Lenders Redesign Online Auction Programs

Online or in-lane — that is the choice many lenders are pondering when it comes to remarketing vehicles.

For decades, brick-and-mortar auctions dominated vehicle-resale strategies. Lenders would gather as many dealers as they could at their weekly or monthly sales to maximize returns on off-lease vehicles, fleet and rental units, and repossessions. Dealers would get to the auction early to touch and feel — and even test-drive — the cars they were considering.

But there are drawbacks to those physical auctions. Sales, often limited to once a week, are generally attended only by dealers in the vicinity. Plus transportation costs and reconditioning expenses eat into lenders’ net returns.

Enter the online component to vehicle remarketing, which started as an auction simulcast. Lenders could sell vehicles to dealers who weren’t present at the physical auction, broadening their bidder base.

In the past few years, though, web-based remarketing capabilities have mushroomed. With lenders able to mix and match online and in-lane strategies, finance companies and captives are revisiting remarketing policies, making changes and testing new methods to maximize returns.

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