Cars.com targets Accu-Trade to add vehicle sourcing

Cars.com plans to launch online vehicle sourcing capabilities across its platform after the acquisition of Accu-Trade, citing the need to help dealerships find inventory amid supply constraints.

The dealership technology company based in Chicago last week said it signed an agreement to purchase 100 percent of the assets of Accu-Trade, a provider of vehicle appraisal and valuation data and logistics technology, for $65 million in cash. Accu-Trade's assets include Galves Market Data and Made Logistics. Cars.com said it expects the deal to close in about 30 days and that it will make an earn-out payment to the sellers of an additional $63 million contingent on the acquired business hitting certain performance targets.

Cars.com said the addition of Accu-Trade — founded in 2015 by Robert Hollenshead, who will be an adviser to Cars.com and Accu-Trade — will give its dealership customers the ability to buy and sell vehicles in both dealer-to-dealer and consumer-to-dealer transactions. Accu-Trade's technology, including an instant guaranteed offer tool and VIN-based vehicle valuation and appraisal information, will be integrated across Cars.com's online vehicle listings marketplace and dealership websites.

Cars.com CEO Alex Vetter called sourcing inventory "the No. 1 pain point for dealers today" in an interview last week.

Combining Accu-Trade's technology with Cars.com's vehicle shopper data will help dealerships know what they can pay to acquire a vehicle and speed up their inventory turn, Vetter said.

"What we've seen from a lot of the Accu-Trade dealers is they've turned their wholesale operation from a loss leader into a profit center," he told Automotive News. "As we add in the consumer volume of Cars.com and our dealer websites and bring those consumer opportunities directly to dealerships, we think we can change the game here and allow dealerships to basically be a much more efficient platform unto themselves."

Jeff Zamora, Accu-Trade's chief technology officer, who will join Cars.com's leadership team, said the combined companies will give dealerships a transparent, data-driven process for buying and selling vehicles.

Vehicle listings company TrueCar Inc. acquired a 20 percent stake in Accu-Trade in 2019. A TrueCar spokeswoman last week said the company will sell its stake when the Cars.com acquisition closes and that Accu-Trade will continue to work with TrueCar to power its True Cash Offer valuation engine.