Photo via Wikimedia.

Photo via Wikimedia. 

Consignments were down in May and June; however, healthy sales percentage rates kept sales numbers at Northeast auctions at relatively stable levels, compared to the year before, auction managers told Vehicle Remarketing.

This trend materialized at Central Pennsylvania Auto Auction in Mill Hall, said Doug Miller, vice president and COO.  

Miller didn't provide final numbers for June, but in May, his auction — which typically runs 600 to 650 units a week — sold about 1,500 vehicles. The best-performing vehicles in May and in June were seven- to eight-year-old trucks and SUVs.

Two other segments that performed well in May and June for him were high-line and sporty cars. Sales for these cars, Miller said, jump during the spring market as buyers rush to bid on vehicles for the nice weather. He expects sales for these segments to come back down in July.

Some of the worst-performing vehicles in May and June were older, later-model and less-expensive vehicles. Sales for cars in $1,000 to $3,000 range dropped off during those two months, Miller said.   

The dip in consignments in May and June was not a new trend, he noted. Consignments at his auction have been trending down since the beginning of the year, and Miller credits this to a fairly new change among new-car dealers.

"Consignment has dropped a little bit from new-car dealers," Miller said. "Typically in the years past, they would trade-in a 3- to 4-year-old car with 70,000 to 90,000 miles on it and then they’d send it to auction to wholesale right away. Now we’re seeing quite a few of those franchise dealers sitting on that product that they take in on trade for a good chance that they’ll be able to retail it."

Three states over, in Richmond, Maine, general manager of Port City Auto Auction Mark Wescott has experienced many of the same trends. Consignments at his auction during May and June were also down, while sales percentages were up. Trucks and SUVs were the top performers, while and older, higher-mileage trades underperformed.  

Wescott expects consignments and sales to dip in the coming month, as July is notoriously quiet in the auction business, he said. Sales should begin to pick up in August and September, however, as those are typically good months in the northeast.

Julie Quinn, general manager of Rochester Central Auto Auction in New York, offered her input as to why she thinks consignments have been down in much of the northeast region these past few months.

“Dealerships are trying to liquidate their later model vehicles instead of auctioning, which is hurting supply to auctions,” Quinn said.

Consignments and sales weren’t down across the board. John Vance, president of Bloomsburg Auto Auction of Bloomsburg, Penn. said May was a fairly good month for his auction and June has been even better. The strong performances in these months have been a reversal of how these months used to perform just a few years ago.

Vance’s auction is relatively young. In August, the auction will turn four, and he said that May and June weren’t always strong months for him. In the past, January provided a so-so start to the year, and sales would get progressively better until it reached a high point in April. Sales would then slack off in May, and pick up a little bit in June.

This year, sales did not slack off in May and June was even better, he said. He credits his auction’s strong performance in these two months to a shifting tax season.

"I think we’re into a new cycle," Vance said. "I don’t think the tax cycle is there anymore and the money doesn't get spent in April. It stays into May and June. We’re seeing a different cycle coming into the market."

A lot of his dealers, he explained, used to have exceptionally strong sales in February, March, and April. This year, they’re selling about half of what they used to in years past. His customers haven’t seen a benefit from the “tax season” for the past two years, Vance said.

In May, Bloomsburg Auto Auction sold around 200 to 250 cars. June should see similar numbers, Vance said. Like other auctions in the northeast, pickup trucks were his bread and butter during May and June. SUVs also performed well. Foreign late model vehicles, on the other hand, were harder to sell.

One trend that has been on the minds of many in the remarketing industry is the wave of lease vehicles coming off contract and entering the wholesale market. Miller of Central Pennsylvania Auto Auction said that he has seen an increase in off-lease volume.

"Everyone has told me that there’s all these lease cars coming to market, but I haven’t seen them," Vance said. "The big auctions like Manheim and ADESA have been holding their numbers because of the increase of lease cars offsetting the decrease of dealer cars, but I haven’t necessarily seen this huge influx of lease cars that are supposedly everywhere," said Vance.

While May and June were weaker months for the majority of these auctions, all of them expect sales to improve in the months to come. Sales aren’t expected to rocket back up, but they are expected to level out, with the possibility of a slight upward trend for some.

Editor's note: This is part of an ongoing series that goes beyond the numbers to provide a snapshot of market conditions in the vehicle remarketing industry in the Northeast, Southeast, Midwest, Southwest, Rocky Mountain and Pacific regions. The Northeast region includes Connecticut, Delaware, the District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont.

About the author
Eric Gandarilla

Eric Gandarilla

Senior Editor

Eric Gandarilla is a former Bobit editor who worked on Automotive Fleet and Vehicle Remarketing.

View Bio