ORLANDO -- Toyota Financial Services Inc. is expanding its use of smaller, themed local auction sales to reconnect with its dealers who attend physical auctions.
It also is studying ways to offer its used vehicles for sale individually to dealers on a daily basis whenever they become available.
Mike Reid, Toyota Financial remarketing manager, said that would give dealers immediate access to the captive finance company's vehicles.
Keeping those vehicles moving is good for the captive, too, he added. It expects its off-lease volume of Toyota and Lexus vehicles to be flat this year compared to 2014 but predicts the volume will grow 50 percent to "close to over 500,000" in 2016.
"It's all about access and catering to the dealer and making sure they have the ability to buy vehicles when they need them," Reid told Automotive News at the National Auto Auction Association conference here in September. "When you make dealers wait a specific time, maybe they are missing some opportunities throughout the week to buy those cars.
"And as our inventory grows, we're going to have more and more vehicles sitting around waiting for specific sale days. We prefer to have those cars continuously moving through the process."
During the 2008-09 recession, when fewer dealers were attending physical auctions, Toyota Financial became heavily involved with online sales. For example, it began its online weekend sales events, which run 8 p.m. Friday to 2 p.m. Monday, Eastern time.
Reid said a daily sale would be somewhat similar to an eBay sale, with each vehicle having its own start and end time. The company will use input from its auction partners and dealers to determine the length of time individual vehicles will be offered for sale, he said.
"Like anything, you're going to have to play around and experiment with the times," Reid said. "I've seen sales that are very successful within the hour; I've seen sales that are half a day; and I've seen sales that are full day."
About 85 percent of the captive's vehicles are sold to dealers online, but the company is mindful that many dealers still prefer to attend an auction in person, Reid said.
For those dealers, the company is offering "event" sales tailored to specific local markets, he said.
He said the company conducted larger event sales for a few years, but those require larger expenditures and take four to six months to plan. For example, in 2011, the company brought 200 to 250 Lexus vehicles to the Waldorf Astoria hotel in Orlando and invited select Lexus dealers to browse and buy, he said.
Now, the company has cut back on the size of the sales while doing them more frequently: once per quarter in each of its three regions. They generally feature 150 to 200 vehicles and are held at the participating auction site. The events are held on a day different from the one typically scheduled for those vehicles, Reid said.
For example, a recent sale at Manheim Nashville in Mount Juliet, Tenn., had a country music theme that started with the invitations and continued throughout the sale. Toyota Financial brought out the cowboy boots and hats for an event sale at ADESA Dallas in Hutchins, Texas.
"Each auction is unique and has its own draw, so we're looking to capitalize on local opportunities to really showcase our vehicles," said Reid. "Once you have the components in place, we found that dealers really support the sale, and it works out for the auction" as well as for Toyota Financial Services.