Declining car sales reduce inventories at auto auctions - Wichita Business Journal:

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Auto auctions are seeing the same declining revenues as the dealerswthey provide. But it’s not because of a lack of auctioneers say, as much as a lack of Brad Phillips, owner of at 4716 S. Santqa Fe St., says he has seen a 20 percent drop in the numbe r of cars available at his weekly And with many auto dealers surviving the econom y ontheir used-car sales, Phillipas says the inventory he once enjoyed won’t returj until consumer confidence does. Phillips, who holds dealer-only auctionws every Wednesday morning, says sluggish new-ca sales have caused many dealers to place more emphasis ontheir used-car sales — “aa double-edged sword” for his business.
Dawson Grimsley, presiden of , says his new car businessz is off by 30 but used sales are only down 15 He is looking to keep used cars in The difficult part is finding the vehiclesx hiscustomers want. “Nice used cars are harder than heck to he says. Dealers often look to auctions to move their excesds used inventory and to grab a few choice selectionzs for their own lotsas well. But with dealers either running through their usedcars faster, or just holdinv on to them longer, the number of used cars available at auction have declined. Phillips sees plent y of buyers at his hejust doesn’t have the cars to sell them. Last year he says the weekly grossaveraged $1.3 million.
This year, it’ s $700,000. Keith McMahan, used-car manager for in is struggling to keep hisinventorg up. “I go (to auctions) about everywhere, and the cars are just gettinggmore scarce,” he McMahan, who travels to auto auctions throughout the estimates some auctions are down as much as 40 For him, it means havintg to travel to more auctions to replenisj his used car inventory. “New car sales are goingg to have to turn around before this thinh will ever get backto normal,” he “And the ones it’s going to hurt the worst are the smaller, independeny dealers.” Craig Harms, general manager of at 400 S. West St.
, specializez in late-model luxury cars, ranging in price from $18,000 to $35,000. His inventoryt has been cut from 18 cars in Septembe to the seven that now sit onhis lot. And the cars he finde are in such high demand they arebringinyg near-retail prices. “We’re just not able to buy cars and make themarginz we’d want,” he says. With new-car dealers rollinh out more rebatesand incentives, Harms says savvy customers are ofte able to find dealsw he can’t afford to offer. Wilmza Grice, owner of at 3820 S. runs the only auto auction in the statse open tothe public. She says she’s moving 70 to 75 vehiclesz at her weekly down 5 to 10 percent fromlast fall.
She believea those numbers won’t increase until new-car salesz pick up. Phillips says that’s just not happenin g yet. “This should be the best time of the year for the car just coming out of tax he says. “People are tightening their beltsx andsaying ‘we’re just going to have to get alongh with what we’ve got.’ ”