Auction Broadcasting Co. LLC sold its vehicle auction site in Bradenton, Fla., to ADESA Inc. Revenue from the deal will enable Auction Broadcasting to strengthen its Internet sales capacity, company executives say.
The sale of the 61-acre site late was completed last month. Terms were not disclosed. Auction Broadcasting is the third-largest U.S. vehicle auction company. ADESA is No. 2, and Manheim is No. 1.
Auction Broadcasting CEO Mike Hockett Sr. said the Indianapolis company will invest proceeds from the sale in an Internet system called Auction Broadcasting Exchange. The system is designed to help remarketers work more efficiently with franchised dealerships on used-vehicle sales.
"We're going to give (dealers) more information that allows them to get more money for their trades, which allows them to sell more new cars," Hockett told Automotive News.
"If the (auction) industry wants to go to the next level as a whole, we need to figure out how to help the manufacturer sell more new cars."
Auction Broadcasting President Bob Rauschenberg predicted that the online exchange will reduce the time needed to transport and remarket a vehicle from 30 to 45 days to one or two weeks.
The exchange aggregates the used-vehicle inventories of automakers, independent auction companies, large dealership groups and other operators of online auctions. The system offers specific vehicles for sale to dealerships, based on each store's sales history.
More than 1,000 dealerships use the system, Rauschenberg said. Hockett said he expects that figure nearly to double by year end.
Starting this month, the exchange system will include the services of lanelogic, Hockett said. The new Web-based system buys used vehicles for dealers.
Auction Broadcasting Exchange is separate from Auction Broadcasting Co. The auction company will be a customer of the online system. It also will handle administrative duties for the exchange, Hockett said.
Auction Broadcasting has eight physical auction sites. It expects to double that in the next three years, Hockett said.
The exchange system will allow Auction Broadcasting to limit the size of its future sites to about 20 acres since it will need to store fewer vehicles at those sites. Some of the company's auction sites exceed 60 acres, Hockett said.
He said Auction Broadcasting also plans to build an undetermined number of off-site buildings to house vehicles before they are sent to dealers.
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