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General Motors Launches Used Sales Site
Photo by Kristin Craig DRIVING FORWARD: General Motors made technology a major theme of its display at the 2016 North American International Auto Show. The company has announced a new wesbite that allows consumers to shop its pre-owned inventory and purchase them from participating dealers. By Ted Craig
Rush - Dated Material
General Motors is creating a new tier of used cars with the launch of the Factory Pre-Owned Collection, a website for consumers to buy certified used cars. The site will feature a nationwide inventory of more than 30,000 vehicles, all with fewer than 37,000 miles, and including an extended factory bumper-to-bumper limited warranty. The cars will be a mix of lease, daily rental and company-owned vehicles. Tom Kinney, GM’s senior manag-
er of retail planning and incentives, said these vehicles fall into a new category between the average used car and what dealers in the GM certified pre-owned program offer. The program also features a threeday/150-mile exchange program, a three-month trial of OnStar and the Sirius/XM satellite radio. Vehicles also come with roadside assistance and courtesy transportation during the warranty period. Consumers can compare suggested prices on the site to what others in their area have paid using the Kelley Blue Book Fair Market Range.
Customers can also get a Carfax Vehicle History Report on the vehicles displayed on the site. GM CEO Mary Barra said in a release announcing the site that it provides used-car buyers the same experience the company offers new-car buyers through its ShopClick-Drive service. “We know that many of our customers who are shopping for a used car want to complete more of the process online, and that number is growing,” Barra said. That site was rolled out in stages, but the Factory Pre-Owned Collection will go live all at once.
Consumers come onto the site and are connected with a dealer after they have selected a vehicle There are several advantages for dealers, Kinney said. They get a consumer already attached to a vehicle and they can sell cars without having to carry them on their lots. “For the dealer, it’s an incremental lead,” he said. On the corporate side, the site acts as another tool to help maintain residual values, Kinney said. The Factory Pre-Owned Collection site will be available to consumers this month.
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USED CAR NEWS
February 1, 2016 • 3
Manheim Expects 3.1 Million Lease Returns in 2016 DETROIT - It’s still all about the customer. During a recent industry event, leaders from wholesale, retail and communications talked about the speed and breadth of marketing today. But they arrived at the old-fashioned conclusion that taking care of the customer – whether an individual shopping for a car or a dealership wanting to improve its bottom line – is the key to success. Reviewing best business practices, Manheim North America President Janet Barnard, stressed the need to turn inventory every 30 days. “Efficiency is the new currency,” Barnard said. Reducing complexities including time spent on reconditioning, tracking and delivery will help move inventories. Manheim has spent $150 million to make it easier to sell vehicles, introducing second-chance deals for unsold vehicles at auction and printing passes for expedited transport.
At the dealership level, Barnard said, customer wait times are critical. “Shoppers now are left alone 43 percent of their time (at the dealership),” she said. They likely are using electronic devices to check inventory at other, competing dealerships, she said. Staff time spent with retail customers should include asking questions and making connections. “Be a consultant rather than a salesperson,” she said. Manheim forecasts a wave of 3.1 million off-lease vehicles returning to the market in 2016 and up to 3.6 million in 2017. Barnard said Manheim is expecting leasing to increase, with its attendant effect on used car prices. She suggested using data “much earlier upstream” when determining lease car residual values, and “being smarter about pull-aheads.” “We’re a little behind the curve, but with the right tools we can keep values from tumbling,” she said.
Photo by Jenny King HANDS-ON SERVICE: Manheim’s Janet Barnard discusses best business practices during an industry event in Detroit. She said a retail staffer should “be a consultant rather than a salesperson.”
“There’s a lot of demand for reliable, affordable cars,” Barnard said. Following her presentation, Barnard joined Rob Pietsch, senior director of autos for Twitter, and Marti Eulberg, director of brand management for Sonic Au-
tomotive, for a panel discussion of industry changes and forecasts. Pietsch said trends form on his company’s site in seconds. Users often tweet auto preferences and Twitter can serve as a source of validation for a consumer, he said.
Barnard said current studies show that customers use dealerships for test drives and service. They can do price and model searches on their own. Sophisticated communications can provide almost everything the off-site buyer needs.
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4 • February 1, 2016
USED CAR NEWS
NEWS BRIEFS House Committee Says Ally Money Misdirected
The Consumer Financial Protection Bureau is distributing $80 million in settlement proceeds from its enforcement action against Ally Financial and its subsidiary Ally Bank without verifying that recipients are eligible to receive the money, according to the House Financial Services Committee. The result is some white borrowers are getting settlement checks over alleged racial discrimination against African-Americans, Hispanics and Asians. The committee released internal bureau documents as part of a staff report that also reveals the Department of Justice originally objected to the CFPB’s approach but later withdrew its objections.
first auctions began in late 2015.
NAAA Updates Arbitration Policy
The National Auto Auction Association announced that changes to the arbitration policy, structural damage policy and a new flood, puddle or stream policy took effect Feb. 1. The changes come after months of research and discussion by the Auction Standards Committee. The last time the membership saw changes to the policy was May 4, 2015. NAAA headquarters staff is preparing posters for shipment to member auto auctions. In addition to the changes to the policy, NAAA and the Auction Standards Committee posted two position statements to www.naaa.com, one about recalls and one about condition reports. A convenient video outlining the changes is also IAA Expands in Maryland Insurance Auto Auctions Inc. an- available. nounced the opening of the IAA Banks See Auto Finance Growth Dundalk facility in Maryland. Several large banks recently One of five locations in Maryland, the IAA Dundalk facility sits reported their automotive perforon nearly 10 acres, and will provide mance for the fourth quarter. Chase reported 12 percent yearexpanded capacity for the growing over-year growth in auto loan lease Maryland marketplace. The IAA Dundalk facility is lo- balances in the fourth quarter. Charge offs were higher in the cated at 8143 Beachwood Road. The
quarter, but remain below historic expectations. US Bank saw growth in average auto loans of 13 percent over the fourth quarter of 2014 and 2 percent over the third quarter of 2015. Wells Fargo reported auto originations of $7.6 billion in the fourth quarter, down 9 percent from the third quarter, but up 13 percent from the same period last year. Fifth Third Bank was one bank that saw auto finance move in the other direction in the fourth quarter. The Ohio-based bank reports that average auto loans decreased 2 percent from the third quarter and 3 percent from the previous year’s fourth quarter. Net charge-offs in the auto portfolio of $9 million were up $2 million compared with the third quarter.
CFPB Goes After Single-Store Dealer
The Consumer Financial Protection Bureau took action against Herbies Auto Sales, a Colorado buyhere, pay-here dealer. The CFPB claims Herbies engaged in abusive financing schemes, hiding auto finance charges and misleading consumers. Herbies will pay $700,000 in restitution to harmed consumers, with a
suspended civil penalty of $100,000. Y King S Corp., which does business as Herbies Auto Sales, is located in Greeley, Colo. From at least 2012 through May 2014, the company offered financing to about 1,000 people each year. The CFPB says Herbies unlawfully advertised a misleadingly low 9.99 percent annual percentage rate (APR), without disclosing a required warranty, a payment assurance device and other credit costs as finance charges. Herbies is a former Colorado Independent Automobile Dealers Association Quality Dealer of the Year.
Edmunds Offers Appraisal Tool
Edmunds.com rolled out a new product called Edmunds MyAppraise. Edmunds MyAppraise works by engaging Edmunds’ desktop and mobile users who are already logging on to appraise the True Market price of their vehicles. These users who want to sell their vehicles are given the opportunity to solicit offers from local dealers that are partnered with Edmunds. The tool guides them to enter the vehicle’s VIN and to answer a few questions about its condition.
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Used Car News is published the first 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
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USED CAR NEWS
Carolina_TaxTime_UCN Feb 1.pdf
February 1, 2016 • 5
Fence Dispute Riles Dealer
By Sheila McGrath
A new fence being built along a high-speed rail line will leave a Chenoa, Ill., dealer with fewer spaces to display his cars. And he’s not taking it lying down. Mark Johnson owns the Chenoa Motor Co. in the central Illinois town, which has about 1,700 residents. The dispute centers on a piece of land 10 feet wide by 220 feet long on the property Johnson leases. At first he was told the railroad’s fence wouldn’t block that strip of land, but later was told it would. Johnson doesn’t dispute the fact that the railroad has the right to put up fencing, he said. “I’ve never denied that they have a right-of-way, I just want them to do what they agreed to do in the first place,” he said. “Instead, this has turned into an absolute hairball.” The railroad tracks aren’t new. What’s new is the plan to use those tracks to bring high-speed rail between Chicago and St. Louis. Guy Tridgell, deputy director of communications for the Illinois Department of Transportation, said he was not familiar with the dispute and couldn’t comment on it. But according to the department’s
website, track construction and reconfiguration for the project began in 2010, and the work has been proceeding in stages since then. The Illinois Department of Transportation and Union Pacific Railroad have been installing fencing along the 284-mile route to protect the public from the fast-moving trains, which travel up to 110 mph. The new fence “keeps me from backing cars in on the west side of my building – some of my prime display area,” Johnson said. The fencing is typically installed 40 feet from the center of the tracks. When a contractor first came by to look at installing it, Johnson said they discussed the fact that bringing the fence out 40 feet would hamper his ability to display cars on his lot. So the contractor agreed to install the fence 30 feet out instead, something that had been done in other nearby areas, Johnson said. After the contractor installed the fence, he returned and said the railroad told him he had to take it down and move it out the full 40 feet. Because the property is commercial and not residential, Johnson said, the railroad wants him to lease that 10-foot strip for $2,500 a year. “They’re perfectly willing to leave it if I pay them,” Johnson said. “That’s ridiculous.” C
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6 • February 1, 2016
USED CAR NEWS
Ford Wins Loyalty Awards IHS Automotive presented 33 Loyalty Awards for automotive loyalty and conquest efforts. Winners were named in eight featured categories during the event, based on IHS Automotive analysis of new vehicle registrations during the 2014 model year. Ford Motor Company took top honors for Overall Loyalty to Manufacturer, and the Ford brand also was recognized as the winner for Overall Loyalty to Make. “This year’s winners have demonstrated superior performance in their ability to retain their customers among their models and brands,” said Edouard Tavernier, senior vice president at Southfield, Mich.-based IHS Automotive. “As the overall market growth flattens, the competition for buyers returning to market has never been greater. Manufacturers will need to continue to launch great new products to retain their customers, while driving aggressive conquest programs in order to be successful at growing their market share.” IHS Automotive also recognized brands for most improved loyalty (Maserati); and two awards recognizing conquest in the auto industry – the highest percentage of conquest registrations (Maserati) and most improved conquest percentage of registrations (Lexus). IHS Automotive also feature three ethnic loyalty categories. Ford ranked the highest among African American consumers, while
Toyota was the highest for Asian and Hispanic consumers. In addition, 25 segment-level loyalty winners were announced, many of which are repeat winners from previous years. Interestingly, Ford had no winner in any individual segment, although the Lincoln MKZ won for Luxury Traditional Compact Car. Chevrolet had the most segment winners with three. Loyalty is determined when a household that owns a new vehicle returns to market and purchases or leases another new vehicle of the same make, model or manufacturer. The IHS Automotive Loyalty Awards are presented annually to OEMs and brands that demonstrate a manufacturer’s ability to retain owners over repeat buying cycles. This year’s awards are based on an analysis of nearly 16.5 million new vehicle registrations during the 2014 model year, which ran from Oct. 1, 2013 through Sept. 30, 2014. “We are pleased to recognize those OEMs that have put a concerted effort in maximizing customer loyalty,” said Michael Gingell, vice president, global market analysis solutions and corporate development, IHS Automotive. “Going forward, successful OEMs will excel at keeping their customer base through a greater understanding of their customers’ experiences – as well as the impact these experiences have on the consumers’ next vehicle purchase decision.”
Savvy Operator Owns ‘Rams’ URL
RAPID CITY, S.D. (AP) – The NFL has announced the St. Louis Rams’ pending move back to Los Angeles, but the domain name that carries the team name for the Rams’ former and future home base resides in South Dakota’s Black Hills. Rapid City used car salesman Brian Busch told the local newspaper that he bought the www.losangelesrams. com domain name in 1997, two years
after the team packed up and moved to St. Louis. He grew up rooting for the Rams, and thought he might build a fan site, but never did. The domain name, which is structured like some domain names for other NFL teams, has suddenly become more valuable with the league’s owners voting to allow the Rams to relocate to suburban Los Angeles.
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8 • February 1, 2016
USED CAR NEWS
DEALER LIFE DEALER SACRIFICES BUSINESS WHILE TRYING TO SAVE SON By Jeffrey Bellant
Stephen Cavasini spent more than two decades in the used-car industry and had to walk away when his son got sick. Now his family is hoping the industry will come to the aid of his son who has a rare mitochondrial disease that affects white blood cells and causes other health problems. “I was a car dealer for 25 years in Del Ray Beach, Fla.,” said Cavasini. “I started my own buyhere, pay-here business in January 1989. We were very successful.” In 2009, Cavasini, his wife Linda and son Zack welcomed the birth of Luke. Within months, however, Luke became sick. His health issues came during the middle of the recession, which hammered the country and the Cavasinis’ dealership, Dixie Motor Sales. The family struggled a few years, trying to navigate the recession with the dealership and the medical issues. Cavasini said Luke was six months old when he got the flu and was examined by a doctor, who “didn’t like what he saw in his blood.” That led to a long trail for
Luke and his family just to determine what exactly was wrong. Originally, doctors thought Luke had leukemia, Cavasini said, but he tested negative. Doctors sent the case to the Children’s Hospital at University of Miami. Over the course of two years, Luke received weekly blood transfusions in Miami and at St. Mary’s Hospital in West Palm Beach “to keep him alive,” Cavasini said From blood transfusions to spinal taps, it was an ordeal for the whole family. It became impossible to maintain the dealership. “The business was very capital-intensive,” Cavasini said. “We’re in a community of about 50,000 and we were a family business. People knew us and we had an excellent reputation. “We worked with people through the recession. Rather than get rough and repossess cars, we kept people in the cars and worked it out. But that impacted our cash flow in a negative way.” They just couldn’t continue. “So we ended up having to sell the property and getting what cash we could out of it,” Cavasini said.
In 2010, Luke was diagnosed with Pearson’s Syndrome, a condition that affects about 100 people worldwide, Cavasini said. “It’s kind of scary,” he said. “Many of these kids don’t live past age two. The ones that do live, degenerate throughout their later teens and into their 20s.” Cavasini said it impacts different organs, requiring
Luke to see specialists for each organ. The family was looking for alternative treatments when it learned about hyperbaric oxygen therapy, which traditionally has been used to help divers decompress. Cavasini and his wife, Linda, decided to try it and Luke responded well. His doctors had been skeptical beforehand, but are now on board with the treatment, Cavasini said. As things improved, Luke has been weaned down from once-a-day oxygen sessions to once a week and, now, to twice a month. “Since we’ve done the oxygen, he hasn’t had a blood transfusion, so it’s kept him alive,” Cavasini said. During the sessions, Luke lays on a gurney and is wheeled into a clear plastic cylinder that covers the gurney. He’s able to watch TV and use a phone, though he has to lay down, Cavasini said. Unfortunately, it’s an “outside the box” treatment, so the family has to
pay for it themselves. “It’s about $210 to $250 per session,” Cavasini said. “It kind of blows my mind that insurance would rather pay $20,000 for an inhospital blood transfusion than the oxygen treatment.” While treatment has helped, Luke, now 7, still remains undersized for his age. “He’s about 37 or 38 pounds,” Cavasini said. “He’s only grown one pound and one inch over the last year-and-a-half. “Last May, we started with growth hormone therapy. We’ve tried to get insurance to cover it, but that hasn’t happened yet.” The treatment helped him add another pound. But the medical expenses have been difficult. The family started a GoFundMe campaign, something Cavasini was at first reluctant about. He didn’t want to ask others for money, but he’s since agreed. Those interested in supporting Luke can go to the GoFundMe site and search for “All in for Luke.”
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10 • February 1, 2016
USED CAR NEWS
Analyst Sees Driverless EVs By Jenny King
DETROIT - Outspoken Morgan Stanley analyst Adam Jonas told attendees at a recent event that he did not visit the 2016 North American International Auto Show because it would be “a waste of my time.” Jonas focuses instead on shared, autonomous vehicles. On-demand “public” transportation is the future, he said. The more the human driver is no longer needed, the more vehicles should be shared, Jonas said. The Morgan Stanley executive also remains bullish on electric vehicles.
The “go-to strategy” for automakers must be miles, not units, Jonas said. With autonomous vehicles, the role of the dealer will be service. Jonas also predicted a downturn in the financial services community, describing the auto credit bubble as “huge.” He called the idea that automotive credit is here forever “ludicrous.” Jonas gave Ford and supplier Borg-Warner a “sell” rating, FCA and GM a non-committal “restricted.” He rated supplier Magna, AutoNation and Tesla as “buys,” and gave an “equal weight” to Hyundai and Volkswagen.
AG Sues for Missing Titles
An Arkansas used-car dealer faces and failed to deliver the vehicle title a lawsuit from the state’s attorney in a timely fashion. general for failing to provide vehicle The attorney general claims the titles. owners of Miracle Motors implicitly The Arkansas attorney general misrepresented the current condisaid the dealer failed to provide ve- tion of the vehicles they sold by ofhicle titles at the time of sale in 15 fering them for sale without having instances. the ability to convey the title at the According to the complaint, time of purchase. Jacksonville-based Miracle Motors The attorney general is asking the Corp. advertised vehicles for sale court to impose civil penalties, reson numerous occasions which it did titution for the affected consumers, 2015_SDA_Used_Car_News.pdf 10/9/15 2:39:47 fees, PM not own, sold the vehicles to Arkanattorneys’ costs and other resas consumers, accepted payment lief against Miracle Motors.
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12 • February 1, 2016
USED CAR NEWS
Shoppers Want Reliable Cars For the first time in nearly a decade, concerns about reliability have increased as a reason shoppers avoid certain models, according to the J.D. Power 2016 U.S. Auto Avoider Study. The study, now in its 13th year, examines the reasons consumers purchase, reject and avoid models in the marketplace when shopping for a new vehicle. The 2016 study measures shopping behavior among new-vehicle buyers who purchased during 2015. Vehicle reliability has become a top consideration in deciding which vehicle to buy. This year, 55 percent of new-vehicle buyers cite reliability as a leading purchase reason – the thirdmost frequently cited reason after exterior and interior styling – vs. 51 percent in the 2015 study. As recently as 2013, vehicle reliability was mentioned by just 48 percent of new-vehicle buyers as a reason for purchasing. Reliability has also become a greater reason shoppers do not consider – or avoid – other models (17 percent in 2016 vs. 14 percent last year). “Though vehicle reliability and durability have improved significantly over the years, they remain a vital consideration for consumers,”
said Dave Sargent, J.D. Power’s vice president of quality practice. “With so many auto recalls in the news and challenges with the introduction of new technology, consumers are even more attuned to the expected reliability of new vehicles. This impacts which models consumers avoid and which ones they ultimately purchase. “Bad news can tarnish an automaker’s reputation in an instant, yet, can take years to build back up. Automakers need to convince consumers of the true reliability of their vehicles so it is not a reason to avoid selecting a particular model.” According to Sargent, “concerns with vehicle reliability can also have a ripple effect on other aspects of vehicle consideration and ownership.” Study findings show that buyers who avoid models for reliability reasons tend to also have concerns regarding resale value, cost of maintenance and even safety. As gas prices remain low, fuel economy has become a less frequently cited reason consumers select their new vehicle (51 percent vs. 55 percent last year). In fact, gas mileage has reached a five-year low as a reason to purchase a specific model. It is also cited less frequently as a reason to reject other models that were considered.
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USED CAR NEWS
February 1, 2016 • 13
RETAIL MARKETS COLORADO
Peppe DeMarco, owner, Highline Motors, Fort Collins, Colo.: “We’ve been in business 20 years. “We keep about 35 cars on the lot. It’s the same as this time last year. “We sell 25 vehicles a month, on average. “It’s starting out very slow (in January). It’s been very cold and a lot of snow. “We get our inventory from a lot of dealers, auctions and private consignment. “We do straight retail. “I would have to say the average price on the lot is between $25,000 and $28,000. “Average mileage is probably about 25,000 to 30,000 miles. “I think the oldest vehicle we have on the lot is 2002, but most of our (inventory) is late-model stuff. “We sell more sport utility vehicles than cars or trucks. “We only sell maybe 2 to 3 percent domestics.
“We have mostly all imports. “I recondition our cars from A to Z. We have our own reconditioning department and our own service department. We also do the detail. “We go through the whole car. “Actually, we do much better than what’s done with certified cars, if you can believe that. “The average cost of reconditioning is $1,700. “(For advertising) we have a website. That’s it. Just the website and word-ofmouth. “We do a great job selling Lexuses, Acuras, BMWs and Mercedes. “It’s constantly getting tougher to get good inventory. “We recently sold a 2011 Audi R8 convertible, V10. It had 26,000 miles. “We got about $100,000 for the car. “We’ve just started the year, but I think for us it will be another great year.”
Tony LoBretto, owner, Alamo Valley Auto Sales, Kalamazoo, Mich. “I’ve been in business 18 years. Typically, I keep about 25 vehicles on my lot. But right now, I’ve got about 45. That’s hoping that the tax season is good. “Last season I didn’t have a good tax season, but I didn’t have the right product at the right time. This year, I’ve built up my inventory so I’m ready. I just hope it works out. “Most of my inventory comes from the auctions. “Last year was not a good year. I only sold about four a month. I think it’s just how the economy has been for the lower-dollar (customer). I sell mostly stuff that’s under $4,000. “People who used to come in here with $3,000 are now coming in here with about $1,200. I can’t help them because I don’t do any financing at all. “The average retail price is probably around $2,995.
Compiled by Jeffrey Bellant “The issue is that my customer is spending their last dollar. So they want a perfect car with no issues. That means every car I buy in that price range I have to put $500 or $600 into it to make it saleable. “There are plenty of vehicles out there but they just all need more work. In the price range I deal with, I buy a car at the sale. The customer that traded in that car did it because the car may have needed new brakes and new tires or had a cracked windshield and a (bad) exhaust. “So rather than fix that stuff, they traded it in. They drive them until they need more work. “But I have to fix them to sell them. “I would say my average reconditioning is $500 or $600. It was probably less than that – maybe between $300 and $400 – this time last year. The cost of everything has gone up. Tires cost twice as much as they did five years ago, batteries are
also almost twice what they were five years ago. “We do some of the (repairs) but send most of the stuff out. “My average model year is about 2002. “Most of my (vehicles) have from 140,000 miles up to 200,000. Mileage is similar to last year. “I sell more cars than trucks just because of the price. “The majority of my inventory is domestic. I can’t afford the Hondas and Toyotas. We have a couple of Kias and Hyundais, but even those are getting more expensive because they’ve turned out to be better than people thought. “I do very little advertising and I think that’s half of what’s hurt me. We do some Craigslist now and I have a website. With tax season, we’re definitely going to do more advertising. “The last one I sold was a 2004 Chevy Trailblazer. It had 155,000 miles. We sold it for $4,700.”
1/25/16 5:29 PM
14 • February 1, 2016
WHOLESALE MARKETS NEBRASKA
Ryan Durst, vice president, Lincoln Auto Auction, Waverly, Neb.: “This will be our 24th year in business. We’ve got four lanes and we’re running four lanes. “We’re going into tax time, so February and March are usually our strong months. “Our volumes are in the 275 to 325 range every week. We’ve been really consistent as far as that goes. “During tax time, you can’t get enough consignment, because you’re selling such a high percentage. “Our worst sale in January (though Jan. 21) was 70 percent. We’ll run those numbers all year. Our average last year was right at 70 percent all year. “During tax season, we’ll sell 80 to 85 percent, which is incredible. “We’re drawing between 190 and 225 dealers in the lanes. It’s similar to this time last year. “We’re getting (comments from dealers) that run the
gamut. We have guys that are just killing it. Our big Chevy-Subaru store had a record year in 2014 and they’ve been in business for 80 years. “Then some of our smaller independents are crying. It goes both ways. “We also sell cars over Auction Pipeline. I think it’s grown our business a lot. In these days you just have to have simulcast sales. We have 40 to 50 guys online every week. When we started, it would be four or five. It’s opened people’s eyes that you can buy a car online and get good product. “Our volumes are about 90 percent dealer consignment and 10 percent repossession/fleet. “Our repo-fleet is from banks and credit unions in Nebraska, Iowa and even into Kansas. We have a GSA sale that gets busy in March and April and goes strong until November and December. During that time, we’ll run a sale every four or five weeks. Those vehicles
include everything: passenger vans, cargo vans, sedans, sport utilities, utility bodies, etc. We’ll run between 100 and 125 of those. “Average price coming through the lanes is $4,310 and some change. “Outside of cheap stuff, nothing is struggling, Last I heard, steel was at 30 bucks a ton. Salvage guys don’t even come to the sale anymore. “In 2015, it was our best year ever across the board. We’re a little ahead of that now, but it’s only January.”
Kip Jarrell, general manager, Clarksville Auto Auction, Clarksville, Tenn.: “This is our 30th year. We’ll be having an anniversary sale in September. “We have three lanes and I’m only using two. We’re running an average of 150. It’s a little bit better this year. “On average, our sales per-
centages are 55 to 60 percent. That’s a little bit better than this time last year. “We’ve got older, notetype stuff all the way up to late-model lease-type cars. So we’ve got a little bit of everything. “With our lease and repos, we sell 99 percent every week. The regular consignment sells between 35 to 45 percent. “Almost half of our volume is (commercial) consignment. I’ve had Wheels and ARI as consignors for about 25 years. “We’re known for our lease stuff, even though we’re an independent, smaller auction. Those cars bring big money here. “But my dealers buying them are mom-and-pop dealers are not buying 20 or 30 cars, but can only afford to buy two or three. But these cars sell themselves. I’m trying to get other (consigners) here, too. “We’re drawing 80 to 100 dealers in the lanes. We’re getting a few more here.
USED CAR NEWS
Compiled by Jeffrey Bellant “People aren’t as interested in certain note-type cars, the $1,500 to $2,000 cars, like they used to be. Those cars used to bring more money in December and January. But most of those cars now have 250,000 miles on them. “I think it started to change with Cash for Clunkers. It just made used cars scarcer. Dealers who used to have 50 cars on their lots now have 20. “The average price is $7,000 to $9,000 (on the block). “Any kind of truck and work-type vehicle are the strongest. Cargo vans used to be plentiful, but (not as much now). Some of those will bring $3,000 or $4,000 more than the lease company is asking for them. “Some lease type stuff with a big book, like Subaru, aren’t doing as well. The Volkswagens aren’t doing well because of the recalls. “The weather’s been kind of bad. We’re not used to snow in Tennessee.”
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1/25/16 2:08 PM
TRUE COST OF INCENTIVES (TCI) December-14 Compact Car TCI $1,844 1 $12,950 2 $11,467 3 $10,347 4 $8,602 5 $7,124 Subcompact Car TCI $1,123 1 $11,778 2 $10,825 3 $9,741 4 $7,482 5 $6,384 Midsize Car TCI $2,445 1 $15,162 2 $13,267 3 $11,554 4 $9,806 5 $8,672 Large Car TCI $4,120 1 $17,184 2 $15,085 3 $13,610 4 $10,774 5 $9,171 Compact Crossover SUV TCI $1,574 1 $17,851 2 $15,585 3 $13,662 4 $11,717 5 $9,985 Midsize Crossover SUV TCI $2,797 1 $20,546 2 $18,946 3 $15,826 4 $12,950 5 $11,314 Midsize Traditional SUV TCI $1,660 1 $24,618 2 $22,339 3 $20,227 4 $16,512 5 $13,452 Large Crossover SUV TCI $4,134 1 $24,487 2 $21,034 3 $18,557 4 $14,629 5 $12,099 15_UCN.indd 1
December-15 % Change ‘14-’15 $2,013 $11,854 $10,988 $9,486 $8,019 $6,755
9.16% -8.46% -4.18% -8.32% -6.78% -5.18%
$1,425 26.89% $10,281 -12.71% $9,634 -11.00% $8,629 -11.42% $7,139 -4.58% $5,783 -9.41% $2,804 14.68% $14,191 -6.40% $12,880 -2.92% $10,855 -6.05% $8,818 -10.08% $7,786 -10.22% $3,502 -15.00% $19,652 14.36% $16,361 8.46% $12,987 -4.58% $11,205 4.00% $8,916 -2.78% $1,751 $17,165 $15,717 $13,578 $11,112 $9,765
11.25% -3.84% 0.85% -0.61% -5.16% -2.20%
$2,208 -21.06% $19,848 -3.40% $19,248 1.59% $15,616 -1.33% $13,141 1.47% $10,812 -4.44% $1,940 $25,643 $22,802 $20,340 $18,298 $15,412
16.87% 4.16% 2.07% 0.56% 10.82% 14.57%
$3,068 -25.79% $25,193 2.88% $22,082 4.98% $18,405 -0.82% $15,357 4.98% $11,889 -1.74%
December-14 Large Traditional Suv TCI $2,795 1 $32,539 2 $28,446 3 $25,350 4 $21,864 5 $17,305 Compact Truck TCI $687 1 $20,927 2 $19,064 3 $16,322 4 $14,423 5 $12,722 Large Truck TCI $4,158 1 $26,820 2 $24,746 3 $21,488 4 $18,552 5 $16,455 Minivan TCI $2,138 1 $20,305 2 $19,220 3 $16,298 4 $12,037 5 $9,787 Van TCI $1,894 1 $18,904 2 $16,992 3 $14,053 4 $11,141 5 $10,096 Entry Sport Car TCI $1,617 1 $19,581 2 $18,423 3 $17,839 4 $15,777 5 $12,426 Midrange Sport Car TCI $1,524 1 $39,786 2 $32,358 3 $31,590 4 $26,476 5 $22,985 Premium Sport Car TCI $2,381 1 $72,752 2 $58,212 3 $62,418 4 $46,945 5 $39,263
December-15 % Change ‘14-’15 $2,160 -22.72% $32,311 -0.70% $30,329 6.62% $27,034 6.64% $23,341 6.76% $19,811 14.48% $678 $21,409 $20,152 $17,974 $14,799 $13,270
-1.31% 2.30% 5.71% 10.12% 2.61% 4.31%
$3,949 $28,376 $24,442 $22,692 $19,264 $16,377
-5.03% 5.80% -1.23% 5.60% 3.84% -0.47%
$2,903 $19,102 $18,860 $16,016 $13,469 $9,272
35.78% -5.92% -1.87% -1.73% 11.90% -5.26%
$2,494 31.68% $19,400 2.62% $16,377 -3.62% $14,303 1.78% $12,469 11.92% $8,699 -13.84% $1,465 $20,545 $17,308 $16,155 $14,369 $13,809
-9.40% 4.92% -6.05% -9.44% -8.92% 11.13%
$1,389 -8.86% $42,357 6.46% $31,501 -2.65% $27,664 -12.43% $27,279 3.03% $22,304 -2.96% $2,742 15.16% $72,000 -1.03% $58,235 0.04% $50,796 -18.62% $49,748 5.97% $40,541 3.25%
December-14 Entry Luxury Car TCI $2,947 1 $25,012 2 $21,272 3 $20,031 4 $15,689 5 $13,271 Entry Luxury SUV TCI $2,181 1 $29,651 2 $25,890 3 $22,573 4 $18,866 5 $15,351 Midrange Luxury Car TCI $4,045 1 $35,681 2 $31,635 3 $27,337 4 $20,161 5 $15,731 Midrange Luxury SUV TCI $1,428 1 $41,602 2 $35,701 3 $29,466 4 $23,972 5 $19,921 Premium Luxury Car TCI $4,157 1 $58,507 2 $45,464 3 $39,874 4 $34,232 5 $26,084 Premium Luxury SUV TCI $2,554 1 $51,777 2 $44,083 3 $37,346 4 $27,452 5 $25,878
December-15 % Change ‘14-’15 $3,666 24.40% $25,468 1.82% $20,413 -4.04% $17,467 -12.80% $15,306 -2.44% $12,857 -3.12% $1,940 -11.05% $29,260 -1.32% $25,470 -1.62% $21,598 -4.32% $18,690 -0.93% $15,931 3.78% $4,156 $35,147 $28,518 $25,554 $21,444 $15,724
2.74% -1.50% -9.85% -6.52% 6.36% -0.04%
$1,661 $41,222 $34,382 $29,369 $23,248 $19,641
16.32% -0.91% -3.69% -0.33% -3.02% -1.41%
$3,261 -21.55% $58,154 -0.60% $45,007 -1.01% $37,141 -6.85% $31,667 -7.49% $26,867 3.00% $2,370 $57,604 $47,495 $38,086 $31,301 $24,474
-7.20% 11.25% 7.74% 1.98% 14.02% -5.43%
Edmunds.com’s monthly True Cost of Incentives (TCI) report takes into account all of the manufacturers’ various United States incentives programs, including subvented interest rates and lease programs as well as cash rebates to consumers and dealers. To ensure the greatest possible accuracy, Edmunds.com bases its calculations on sales volume, including the mix of vehicle makes and models for each month, as well as on the proportion of vehicles for which each type of incentive was used. TCI data (and other Edmunds.com data products) can be viewed industrywide, import vs. domestic, by country of origin, by make, by model and by segment. True Market Value (TMV) is the transaction price for vehicles. 1/22/16 2:26 PM
16 • February 1, 2016
DISCONNECTED JOTTINGS FROM I last wrote about car styles and then the North American International Auto Show opened in Detroit.
firmly establishes the marque, some more pleasingly than others. The Lexus range has the appearance of a samurai warrior’s mask
• 40-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
It seems we’re on the verge of some design shifts; the cabs appear to be set back with high waist lines and shallow glass areas. Larger wheels give the designs some real heft – the new Genesis G90 for ’17 epitomizes the theme. I remember that’s what put the Mustang ahead in 1964. Audi goes even further with a great gaping maw of a radiator grill and even slimmer glass. Front-end styling now
and helmet, but who lost his bottom set of dentures. See the new LC500 Coupe and you’ll know what I mean. The Mini isn’t a Mini any more – bent and stretched every which way and ends up looking like variations on the theme of a roller skate. The news that Bentley was bringing out an SUV brought mixed feelings but Porsche have made it work tremendously well with the Cayenne. So the initial reactions of “Really” and “Are you seri-
ous?” were tempered to just hoping they would retain some of the design elements that have always set them aside. I think they’ve done a remarkable job – football players and their wives will be charmed. The Bentayga (named after a small mountain on the Spanish Canary Islands), has that nose-inthe-air haughtiness with the swagger of the wide-hipped rear end of the Continental. Talking of Continental, Lincoln has simply lost its way. The new one looks as modern as a 10-yearold Audi. This is one of the marques whose front-end styling has changed so often, it’s hard to know who made it until you look at the badge. Sad, very sad. Even Chevy has done better than that with the new Malibu. Maybe they don’t have committees anymore trying to design horses and ending up with camels. Their marketing campaigns are appealing too with customer panels opining on
C R O S S WO R D
1. New electric model from Hyundai 4. New SUV from Jaguar 7. The whole shebang 9. Reduce the headlight glare 10. Odyssey or Passport 11. Amigo maker 13. Lexus __ F 14. You can’t run this light 15. Kelly Blue book datum 16. Christopher of “Superman” 18. Lotus sports car 20. No longer racing, abbr. 24. Saturn roadster 25. Mechanic’s container 28. U.S. newcomer’s course, for short 30. Unit of electrical resistance
33. Blue shade 34. Vail or Aspen activity 35. __ address 36. Prius and Corolla 38. Suspension components 41. Unaccompanied 43. French for gold 44. GMC crossover 45. Chevy model named after a beachfront city 47. Athlete’s wear, informally 49. Tubes in the engine 50. New Nissan truck with a Cummins Diesel engine
Down 1. The owners of Jaguar are based here 2. They are almost always on a
the ‘unbelievable’ quality achieved at a reasonable price – the proof of the pudding and so on. Mind you, remember when Malibu was one of the fleet market mainstays? I see a nice fit here. And potentially great fodder for the used-car market. With Land Rovers, the Discovery Sport and Evoque models look like a slab of concrete has landed on the rear end. Italian designs, especially of the luxury sports cars, always please with sexy swooping lines. The new Alfa Romeo fits the bill for its re-entry to the U.S. market. Let’s hope the bits and pieces last a while longer than the design. I love the Maserati Range, especially the sound. Remember when they used to name their cars after winds?
Khamsin, Ghibli and Mistral come to mind. Quatroporte sounds like a form of pasta until you figure out it means Four Door. Imagine calling a Chevrolet “Four Door”, too pedestrian to cause a rush to the showroom door. The really cool designs are now vested in trucks and performance to go with them. If your plumber owns an F150 he can now actually arrive on time. Truck interiors are as posh and as efficient as any CEO’s office with access to even more technology than most owners will probably ever use. I love this business, even standing on the sidelines these days and marveling at the creativity in the industry. Mind you, one of the best design logos is for the auto show itself.
To see past columns from Tony Moorby, visit www.usedcarnews.com/columnists/tony-moorby Digital version available at usedcarnews.com
By Miles Mellor
USED CAR NEWS
license plate 3. Infiniti CUV 4. Part of a cooling system 5. Police blotter abbr. 6. Lotus sports-car model 7. RDX maker 8. Noisy 12. Path to enlightenment 17. Land Rover Range Rover ____ 19. Zodiac sign 21. Supplement, with “out” 22. Mitsubishi model 23. Audi A3 _____ E-Tron 26. Big name in crude oil 27. Marks 29. Comical theater piece 31. Luxury car brand of Mercedes Benz 32. Gives a thorough cleaning and polish 33. Besides
37. Menu phrase 39. Investor’s expectation 40. From the city 42. Give off, as light 46. Auction buy 47. 50 states 48. License is often used as one
Solution to the 1/18/16 puzzle 1
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USED CAR NEWS
February 1, 2016 • 17 Advertisers are solely responsible for content of classified advertisements. To place an ad, or for more information, call the Classified Department: 800-794-0760 ext.107
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CLASSIFIEDS 1/22/16 2:53 PM
18 • February 1, 2016
USED CAR NEWS
AROUND THE BLOCK REMARKETER HONORS AUCTIONEER
BEST ON THE BLOCK: ARI’s Jim Jackson (left) traveled to Brasher’s Northwest Auto Auction to present ARI’s Auctioneer of Distinction Award to Dean Fumasi.
Auctioneer Dean Fumasi has run everything from commercial livestock to used vehicles. Now, after spending the last 30 years with the Brasher’s auction family, he has been awarded the ARI Auctioneer of Distinction award for “his dedication to ARI and the dealers in the auction lane,” at Brash-
er’s Northwest Auto Auction. He becomes one of only six auctioneers to have received the award since its inception in 2011. “Dean constantly promotes ARI and our online capabilities to provide quick answers to dealers, keeps them engaged during the sale, and truly drives the vehicle’s
Used Car Manager McCurley Integrity Dealerships Pasco, WA • With McCurley 16 years
value in the auction lane,” said Bob Graham, vice president of vehicle remarketing at ARI. “We have noticed Dean’s exceptional auctioneering skills for quite some time, and we believe he is truly deserving of this honor.” ARI Vehicle Remarketing Supervisor Jim Jackson traveled to Brasher’s Northwest Auto Auction in Eugene, Ore., to present the award to Fumasi in the ARI auction lane. Buyers, auction staff and associated sellers cheered and applauded Fumasi’s achievement. Fumasi’s auction career began with auctioneering commercial livestock in 1981. Since then his experience on the block encompasses automobiles to commercial and purebred livestock, estate, farm, specialty and black tie charity events. He joined the Brasher’s family of auctions three decades ago, serving in the Sacramento, Northwest and Portland locations.
Compiled by Jeffrey Bellant
Fleet Firm Names Award Winners Manheim Kansas City took home the top award from Element Fleet Management. The Gold Award honors the auction with the best overall performance in all criteria. Other national winners included: DAA Northwest, Manheim Seattle, Above and Manheim Utah. Silver Award winners included: America’s Harrisburg, Manheim Central Florida, ADESA Minneapolis, and Manheim Phoenix. Regional winners for Outstanding Promotional event were: DAA Huntsville, Manheim Milwaukee, and Manheim Riverside. National Internet and Technology winners by region included: Manheim Pennsylvania, ABC St. Louis, and Manheim Nevada. Amy Taitano, of Manheim Pennsylvania, won the Laurie Dobberphul Award for Outstanding Female Performer for GE Accounts.
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: firstname.lastname@example.org
Director of Dealer Sales, Northwest Division – McConkey Auction Group Spokane, WA • With DAA Northwest 19 years
• Steve Doyle’s customer since 2000 • “DAA Northwest feels like home. The service is incredible and everyone here gives it their all to get my cars sold.”
• Ken Shoemake’s account representative for 16 years • “All of us at DAA Northwest are committed to taking care of our customers, and we have the flexibility to do so.”
“This Is My Auction.” PO Box 19190 | Spokane, WA 99219 | McConkeyAuctions.com
1/25/16 2:35 PM
USED CAR NEWS
February 1, 2016 • 19
Special Advertising Section IAG_UCNhalf-2016 CAMPAIGN.pdf
Autotrader.com .......................................................... 24 Car Financial Services ............................................ 30 Credit Acceptance Corp. ................................ 28 & 30 Gordon Howard/Passtime .............................. 22 & 23
GWC Warranty .......................................................... 20
Independent Auction Group’s member auctions offer simulcasted auction sales and a variety of national online sale platforms to meet every seller and dealer need.
iMetrik Global .................................................. 24 & 25
Northland .......................................................... 19 & 30 Skypatrol LLC .................................................... 21 & 26 Spireon .............................................................. 28 & 29 Vehicle Acceptance ................................................. 19
Floorplan Dealer Portals By Jonathan Neubauer, President & CEO, Vehicle Acceptance Corporation
Technology is improving for dealers at breakneck speed. The ability to obtain real-time valuations on vehicles while standing in the lane at the auction, view credit availability on your phone, and process payments and transactions from anywhere didn’t exist a few years ago, but are now mainstream. Vehicle Acceptance has spent a great deal of effort building what dealers actually want: something that is easy to use, works on their phone, and is fast with real-time data.
VAC is constantly improving their dealer portal based on input from dealers; if you want a feature, they can build it quickly. Floorplans Simplified is what VAC is all about, and that means a constantly improving dealer portal that is easy to use. Vehicle Acceptance is here to provide the best service and technology dealers deserve. If you are a dealer looking for a familyowned floorplan company in business for 26 years with a sincere commitment to help you succeed, contact VAC today. Learn more at VACorp.com/SignUp or call 1-888-571-7092 for more information.
We Bring the Technology
1/25/16 2:13 PM
20 • February 1, 2016
Special Advertising Section
Exclusive Tech Benefits Help Elite Dealers Sell More Cars For used car dealers, it’s a constant struggle to compete with larger competition on a smaller budget. That’s why it’s imperative these days to implement tools and strategies into your dealership that give customers the confidence that comes with buying a car from a big-box store – without the price tag. Because of this, GWC Warranty recently introduced two new technology tools to help dealers level the playing field with larger competition. As part of GWC’s Elite Dealer Program, GWC’s top dealers have exclusive access to GWC Virtual Training and Covideo. GWC Virtual Training is an online, interactive training tool with content for every employee in a dealership. Training is a vital element in successful dealerships, but many smaller stores struggle to find the time or money to invest in it. That’s why GWC is offering Elite Dealers free access to content they can view whenever, wherever they want – with courses on topics ranging from
USED CAR NEWS
Credit Acceptance is Easier, Faster, and More Profitable
sales and service to compliance and vehicle service contract tips and best practices. Covideo lets dealers create, send and track video email marketing messages to drive traffic into their dealerships. Ideal for vehicle walk-arounds, internet lead nurturing, sales follow-ups and more, Covideo is proven to increase showroom shows by 27%, CSI by 10% and car sales by 7%. Also, exclusively for Elite Dealers, GWC will share the cost of Covideo, a benefit only available from GWC. True to our promise to dealers, GWC Warranty is helping dealers sell more cars by offering access to technology that allows them to be more efficient and progressive. GWC Virtual Training and Covideo are just two of the many technology tools and benefits that fulfill this promise. To learn about more, visit www.GWCWarranty.com.
Since 1972, Credit Acceptance has offered automobile dealers financing programs to help them sell vehicles to consumers, regardless of their credit history. These programs are offered through a nationwide network of automobile dealers who benefit from selling vehicles to consumers who otherwise could not obtain financing. Credit Acceptance is unique in that enrolled dealers using the portfolio program share in the cash flows from the contract, which creates an alignment of interests and is a critical element of its success. One misconception of the Credit Acceptance program is that it only works for older model vehicles. In fact, it works well with nearly any vehicle; many low-mileage, late-model vehicles (as new as 2015) yield the greatest advances. And, the Credit Approval Processing System (CAPS®) enables dealers to easily structure profitable deals with payments customers can afford. As Credit Acceptance reports to the three national credit reporting agencies, an added benefit of the program is that consumers can improve their credit with on-time payments and move on
to traditional financing sources. It is now easier, faster and more profitable than ever to do business with Credit Acceptance. A significant benefit is eContracting, which enables customers to sign contract documents electronically. This eliminates the need to send contract packages via courier, saving dealers money and considerably reducing funding times. Many deals are funded the same day. Additionally, CAPS® interfaces with multiple vendors (including Dealertrack®) to help dealers easily get applications and leads into the system without duplicate entry. Credit Acceptance has also made enhancements to approval stipulations to streamline the funding process. A proven leader, Credit Acceptance paid dealers over $2,065,409,992 in Advances and $202,678,019 in Portfolio Profit in 2015 alone. Visit CreditAcceptance.com to find out how you can sell more cars and make more money.
GWC WARRANTY HELPS TURN CAR SHOPPERS INTO CAR BUYERS. GWC Warranty helps dealers sell more cars by giving car shoppers the confidence to become car buyers. We offer our dealers and their customers a “No Worries, Just Drive” experience through outstanding service and expansive coverage options.
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1/25/16 2:07 PM
Donâ€™t Let Them Forget
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Best Vertical Platform M2M Evolution Conference Battle of the Patforms
1/21/16 3:41 PM
22 • February 1, 2016
USED CAR NEWS
Special Advertising Section
2G Sunset: It’s 2016 Already? a website). Like it or not, your GPS Communication PassTime device relies upon and is connected to various technologies, We blinked and 2015 was including cellular networks. over. As we get back into the swing of things and 2G Sunset Announcement gear up for 2016, we recall Back in 2012, AT&T anthat this year holds signifi- nounced that it would have cance for those using GPS its 2G network completely devices to manage inventory, shut down by the end of 2016. payment assurance and asset As wireless carriers conprotection. This is the year tinued to build networks to of the 2G Sunset for AT&T. support 4G/4G LTE and future technologies, 2G became more Technology Industry difficult to maintain. GPS devices used to track Throughout the past several assets for repossession and years, AT&T has systemically recovery most often use cel- taken down pockets of its lular technology. 2G network capability and It operates in a similar way “re-farmed” its towers for to a cell phone – communicat- 3G & 4G. That process will ing over a wireless network. be completed by the end of These GPS tracking devices this year. are considered “machine-toWhen AT&T announced its machine” (M2M) devices. plans to have its entire 2G You may also have heard a network shutdown by the end newer term called IoT, or the of 2016, it seemed like a long “Internet of Things” which way off. But here sits 2016 – is similar in nature. and the impact draws closer. Whether you call it M2M, IoT, or just a GPS Device, it What is the impact of this means that one machine (the AT&T 2G Sunset? GPS device) is communicatIf you are still using 2G ing with another machine devices, you may experi(computer servers hosting ence an impact. Depending By Jeff Karg
Director of Corporate
upon your device provider’s carrier relationships, your 2G device is likely on AT&T, T-Mobile, or an operator that has roaming agreements with one or both. Let’s be clear, T-Mobile is NOT shutting down its 2G network. In fact, late last year, T-Mobile announced that it will extend 2G coverage on its network through 2020. But, without AT&T to roam, T-Mobile devices will be restricted to their home network. If your 2G device is on T-Mobile directly, or has access to T-Mobile’s network through roaming, you’ll likely have some coverage in T-Mobile’s home area. But the question is: is that coverage cnough? Plan of Action While many GPS device providers stopped selling 2G devices quite a while ago, some continue selling. The most important step for any buy-here, pay-here dealer, finance company, credit union, etc. using devices is to KNOW what technology you’re buying. If you want to
keep using 2G devices, make sure you at least know you’re taking that risk. While there are many variables to consider, a few options available are: Safest: The safest option when it comes to 2G would be to completely discontinue purchasing or recycling any 2G devices on new loans and redemptions. Make an active effort to get 2G devices off all vehicles. This could be done by swapping out 2G devices on vehicles in for service or even offering specials on oil changes, etc. in order to bring vehicles in. Moderate: A moderate option available to you would be to stop purchasing or recycling 2G devices, opting instead to install 3G devices on new loans and any time a vehicle is reasonably accessible to swap out an old device. As opposed to making an active effort to get vehicles in to swap out
a device, this option would feature swapping devices out as vehicles come in. Riskiest: perhaps the riskiest of the three options would be to continue to purchase and recycle 2G devices, installing them on all of your vehicles/ loans, even multi-year loans. This would be done with the knowledge that AT&T’s 2G coverage will be completely shut down by the end of 2016. The coverage of these devices would largely be restricted to T-Mobile’s 2G home network coverage. PassTime, which has been in business for more than 23 years, understands that these changes in technology can and will affect customers across the country, and is committed to educating the industry about the 2G sunset. To learn more about the 2G sunset and PassTime’s solutions, contact us: 877-727-7846 passtimeusa.com
Single Software Platform an Affordable Reality A challenge many used car dealers face is keeping up with technology, more specifically software. It’s not just about having a computer and website anymore. Today, dealers have the ability to use a variety of different software solutions to optimize their business operation. How many different software programs does it take? Many dealers find themselves logging into separate software programs for inventory management, accessing credit reports, submitting deals for financing, finally desking the deal and printing paperwork. Technology is getting smarter though, and converging these capabilities into a single software platform is now an affordable reality – even for independent car dealers. Dealers can now benefit from using dealer management systems (DMS), customer relationship management (CRM) systems and a mobile application that work together to help dealers sell more cars, simplify operations and save valuable time and money. As mobile technology has become mainstream, the focus is on
enabling all of these same features to be accessible using a smartphone or tablet. Owners and managers who cannot spend all of their time physically at the dealership can use mobile technology to continue to run their business. From receiving leads realtime to managing inventory to closing a deal, it can all be done with mobile technology. Auction day is a critical activity that consumes a great deal of time. Mobile technology with VIN scanning can be used at the auction to buy smarter with easy access to book value services and vehicle history reports. This allows dealers to make informed decisions and avoid overpaying. As vehicles are acquired, mobile technology can be used to take photos and instantly add them to inventory and to the dealer’s website. The right software solution can be a game changer, allowing a dealer to take control of their business.
1/22/16 5:03 PM
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1/22/16 5:04 PM
24 • February 1, 2016
USED CAR NEWS
Special Advertising Section
Are all GPS devices really “State-of-the-Art”? The sale of pre-owned automotive assets is the epicenter of an industry that supports countless businesses. These include extended warranty insurance, aftermarket parts & servicing, detailing accessories, front and back-end lenders, floor planners, GPS providers, dealer management systems (DMS), among many others. Fierce competition between all of these product and service providers generates the opportunity for dealers to benefit from a wide range of suppliers and encourages them to make informed decisions. The supplier communities are under pressure to ensure product and service integrity, to deliver constant improvements and updates and to present their “wares” in the best possible manner. In particular, there is one group of service providers that subprime and buy-here, pay-here automotive dealers use on a daily basis to manage their assets, whose products fall into the “high
technology” category: GPS tracking devices. These M2M (machineto-machine) products are presented as a payment assurance solution, providing powerful and efficient tools to buy-here, pay-here and subprime car dealers and finance companies wishing to experience greater customer loan payment continuity and
towers to deliver the most efficient data transmission. There are a number of suppliers that specialize in this product category. Some are distributors who purchase low-end products from overseas and sell them in the US. Others, such as IMETRIK, have achieved major brand status by being the developers
ing the newest ideas and the most up-to-date features”. The phrase has been employed since 1910, and has now become such a commonly used term in advertising and marketing, that it can sound like an exaggeration or even a meaningless buzzword. To distinguish the real stateof-the-art tracking devices, such as IMETRIK’s 3.5G GPS
reduce repossessions with functionalities such as geolocation, payment reminder and starter interrupt. These GPS devices are not only trackers intended for vehicle recovery, they also have a host of significant and robust technological features that allow for responsible asset management. They are very complex hightech machines, communicating with satellites and cell
and manufacturers of their own superior hardware, software and powerful turnkey applications. These devices are truly state of the art. But wait! Everyone claims their devices to be “state of the art”! What does that even mean? According to the Oxford Dictionary, the term state of the art is defined as: “the most recent stage in the development of a product, incorporat-
Solutions that integrate the very latest in technology, from those with false claims, you simply need to ask your current GPS provider the following key questions: • Is the device engineered with only premium quality industrial-grade components for maximum reliability and performance? • Is it built with a silicon SIM chip which won’t melt, warp or otherwise get damaged
in the heat like a plastic SIM card, ensuring long term durability? • Does the device have specially designed circuitry that protects against power surges and minimizes power consumption from your asset’s battery? • Is the device configured for advanced GPS satellite triangulation, enabling precise geolocation to within 12 feet of your asset’s location? • Is the device built with a superior customdesigned antenna, specifically configured and calibrated for optimal GPS under-dash usage; an antenna so sensitive that it can pick up even weaker signals while filtering out static and interference? • Does the device support up to 10 real-time Geo-Fences? Ask your current GPS provider those questions, then call IMETRIK today to find out all you need to know about real state of the art GPS solutions. IMETRIK 1.866.276.5382
1/22/16 5:05 PM
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1/22/16 9:48 AM
26 • February 1, 2016
USED CAR NEWS
Special Advertising Section
All GPS Devices Are Not Created Equal
Advice for Buy-Here, PayHere Decision Makers: All GPS Devices Are Not Created Equal GPS systems that track, locate and help recover cars sold to sub-prime borrowers have become an important tool to help buy-here, pay-here dealers protect their assets and reduce losses. But don’t let your own everyday experience with the GPS technology in your cell phone or navigation system lead you to believe that vehicle tracking solutions are all the same with no meaningful differences. The truth is all GPS devices are not created equal. A Better Antenna for More Reliable Tracking Two main attributes determine a device’s ability to track vehicles: antenna design and
network coverage. Many GPS vendors cut corners in antenna selection, choosing generic off-the-shelf components to merely meet their carriers’ minimum standards. Skypatrol designs their own custom antenna that not only meets, but exceeds, the strict standards of their CDMA carrier, Verizon. For starters, the antenna in the Skypatrol SP3300C GPS device is physically larger than competitors’ models, enabling it to bring in weaker signals when a vehicle is in fringe areas. Plus, designers tuned the antenna to take maximum advantage of every tower within range. This creates more points of contact with the network and a stronger cellular connection with the vehicle. In actual head-to-head ef-
ficiency tests, the Skypatrol cellular antenna outperformed competitors’ models two-to-one. Superior Coverage on the Verizon CDMA Network As to network quality, Verizon – Skypatrol’s exclusive CDMA carrier – is unquestionably the best. This was confirmed by RootMetrics, the nation’s leading independent provider of mobile performance information, who rated Verizon number one in every aspect that matters in performance of a GPS tracking device: network reliability, network speed, data performance and – for the fourth consecutive time – overall performance. In its RootScore Report for the first half of 2015, RootMetrics called Verizon’s data reliability results “stellar” as the carrier surpassed RootMerics’ 97%
threshold of excellence for both making a connection and staying connected in each of the 125 metro areas tested. Verizon excelled at statelevel testing, too, winning or sharing the Overall RootScore Award in 47 of 50 states. By comparison, the nearest runnerup, AT&T, won or shared in 12 states. Sprint, the carrier of choice for one of Skypatrol’s competitors won or shared in zero states and was rated third out of four carriers nationwide. Customer Experience Proves the Value Why all of this matters is because Skypatrol’s features can mean the difference between finding a car, or not. That’s been the experience of Joe Kaminski, Owner of Joe-K Used Cars in St. Louis. “Over the years I’ve bought a lot of GPS devices, and I’ve seen a lot of them unable to locate after a few months,” he says. “Now, I’m putting a Skypatrol GPS on 99% of the cars I finance. “We’ve recovered vehicles stolen off our lot and our repo team is able to locate and recover cars quicker.”
Or consider Monica Borodi, Account Manager at Creel Motors, a three-location buyhere, pay-here dealership in St. Petersburg, Florida. In one instance, Skypatrol’s signal quality helped her assist local police in tracking and recovering a stolen car. “I spent about an hour on the phone with communications, giving them locations,” she recounted. “For an hour, I’m just pinging the GPS and getting solid hits one after another.” Another time, Borodi used Skypatrol to locate a car hidden in the garage beneath an apartment building in San Francisco. “If Skypatrol says it’s right there, then it’s right there.”
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1/22/16 1:18 PM
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1/22/16 9:48 AM
28 • February 1, 2016
USED CAR NEWS
Special Advertising Section
Four Easy Steps to New Revenue This Tax Season
Today’s dealers use GPS tracking to manage inventory and collateral. But what if you could bring down the costs of GPS tracking, or even make a profit from it? Now you can, with both Goldstar GPS and Kahu from Spireon. To add a new profit center for your dealership, follow these four easy steps.
Step 1: Partner with Spireon for your GPS tracking needs. GPS tracking has proven to reduce delinquencies and vehicle recovery times. As a result, dealers who use Goldstar GPS tracking have increased their ability to finance and serve more customers. Why choose Spireon? Here are several reasons: - Spireon is the leader in GPS tracking, with over 2.5 million active subscribers. - To ensure nationwide network coverage even in rural or remote areas, we partner with all major cell providers, including Verizon, Sprint and AT&T. - We help dealers reduce the risk and cost of subprime loans. - As the market leader, we
lead with innovative features Kahu is a service that enables such as automated reference your customers to recover checks and VIN scanning. their cars if stolen, pinpoint the location of their car 24/7, Step 2: Perform one-time receive alerts for speeding or installs on vehicles (or let unauthorized movement and us handle it). access a vehicle’s trip history, Spireon’s GoldStar GPS all from the Kahu app on their devices are easy to install with smartphone. minimal wiring and options Car tracking appeals to a wide for covert placement to avoid audience, from parents who device removal or tampering. need to track their teenage Don’t have the time or drivers or to buyers who just manpower to install yourself? want to keep their cars secure. We offer the industry’s only In fact, the connected car nationwide professional instal- market is expected to grow lation service network with into a $152 billion dollar market certified, trained technicians. by 2020, according to Business Our services are available within Insider. 24-48 hours at your dealership. A Wakefield study commisWe also provide a one-year sioned by Spireon also shows labor guarantee, with quality that dealerships are the ideal control audits and a full place to offer services like Kahu. equipment warranty. The study shows that nearly 70% of consumers prefer to have Step 3: Offer Kahu as an connected car features installed add-on service to your cus- by a dealership as opposed to tomers. installing the features on their GPS Services have become key own after car purchase. revenue generators at leading While there are other concar dealers around the country. nected car services, (some of You can offer next-generation, which require consumers to high-tech Connected Car apps install the GPS tracker into their to your customers by adding car themselves and manually Kahu at the point of sale. upload data to a computer) none
of those apps can compare to tools to protect their vehicles the type of nationwide cover- and their loved ones. age and reliability that Spireon Whilenoteveryonecanaffordan Kahu provides. expensive car with all the bells and whistles, Kahu lets your Step 4: Profit! customer turn their vehicle Here’s the best part – if you into a protected smart car. already partner with Spireon So, why look at GPS trackfor GPS tracking, offering Kahu ing as an expense when it can as an add-on service requires be a profit center? You earn no extra work on your part additional revenue and your except for offering it to your customers gain a connected customer. car experience. By selling Kahu, you profit For more information, call from add-on sales and also (888) 517-3630 or visit www. provide your customers with kahuapp.com/dealer.
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“I opened my business in 1998 with about 15 different lenders and selling around 30 cars a month. In 2004 most of the lenders dried up and so did my volume and cash flow. My first Portfolio Profit Express check was $47,000. Credit Acceptance not only saved my dealership, it’s allowed me to increase my sales. The program has been life-changing for me and my customers.”
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1/22/16 5:08 PM
YOU WOULDN’T DIVE INTO A TANK FULL OF HUNGRY SHARKS. SO, WHY RISK YOUR TAX SEASON PROFITS?
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1/22/16 4:55 PM
30 • February 1, 2016
Special Advertising Section
USED CAR NEWS
How Do You Make More Money and Give Up Less Control? looking for a
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The biggest fears a dealer has when contemplating the sale of receivables focus on pricing and loss of customer control. How can a dealer compare pricing among different companies to make sure that they are getting top dollar for their receivables? How can a dealer afford to give up control of the customer? With CAR Financial providing capital and cash flow solutions for your dealership, both of these questions are easily answered! CAR helps dealers where they need it and keeps the dealer involved in the portfolio so that the customer remains a dealership customer for life. Whether you are new to the buy-here, pay-here business or you are looking to expand your current buy-here, pay-here operations, CAR Financial Services can design a program to meet your needs. These programs include: • Bulk Purchasing of both retail or lease receivables • Purchasing of payment streams to meet short term cash needs • Servicing of portfolios for dealers and finance companies • Floor plans for the buy-here
Look Beyond Cost and Features GPS Tracking devices have become a standard addition to buy-here, pay-here, lease-to-own, and daily rental cars. With the market being flooded with GPS companies and different devices, it’s hard to choose which one to use! There are so many different sizes, mounting types, features, battery life, installation difficulty, reporting options, prices, etc. Choosing the right one can be overwhelming!
• Backup Servicer and Custodian for Banks and Finance Companies
It’s also important to remember that when it comes to technology, finding the lowest cost item doesn’t always deliver the results you want! We recommend you start by determining what the end purpose is for using a GPS device. For Lease’T’Own® dealers, the main purpose for using the GPS is to aid in the location of their property in case the customer defaults
pay-here industry, including a seamless floorplan to retail program and NO AUDIT FEES! CAR Financial has a proven track record of over 25 years in the auto finance industry and can help you by customizing a purchase/ service program that meets your needs, providing quality service through a single point of contact located near your dealership. CAR Financial strives to understand your day to day business so that they can structure a program designed to meet your long term goals and objectives. Whether purchasing a stream of payments, purchasing all or part of your accounts outright, or simply servicing your buy-here, pay-here portfolio, the trusted professionals at CAR Financial are interested in working with you to meet your dealership needs. CAR Financial operates in 45 States and is continually evolving its programs to meet the ever changing needs the buy-here, payhere market. Interested in more information on CAR Financial Services’ programs and services? Go to www.carfinancial.com or call 877-570-8857.
on payments or drops insurance coverage. Others may use it solely for leveraging on-time payments with the starter interrupt feature. Once you determine your purpose, it’s easier to weed out devices that don’t offer the features you need. Now that you’ve narrowed it down, the next step is to look beyond the basic features and investigate these two points through word of mouth recommendations from actual users: • Reliability of the GPS unit • The quality of tech support you’ll be receiving if something goes wrong. For example, Northland Auto Enterprises, founder of the original Lease’T’Own® program, is not only a distributor of PassTime GPS units, they use the PassTime GPS units on their own fleet of Lease’T’Own® cars. Northland is a great source for word of mouth recommendations on various GPS units they’ve used over the years. Northland can be contacted at 800-879-3433 or through their website at www.NorthlandDealers.com.
1/22/16 5:09 PM
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1/21/16 3:37 PM