Used-car retailer Shift partners with Cox's Manheim

April 04, 2018 01:00 AM

A car is auctioned at Manheim's Chicago site.

Shift Technologies, an online used-car retailer, is partnering with Cox Automotive, using Cox unit Manheim's facilities and services to support its growth, the two companies said Wednesday.

"By removing the need for us to lease facilities, build systems, and recruit teams for physical vehicle needs, we will significantly reduce our upfront investments and can instead focus on building incredible technology that makes car buying and selling simpler," Shift CEO George Arison said in a press release.

At the Automotive News Retail Forum in Las Vegas last month, held ahead of the NADA Show, the head of another online used-vehicle retailer discussed some of the logistical hurdles that even online sales face. "We have to invest in all this technology, a huge logistic network, the ability to ship cars everywhere, really large reconditioning centers. We have to invest in the scaling that we're doing," Carvana CEO Ernie Garcia said.

The Shift-Manheim partnership aims to address some of those issues. For example, to test drive the initial arrangement, Shift, of San Francisco, used Manheim San Diego for vehicle storage, reconditioning, imaging, inspections, detailing and more. As a result, Shift processed vehicles more quickly and established a strong foothold in the area.

Shift now maintains an inventory of about 300 vehicles at Manheim San Diego. The company continues to operate its facilities in San Francisco and Los Angeles as it considers expansion into markets with Manheim facilities.

Shift currently operates in seven markets, all in California.

"There are many new players with innovative technology platforms entering the market, yet they still require physical infrastructure," David Liniado, vice president of new growth and development for Cox Automotive, said in the statement. "Our partnership with Shift is an example of how Cox Automotive can nurture and accelerate their go-to-market proposition or expand their footprint and inventory volume by incrementally leveraging our assets."