reblog from http://vinadvisor.net

Auto Remarketing posted a very interesting article today about the how the wholesale vehicle market has changed in the digital age.

The accelerating shift of dealers to online auctions to buy retail and sell wholesale units is not surprising. Offering dealers small and large a simple way to spend less on staff and travel, find more vehicles closer to the dealership and be assured a fair price whether buying retail or selling wholesale units is a win, win proposition. Easy call, right?

So why then when you ask the same dealers about selling cars online do they instantly hold up a STOP sign? Reducing the time spent per sale, increasing the share of local sales and assuring consumers a fair price are (and have always been) the core drivers to improving service retention, repurchase loyalty and dealer reputation. Change is not easy, but resisting it is getting exponentially more expensive.

Here’s what Auto Remarketing had to say…

Soon, Doug Hadden says, the wholesale vehicle market will transition from the majority of cars being sold in the auction to most being sold online.

Hadden, who is the director of strategic dealer sales and services at ADESA, was speaking to dealers at a breakout session during the DealerSocket User Summit in early October.

It should be noted that Hadden believes there won?t ever be a time where there?s not physical auctions. However, online buying and selling in the wholesale market is ramping up.

It used to be that 10 percent of wholesale car sales were online, he said. Now, it?s between 20 percent and 30 percent.

And it ?won?t be long,? Hadden said, before that number is between 40 percent and 60 percent are online.

?The beauty of it is, it?s getting easier,? he said to the dealer attendees. ?But you have to quit fighting it.?

Those dealers that refuse to buy online are likely to be left behind, he said.

Hadden suggested that the best car a dealer can buy online is a low-mileage, off-lease car. And there could be plenty of options in that group next year: Hadden said there will likely be an estimated 4.3 million lease returns in 2017.

?And it?s not slowing down,? he said.

Nor are various providers in the online wholesale market. For instance, ACV Auctions ? a mobile platform that can enable dealers to view, bid and purchase inventory online from selling franchised dealers ? announced in late Septemberit had raised $5 million in venture funding, led by Tribeca Venture Partners, with participation from SoftBank Capital NY, Armory Square Ventures and Rand Capital.

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vinadvisor