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THE GOOD FIGHT: Paul John, executive director of the Georgia Independent Automobile Dealers Association, discusses how the association fought against state legislation that would have raised the taxes on used-car purchases.

PassTime Partners with Verifacto

PassTime Partners with Verifacto Featured

PassTime and Verifacto announced the companies have completed a software integration

project.

Customers utilizing both Verifacto software and PassTime GPS solutions will now be able

to perform a variety of device management functions directly within Verifacto as well as

utilizing custom insurance status features.

Verifacto’s risk management system tracks insurance status and compliance for

lienholders and additional insured, combined with loan payment reminders and payment

processing.

Read 3556 times Last modified on Friday, 22 July 2016 20:21

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  • Consulting Group Reflects on Growth After First Year

    A year ago, industry veterans Tom Stewart and Richard Curtis launched  Auction Management Solutions Inc (AMS) to provide consulting services to the automotive industry. 

    This past year AMS has seen explosive growth in its core business, adding independent auto auctions, service providers, and vendors. 

    “Richard and I are humbled by the success we have achieved in such a short period of time”, Stewart said.  “We started this firm to deepen relationships between consignors and our clients, and to illustrate that independent auctions can and will continue to provide all the services consignors have come to expect”.

    AMS currently represents 17 auctions across 14 states, with new locations being added steadily. The latest addition is Rea Brothers’ Mid-South Auction in Pearl, Miss.

    “We are confident that our new working relationship with AMS is going to provide real dividends for our auction,” , John Rea, the auction’s managing partner. 

    The main focus of AMS is to provide strategic business development services, with an emphasis on processes, profitability and exposure that aid in the growth and success of the client/partners.   “It is our intent to keep our clients on the forefront of the automotive remarketing industry by maintaining a comprehensive and competitive suite of services”, Curtis said.

    AMS recently announced the addition of two additions to their staff.   

    Jamye Carpenter was brought on board in April as vice president of business development.

    More recently, Shelly Frank came on board. Frank birngs more than 25 years of experience in the auto finance and wholesale auto auction industry. 

    Frank previously served as loss mitigation operation manager of Fireside Bank, and as vice president of business development with North Bay Auto Auction. She continues to work with North Bay on projects as a consultant.

    Frank has also been active in the Western Chapter of the National Auto Auction Association.

     

    “Both of these women bring years of experience, a wealth of industry knowledge, and contribute diverse areas of expertise to the team, allowing AMS to provide all manners of service to our partners”, Stewart said.

    “AMS looks forward to many successful years of working with our clients and providing services to, and for, the entire industry.”

     

  • Uncertainty Drives Dealers in Different Directions

    The industry is in a state of transition and dealers are uncertain about the best way to move forward.

    Take the issue of whether or not to finance their own sales.

    Michael Darrow, owner, The Auto Traders in Durham, N.C., said about 40 percent of his sales are subprime deals.

    Darrow also “dabbles” in buy-here, pay-here. Lately, he’s been increasing the amount of paper he keeps for himself, doing two or three buy-here, pay-here deals a month out of 38 sales.

    “The lenders have tightened up a little bit, which is where we’ve seen more opportunity for buy-here, pay-here,” Darrow said. “Now a lender says, ‘That’s a $900 fee,’ that’s when we’ll keep it in-house.”

    Rex Echer, owner, The Car Shoppe, Salina, Kan., is acting like one of those finance companies.

    His store used to be evenly split between straight retail and buy-here, pay-here. Now retail sales make up 70 percent of the business.

    “ It’s a little safer,” Echer said.

    A major issue for Echer is a lack of quality inventory.

    “It’s harder to find anything with good mileage,” he said. “For the buy-here, pay-here stuff, I don’t know what good mileage is anymore. Maybe 150,000 or less.”

    This drives up the recon costs.

  • CarMax’s Mix Drives Earnings Higher

    Executives at CarMax Inc. attribute the company’s success to a pretty simple idea: selling what people want.

    They said the mix of vehicles positively impacted their earnings in the company’s latest quarter. CarMax reported net earnings growth of 20.7 percent in its latest quarter.

    The vehicle mix improved compared to last year’s offerings. Their percentage of sales in large and medium SUV’s and trucks rose to 27 percent, which is about three points higher than the prior quarter.

    “So even last year, when we were little bit lower in large SUV’s and trucks, we were still putting what folks wanted to buy and what were also a good deal for them,” said CarMax CEO Bill Nash. “So I think the supply has increased on these vehicles and has driven price down somewhat but again we’re going to buy what the consumers want.”

    The company’s new online appraisal initiative helped CarMax stock the right vehicles. The online system allows customers to receive a value for their vehicle before coming into the store.

    CarMax executives view buying inventory directly from consumers as a better value proposition.

    “It is more profitable than buying it off-site so we’re always trying to drive as much as possible through the line but even given this quarter where we were allowed a little more off-site purchases because the volume, we’re still able to maintain gross profit per unit,” Nash said.

    Even though CarMax is stocking more SUV’s and minivans, the average selling price remains down a bit. Nash said that this could be attributed to the acquisition prices.

    “I think this speaks to the execution that the stores are doing and the great things that are buyers do, making sure that they’re getting the best price and really at the end of the day that’s really where it starts,” Nash said. “You have got to buy the vehicles at the right price so lower acquisition prices more than offsetting the increase that you would normally see from the mix shift.” 

  • Vending Machines Prove Good Investment for Carvana

    Used-car chain Carvana is seeing strong growth thanks in part to its unique marketing, but also because of an old-fashioned basic of the business – financing.

    The Phoenix-based company is most famous for its so-called vending machines, vertical structures that house cars and use an automated system to bring them down to buyers.

    The first vending machine debuted in Nashville in 2015. Carvan now operates four total and plans on adding more as it moves into new markets.

    CEO Ernie Garcia said the vending machines are a great investment.

    “I think some of the brand assets, such as the vending machines, are a very important part of telling that story as well as establishing credibility because when you drive (and see) the big car vending machine, it gives you the sense that there is a real company underneath it,” Garcia said.

    However, the facilities also represent a fairly large investment.

    “It is the most operationally and capital-intensive thing that we do,” Garcia said.

    “It means acquiring a vending machine site, going out and finding a location, negotiating a deal with the land owner, going through entitlements with the city, and getting approved, and then physically building the space itself.”

    As Carvana grows, Garcia said word of its unique process is spreading. In addition to the unusual delivery method in some markets, Carvana conducts almost all of its transactions online.

    Garcia said new markets that are in close proximity to existing markets ramp up faster than totally new markets.

    National advertising on cable networks will play a large part in creating   awareness of what the company does to make these fresh markets grow faster, Garcia said.

    He said cable advertising makes sense as the company grows larger and that broadcast advertising will follow as it expands even more.

    In the end, financing matters more to most car buyers more than a cool delivery gimmick like the vending machines or ads on TV.

    Carvana is doing very well in this area, setting up financing for approximately 70 percent of its customers.

    Mark Jenkins, Carvana’s chief financial officer, said technology helps there, as well.

    “I think (that is) a number that’s enabled by the technology that we’ve built to provide a very seamless experience to customers who could very easily fill out a credit application form on their phone or desktop, and select from a wide variety of financing options that we make available in a very transparent way,” Jenkins said.

     

     

  • PassTime Introduces Override App

    PassTime's new override app allows consumers to request an override command directly from their smartphone.  
    From the app, consumers enter or scan their serial numbers or VINs.
    PassTime's system processes the request and sends an override command to the device (if available).
    Once the device accepts the override command, the vehicle starts as usual.

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The National Alliance of Buy-Here, Pay-Here Dealers has inducted several high-profile operators into its Hall of Fame. But this year the NABD took the opportunity to honor somebody who played...

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