Until about two years ago, Mark Knauss, general manager of Mercedes-Benz of South Atlanta, regularly drove two miles down the road to his local Manheim auction to buy used vehicles.
Now when he buys used vehicles from auctions, it's almost always online with his dealership computer. When Knauss is at home or on the go, he buys with his iPad. He has fingertip access to reports on vehicle specifications and service and repair histories.
"It's all about efficiency and maximizing our reach," Knauss says. "Inventory is a challenge."
A decade ago, the notion of dealers buying used vehicles online was a novelty. Now it's a necessity.
Faced with a sluggish economy and a tight used-vehicle supply, dealers are under pressure to find and turn used vehicles quickly. The Internet saves dealers time and costs associated with traveling to physical auctions.
Dealers' shift to tire clicking from tire kicking is causing captive finance companies to put more extensive safeguards in place to reassure buyers of vehicle condition. Sellers provide vehicle listings packed with photos of vehicles and damage and detailed condition reports.
By going online, dealers get anytime, anywhere access to used-vehicle inventory without leaving their dealerships. Captive finance companies get a bigger, national audience for their off-lease vehicles and save the expense of transporting those vehicles to auctions. The trend has pushed established auction companies to revise their strategies, close some auction sites and buy online companies.