot.”

In August, the turn rate for her trucks was 12.

“I’ve hit nine on my cars and SUVS,

but I’ve never hit 12,” she said. “I never thought that I’d be thanking something like COVID for helping me out with my asset management.”

Mok said he gets excited about turn. He hit a turn of 13 at the 28-day mark in September.

“Also, you have to go with your gut,” Stansberry said. “You have to know what’s good for you. When I was told I was crazy for buying cars back in March and April, I was like, ‘I don’t agree with you guys.’’’

But it always came back to buying the cars that sell the most.

“Don’t hold out for the big gross,” Stansberry said. “If you can make $1,000 on the front and $1,000 on the back, turn it and buy another car.

Don’t pass up a deal. Wholesale it if it’s not selling.”

Like Stansberry, Mok said he doesn’t hold out for money at the expense of a sale.

“Turn and burn.”

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Manheim Dallas November 10 877-860-1651

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Manheim Fredericksburg November 12 540-368-3400

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The Jaguar word mark, the Jaguar logo, and Jaguar Financial Group are trademarks of Jaguar Land Rover Limited and any use by JPMorgan Chase Bank, N.A. ("Chase") is under license. * The Land Rover word mark, the Land Rover and Oval logo, and Land Rover Financial Group are trademarks of Jaguar Land Rover Limited and any use by JPMorgan Chase Bank, N.A. ("Chase") is under license.

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The tradename "Subaru Motors Finance" and the Subaru logo are owned / licensed by Subaru of America, Inc. and are licensed to JPMorgan Chase Bank, N.A. ("Chase").

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Economy 10/12/2020

U.S. Chamber Reports Challenges Ahead for Economy

By Jeffrey Bellant

The U.S. Chamber of Commerce sees automotive and manufacturing sectors are “recovering sharply” and, though used retail sales are slowing, inventory remains tighter and retail prices are strong but “plateauing.’

The Chamber sees the overall economic recovery is more “K-shaped” than “V-shaped” as the country fights back from the coronavirus.

That was the message of Curtis Dubay, senior economist of the U.S. Chamber of Commerce, during a session of the NIADA/NABD Virtual Convention & Expo.

The National Independent Automobile Dealers Association held its annual convention virtually via three full-day sessions over three weeks.

The K-Shaped recovery occurs when not every sector experiences

the same recovery. Some have a traditional strong V-shaped recovery, while others do not.

“You have two things going on,” Dubay said. “You have some industries and some sectors at the top of the ‘K.’ They are experiencing rapid growth and experiencing a ‘Vshaped’ recovery.

“But you have others that are on the bottom side of the ‘K’ and they are not experiencing a recovery.”

Like auto and manufacturing, tech companies because of the boost in online business, are doing very well.

Some retailers who have a strong online presence, are also experiencing a good recovery.

“The flip side of the ‘K’ are the food and beverage industries, some brick-and-mortar industries and travel-and-tourism and other types of businesses that cannot reopen at all because their business requires people to be in close contact,” Dubay

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2

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1 The tradename “Subaru Motors Finance” and the Subaru logo are owned / licensed by Subaru of America, Inc. and are licensed to JPMorgan Chase Bank, N.A. (“Chase”).

2 The tradename "Mazda Capital Services" as well as the Mazda and Mazda Capital Services logos are owned by Mazda Motor Corporation or its affiliates and are licensed to JPMorgan Chase Bank, N.A.(“Chase”).

3

The tradename “Maserati Capital USA” (MCUSA) as well as the Maserati Trident and Maserati Capital USA logos are owned by Maserati S.p.A. or its affiliates and are licensed to JPMorgan Chase Bank, N.A. (“Chase”).

4 The Jaguar word mark, the Jaguar logo, and Jaguar Financial Group are trademarks of Jaguar Land Rover Limited and any use by JPMorgan Chase Bank, N.A. (“Chase”) is under license. The Land Rover word mark, the Land Rover and Oval logo and Land Rover Financial Group are trademarks of Jaguar Land Rover Limited and any use by Chase is under license.

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Dealer communication only; not intended for retail purchaser. © 2019 JPMorgan Chase Bank, N.A. Member FDIC.

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said. “Or they are operating at reduced capacities because of social distancing guidelines.”

Despite that, Dubay sees good signs.

“We are seeing an economy that is very resilient and its tendency is to grow,” he said.

The policy response, especially from the Federal Reserve, has been very good, he added. The fiscal response from Congress and the Trump Administration has also been good.

Despite this good news, the economy is still below where we were during the Great Recession.

“That just goes to show how deep this current contraction has been and still remains,” Dubay said.

Consumer sentiment, according to the University of Michigan, was at near record levels back in February, before plummeting in March and April, he said.

Dubay expects sentiment, which rose in August, will rise in September and continue, depending on what the virus does.

Unemployment, another large factor, remained very high before dipping back below 1 million initial claims in late August.

But Dubay said it’s “stubbornly high” and “frustrating.”

A good sign is that continuing claims have been continuing to fall as people return back to work. May, June, July and August have showed record job gains, Dubay said.

“The issue is that we’ve had over 22 million people lose their jobs between February and April,” he said.

It took an 11-year expansion to get to the 152.5 million jobs we had in February.

“We’re not going to get back to that level of employment anytime soon,” he said.

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NIADA Convention 10/12/2020

Floor Planning – Continued from page 4 them with allowing AFC to go back to normal. Maybee said before June, a new dealer customer was going to have to jump through all the hoops.

However, the situation has improved.

“In the June, July and early August timeframe, we actually saw slightly better credit quality, initially,“ Maybee said. “That was nice to see.”

At the end of August and early September, it’s leveled off to pre-COVID levels.

“For us, it just shows how resilient the independent dealer is,” Maybee said.

At AFC, too, dealers have done all the right things to bounce back.

“They have right-sized their businesses and made the difficult choices they had to make,” Money said. “They went through the same stuff that a lot of businesses went through.”

He said dealers have shown a

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stronger performance than he would have expected to see at this point, calling his dealers “superstars.”

Maybee said going forward, dealers have to focus on people and processes.

They need to make sure they buy correctly, he said, even buying less than what they might normally buy.

Selling is critical, so getting retail eyes on inventory is “absolutely essential.”

That means zeroing in on retail advertising, Maybee said. Also, efficiency is the name of the game.

“For us, we need to become better partners with independents and make sure their interactions with us are seamless,” Maybee said.

For AFC, dealers need to remember that the first loss is sometimes the best loss, and not hold on to cars too long, Money said.

“That’s a challenge for them,” he said.

Dealers may realize they don’t need to sell the same number of cars they’ve had to sell in the past, mainly because they have improved their businesses. Discovering they can do the same business with a trimmed down staff is one example, Money said.

Getting some dealers who were always in the physical space to pivot to the digital space is another challenge, he said. In terms of inventory supply, the manufacturer shutdowns, the hold on repos and lease returns have had a negative effect.

Prices have been challenging as a result, Money said.

At NextGear, Maybee has seen in the last couple of months there is a softening of wholesale prices as supply is starting to come back while demand is still strong.

But he warns that increases in inventory costs could cause credit availability to decrease.

Maybee said the wildcard at press time is a potential new COVID relief package.

“Dealers need to be paying close attention to that from a market perspective,” he said. Dealers that use data and tools to their advantage are the ones that are getting ahead.

Money agreed that dealers need to make moves now, looking at digital retailing and wholesaling. Finding new ways to improve business is critical.

“At the end of the day, sometimes I think you just have to try,” he said.

Maybee agreed, adding that businesses like Blockbuster, Sears and Nokia failed by an unwillingness to adapt.

“Dealers should really understand where commerce is in general,” he said. “I think COVID pushed us a few more years down the road. We knew we were going to get to this point, it just sped up the process.”

Retail Markets 10/12/2020 Compiled by Ed Fitzgerald

PENNSYLVANIA Bert Straub, owner, 1st Choice Auto, Fairview, Pa. “Our dealership has been open for five years. I’ve been in the auto business for 35 years, so I still want to be a steward and a student of the car business. I have a lot of experience in the retail and financing sides.

“For COVID we were shut down by the state for a total of six weeks. No sales. We were able to briefly do some online sales, and now it’s kind of going back to business as usual. It’s just my wife, Linda, and myself. My wife set up the COVID safety procedures. She’s really the backbone of this dealership.

“We’d love to maintain about 25 vehicles in inventory, although that is not as easy as we would hope. So we’re in that 15-20 range pretty consistently. We sell 12 a month.

‘Sixty to 70 percent of what we sell is going to be an SUV. For some reason, everyone thinks they need all-wheeldrive. It’s like the world has forgotten that we survived on manual transmissions and rear-wheel-drive for years.

“We probably sell 60-70 percent domestics. I try to stay more with the domestics only because of the servicing issue and dealing with the subprime market, which I tend to be strong in.

“Credit Acceptance is my No. 1 lender.

“I source most of my cars from auctions. Being in the Rust Belt I try to stay in the fleet sales end of things. We do have Corry Auto Dealers Exchange, a local auction where we tend to find a lot of fleet cars. I do travel to Mountain State Auto Auction in West Virginia.

“My average recondition-

ing cost is probably around $760. I farm everything out.

“My average down payment is right around $1,900.

We’re in the 48-month range (for term length).

“Most of what I do in advertising is a few AdWords with Google, and a lot of Facebook Marketplace, Instagram; social media mainly.

We’ll do something local with the football team.

“Our average model year is 2012. The average mileage is 113,000.

“The last car I sold was a Nissan Sentra, 2010, with 113,000 miles for $6,000.”

MINNESOTA Colleen Lannon, co-owner, Velishek Auto Sales, Prior Lake, Minn.

“We started in 1972 so that makes it 48 years. My dad started it and now I own it with my brother, Tim. My dad passed away about a

year-and-a-half ago.

“We didn’t have to shut down entirely for COVID, but we did have to make adjustments as far as wearing masks and sanitizing our vehicles, and making appointments.

“It impacted us; in March we were down probably 60 percent. Right now, we’re coming back. For the year we’re only down 1 percent.

We did a lot online.

“We like to carry 120-130 cars and that’s been an issue as well, it’s kind of hard to find cars. We’re maintaining about 100 cars on our lot, so we’re doing fairly well. We usually sell around 50-60 cars a month.

“Right now, it’s really hard to get trucks, so we’re probably 20 percent trucks and the rest are cars and SUVs. Trucks are hard to come by. We try to keep the truck prices under $20,000.

“We carry about 75 percent domestics, and 25 percent imports.

“We typically use the Manheim and ADESA auctions, wherever we can find cars.

“Our customers are asked to put 20 percent down, but they have been doing zero to $500. They just don’t have the money to put down.

“The term length is 48 to 60 months.

“We spend $700 to $1,500 per car in reconditioning.

We do the repairs in-house and detail, but if any body work is needed that is subcontracted.

“For advertising, we do AutoTrader, CarFax, CarGurus, Craigslist and Facebook Marketplace.

“The average model year we keep is probably a 2016, with 50,000 to 60,000 miles.

“The last car we sold was a 2015 Chevy Impala with 77,000 miles for $10,000.”

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Wholesale Markets 10/12/2020 Compiled by Jeffrey Bellant

OKLAHOMA Kyle Clopton, director of sales, Oklahoma Auto Exchange, Oklahoma City: “We have four lanes and we’re running between 600 and 650.

“Inventory is down. With the factories shutting down (during COVID-19), the used market has gotten extremely hot. That means vehicles that would typically be wholesale units have crept into the retail market.

“But that’s starting to loosen up. That said, if the car makes it to the auction, we’re selling it. In the last couple of months, we’ve had sales percentages between 76 and 82 percent. It’s made the hustle a little bit harder.

“We’re one of the only sales here that (is open for physical sales). We’ve attracted significantly more buyers from out of state who prefer to buy cars in-lane.

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“We went from not running digitally at all (before COVID-19) to up and running digitally in about two weeks.

“Our volume has picked up in the last month as new cars have started to come back to franchise dealerships.

“I think we’re down 7 to 10 percent on dealer-consignment volume, but we’re up 13 to 16 percent in percentage sold.

“Our average sales price has gone up to $5,978 over the past three months. For the same period last year, it was $4,956.

“The independent dealers that we have are doing really well.

“We’re actually running significantly more fleet/ lease units than before. I think a lot of that is also about dealers being in-lane.

We’re willing to do lots for the fleet/lease accounts. It

pays off for us.

“When my dad started the auction 15 years ago, he said ‘If we don’t serve you, we don’t deserve you.’ That’s the way he looks at it. That’s what we focus on.”

WISCONSIN Kristi Litizia, president, Greater Milwaukee Auto Auction, Milwaukee: “We’re doing great. We’re at full staff, full steam and running live auctions.

“We are running 600 units a week. (Last year) we were running between 700 and 800 at the same time.

“But our percentage this year is a lot higher. We’re selling between 70 and 80 percent every week. In the past, we’d sell between 60 and 65 percent.

“The fleet/lease/repos are running 90 percent, while fresh new-car trades are running close to that as well.

But we do want to increase our consignment back to what it was.

“Fleet/lease/repo makes up 10 percent of our volume.

We’re 90 percent dealer consignment.

“All of our lanes are online.

We have Ally Financial and we have Midwest Car Corp., which are late-model GMs. “We use Edge online.

“We’re running totally normally, with both in-lane and online bidding.

“I have to say the online bidding sales percentage has increased exponentially.

“We like in-lane because dealers square off against each other and the cars sell for more. Dealers are very happy. They are very profitable right now.

“Our average price in the lanes is about $4,000. That’s about typical for us since we’re mainly a dealer consignment sale.

“With the election coming up in one month, we have absolutely no idea of what the effect will be on the market. But we are excited to see (what’s next).

“The dealers are really grateful that we have a live sale and are running cars through the building and that we’re back to normal.

I’ve heard a lot of great feedback on that.

“There’s more to an auction than just buying cars.

They’re watching the market. When they go back to appraise cars, they can see what the other cars are doing. They can make the decisions just by walking through the lanes.

“There are a lot of things happening at the auto auction that are educational and informative for the dealer base.

“We’re grateful to be able to provide that.”

WE ARE OPEN! WELCOMING DEALERS & DRIVING VEHICLES THROUGH THE LANES!

Disconnected Jottings From

Tony Moorby 10/12/2020

I was planning a road trip about this time last year; a “Bourbon Trail” revisit with my brother and my buddy, Doug. It involved going from place to place across Kentucky, often retracing footsteps to visit a different distillery. The trip’s worth taking for the scenery alone.

I know there are different types of software these days for doing this sort of thing but still being a bit slow on the technology up-take, it’s simpler to point a finger on a map and make the necessary notes to plot progress.

I’ve had U.S. road atlases in my cars since my arrival years ago, initially prompted by an inquisitive mind about my new surroundings. They’re all well used and dog-eared and to be honest, the print’s too small for my aging peepers.

I went to Barnes and Noble, the famous book-

store folks who still maintain a presence here locally in spite of Amazon. I still love to browse around the shelves enjoying the tactile presence of the books and magazines and eventually I made my way to the central service desk. A young lady was busy eyeing a computer screen and asked if she could help. “Where can I find atlases, miss?” Her head bobbed up from the computer. “Beg pardon,” she replied. I repeated the request. “Who’s the author?” she enquired further.

It was my turn to ‘beg pardon.’

“Who wrote it?” she asked, as she was ready to pounce and enter the name into her keyboard. “McNally!” I countered, “Rand McNally” in that James Bond confidence, lifting one eyebrow in expectation of an “Oh, of course.” It didn’t come.

I wandered away to a lady who looked like a school ma’am at the checkout counter. She showed me to the large print road atlases without a second thought.

I was, at first, shocked and dumbfounded by the encounter but came quickly to realize that it would never occur to the young clerk to search for a town when her phone would do it in gig time.

It’s another reminder of what was, isn’t any more.

A Bible quote comes to mind, although I can’t point to the book or the verse; “we shall all be changed, in a moment, in the twinkling of an eye.” The pandemic is forcing so many changes and so fast, most of which will alter our lives in fundamental ways to the point where we won’t go back to the previous set of parameters that steered our thinking.

By Myles Mellor

Across 1. Aston Martin model 4. Deville makers 8. Lamborghini’s “little bull” 10. Hyundai sedans 12. Grazing ground 13. Honda model 15. The first of these VW models were hatchbacks 17. St Paul’s state 18. Silvery-gray 21. Headlight sends it out 22. Hot stuff 24. Former Saturn sedan 27. One of Greyhound’s fleet 28. Belief system 29. Former Jeep model 30. One billion years

31. Climbing plant 32. Technology giant 34. Ford in-vehicle system 36. VIP vehicle 37. Bag 39. Toyota hybrid 40. Former Isuzu SUV 41. Dangerous road surface 42. Make, as profit 43. Horn blast 44. Air conditioning, for short Down 1. VW SUV 2. Panamera or Taycan 3. Medical pro 4. Low-cost 5. Genetic stuff

Ironically, quarantining and social distancing have only served for us to yearn for things the way they used to be; something as simple as going out to eat without nervously scanning a bar code to transfer a menu to a phone and looking like a bank robber or a surgeon in the process. Getting together with friends and family without getting jittery and jerky over who’s been where and with whom or jumping on an airplane with the same concerns. It would be nice to stroll around a mall and nip into Macy’s to use the restroom without feeling the dice is loaded.

Picking up where we left off won’t be possible or even wise – it’s literally a new world out there. To deal with whatever awaits in our collective futures we’re going to need broad imaginations. New judgments of

• 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 • NAAA Hall of Famer • IARA Circle of Excellence To see past columns from Tony Moorby, visit www.usedcarnews.com/ columnists/tony-moorby

well-being will have to be made – more about health than money.

In a society that has become more fractious in the past few years, we are going to need a generosity of spirit and bring back that ‘live and let live’ sense that makes America feel great.

Play Online at Us e d C a r N e ws. c o m 6. Formula 1 sports brand 7. ___ general rule, 2 words 9. Cutlass maker 11. Former UK car company that made the Talbot and the Rapier 14. Truck owned by Fiat Chrysler 16. Honda SUV 19. Makers of the Kona and Ioniq 20. Makers of the EX 35 and EX 37 22. Auto category 23. Kind of driver no one likes 25. Former Kia sedans 26. Radiator top

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Solution to this puzzle in the 11/2/2020 issue. Call 1.800.794.0760 for a FREE subscription.

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Tony Moorby

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