Dealer auctions are an exclusive type of auction that is only open to people with a “dealer license”. This means people who are qualified to buy and sell a certain number of vehicles per year. These auctions often have an array of vehicles and bid prices to allow for secondhand market markup. In this article, I will discuss how dealer auctions work and share my experience with the dealer auctions near me.
Map of Car Dealer Auctions Near Me
If you are searching for “Dealer Auctions Near Me”, see locations below…
What is a Dealer Auction?
As the name suggests, a dealer auction is a vehicle auction only open to those who have a dealer license. If you don’t have a dealer’s license, you can apply for one, but there are different requirements in each state. See what your state requirements are here.
Vehicle dealer auctions are invaluable to source, for those working in the car industry. Dealers can choose from a wide variety of cars and other vehicles at a dealer auction. These events often offer significantly lower prices than the market value, so that a dealership can mark up. Some used car dealers, particularly the smaller ones, rely on these sorts of auctions to obtain stock for their lot.
How Do Dealer Auctions Near Me Work?
In certain ways, a dealer vehicle auction works exactly the same way to any other standard auction. Hundreds of thousands of vehicles from different sources are put up for auction by the auction house and sold to the highest bidder. Dealers inspect the vehicles before waiting for the auctioneer to move the vehicle into the auction lane so they can make a bid.
The one thing that makes a dealer vehicle different from a standard auto auction is that only those who can prove they work for a car dealership and have a license are able to attend. As a whole, they are closed to the general public, giving dealers the first choice.
Can The General Public Bid At A Dealer Auction?
It is easy to understand why purchasing from a dealer auction would appeal to many private buyers on the lookout for a new car. After all, who wouldn’t want the opportunity to buy decent vehicles at wholesale prices? However, accessing dealer auctions as a private person without a dealer’s license is typically very difficult.
Individuals who plan to attend dealer auctions on a regular basis and purchase several vehicles may find that obtaining a vehicle dealer’s license from the state government is the best option. Obtaining an auto dealer’s license may be a time-consuming, costly, and difficult operation, but it can be a viable choice for private buyers who want to continue buying and attending auto auctions.
Private buyers who only want to purchase one or two cars, on the other hand, are normally better served by partnering with a car auction broker. Auto auction brokers have dealer certificates that they buy to enable them to participate in dealer sales, and they also work with private buyers who want access to a broader range of affordable vehicles.
Auto dealers would have an easier time getting into dealership auctions if they had access to all of the necessary dealership certificates from their state government. If you are thinking about getting your car dealer’s license to gain access to dealership auctions, keep in mind that you will have to meet the same criteria as any other auto dealer.
You will need to contact auction companies directly to register for auction access once your dealership is approved. Most large dealer auctions now have websites where you can apply, but smaller local auctions may include a phone call or a simple paper application. Some companies like Copart feature inventory that are listed as “No Dealer License Required”.
Where Do the Vehicles Come From?
Auction houses pull their stock inventory of vehicles from a range of sources, including:
- Vehicles that have been repossessed by lenders – Vehicles may be repossessed by financial institutions for a variety of reasons, usually a failure to pay. Auctions are the most common method of reselling vehicles that have been repossessed, as the financial institution only aims to cover their losses rather than make a profit, meaning they often sell for low prices.
- Vehicles returned at the end of a lease period – At the end of a lease period, vehicles are returned to the financial institution. Dealer auctions are also the only way for certain financial firms to get rid of a significant number of end-of-lease returns. The terms of a lease usually limit the number of miles you can drive, require routine maintenance, and penalize you for unnecessary wear, meaning they are almost always in good condition
- Dealership trade-ins: Traded-in cars may have useful extras and sometimes even aftermarket modifications. The overall state of these vehicles is extremely variable. Some may be very old and no longer covered by the manufacturer’s warranty.
Other methods of financing for vehicle acquisition include:
- Fleet vehicles from rental companies
- Salvaged vehicles
- Law enforcement impounded vehicles
- Surplus government and authority stock
Tips for Buying an Auto at a Dealer Auction
Here are a handful of types of winning at a dealer auction sale:
- Read the catalog carefully prior to the event date.
- Attend the event live in person.
- Register early, have proof of a dealer’s license on hand, and proof that you can pay.
- Carefully inspect any automobile you plan to bid on
- Try and estimate the high and low values you could sell the vehicle for on your lot.
- Set a bid price and stick to it. Stand where the auctioneer can see you and don’t hesitate to bid.
- Have a plan for how the vehicle will be transferred from the auction to your dealership.
There is a great article on Car & Driver with more tips here.
Future of Dealer Auctions
The landscape of dealer auctions is rapidly evolving, driven by technological advancements and changing market dynamics. As we look towards the future, several key trends and predictions stand out, shaping the way car auctions and used car auctions operate.
Technological Advancements in Auction Platforms
Firstly, technology is revolutionizing the auction locations. Online platforms are becoming more prevalent, allowing dealers to access a wider inventory without the need to physically attend an auction. This shift not only expands the reach of auctions but also introduces new efficiencies in how start bidding processes are managed. With digital tools, dealers can easily view detailed information about each vehicle, including its undercarriage condition and history, before deciding to bid.
Another significant trend is the integration of financing options directly within the auction site. This development simplifies the purchasing process, enabling dealers to secure financing quickly and bid on vehicles with confidence. It also opens up opportunities for smaller dealerships to compete more effectively in the market.
Changing Inventory and Buyer Preferences
The way vehicles are being presented and selling at auctions is also changing. High-quality images, detailed descriptions, and comprehensive condition reports are becoming standard. This level of transparency helps dealers make more informed decisions and reduces the risk associated with buying at auctions.
In addition, the rise of electric and hybrid vehicles is influencing inventory selection at car auctions. As consumer preferences shift towards more environmentally friendly options, auction locations are adapting by including a greater number of these vehicles. This trend is expected to grow as the automotive industry continues to evolve.
The future of dealer auctions also points towards more personalized experiences. With data analytics, auction sites can offer tailored recommendations based on a dealer’s past bidding history and preferences. This customization enhances the buying experience and can lead to more successful transactions.
Lastly, the importance of physical inspection remains, despite the shift to online platforms. Many dealers still prefer to physically inspect a vehicle, particularly its undercarriage, before making a purchase. Therefore, hybrid models of auctions that combine online accessibility with the option for physical inspection at a location are likely to become more popular.
In conclusion, the future of dealer auctions is marked by technological integration, enhanced financing options, increased transparency, and a shift towards more personalized and hybrid auction experiences. These changes are set to benefit both dealers and buyers, offering more opportunities and efficiencies in the used car auctions market. As the industry continues to evolve, staying adaptable and informed will be key for dealers looking to succeed in this dynamic environment.
Where To Find Dealer Auctions Near Me
Dealer auctions offer a great way to save money on vehicles. The trade-off is that you must qualify as a dealer in the state and you must have a license. If you wish to try and get a dealer-auctioned auto, contact an auto auction broker. That company can do a proxy bid for you. This is what I have learned from the dealer car auctions here near me.