Automakers and auto auctions no longer have a monopoly on the wholesale distribution of used vehicles over the Internet.
At least two publicly traded companies - autobytel.com inc. and AutoTradeCenter.com Inc. - have launched Web sites to offer subscribing dealers the equivalent of an online auto auction.
About 2,700 dealers currently list their new and used vehicles on autobytel's retail car-buying site. As of Thursday, April 1, those dealers now can sell used vehicles to each other through the company's new Wholesale.autobytel.com Web site.
Two days before, subscribers to AutoTradeCenter, about 400 dealers, were able to participate in an online test sale and bid on a single dealer-consignment vehicle. AutoTrade-Center could not estimate how many dealers participated.
Tim Walker, director of used products for Irvine, Calif.-based autobytel, says autobytel dealers can use the Web site to find vehicles around the country. 'It will be primarily dealer-to-dealer sales,' he said.
Wholesale.autobytel.com also offers many of the other services a physical auto auction offers, including vehicle transportation, floorplan financing and reports on what vehicles are selling.
For the dealer who buys the vehicle, the transaction is free. Autobytel will charge the seller a fee. Walker said the company is considering a 1 percent fee on the sales price.
Walker said dealers could list vehicles on the wholesale and retail sites, testing both markets.
AutoTradeCenter.com, however, is sticking to the market it knows best, wholesale auto sales. Despite its Internet-related name, Auto-TradeCenter.com is a traditional used-vehicle broker, with most transactions done in person or by phone. Until recently, the Scotts-dale, Ariz., company did business as Auto Network Group Inc.
AutoTradeCenter.com still is working on the site. CFO Mark Moldenhauer could not say when the site will be finished.
Once it is running, he said, neither the buyer nor the seller will pay a fee on transactions, adding that AutoTradeCenter.com is talking to potential advertisers.
Traditional auctions are not worried about the newcomers. Members of the National Auto Auction Association, who sold an estimated 8.3 million vehicles in the United States last year, are working with automakers and other vehicle consignors - including finance and fleet companies - to corner the Internet market.
Manheim Auctions Inc. announced last week that it had sold 6,351 used vehicles - worth more than $100 million -online during the first quarter of 1999, nearly quadruple its Internet sales for the same period in 1998.
Manheim and other major auction groups also are working together through Auto Auction Services Corp. to create a common online auction sale system.
Said Don Meadows, vice president of Auto Auction Services: 'I don't think anything we do will be a reaction to what autobytel or a retail site is doing.'