Wholesale Auto Auctions <longish>

[SMILLER@xxxxxxxxxxxxxx]

John clues us in to:

>Date: Tue, 15 Sep 1998 10:14:53 -0400 (EDT)
>From: John Planow <JRP7731@domain.elided>
>Subject: Pennsylvania BMW auction?
>
>I've been shopping around the Western, NY area for a decent E30 and
>have caught wind of something interesting.  First of all, nobody seems
>to have what I want right now (none of the very FEW applicable
>dealers, anyway), but it seems that a lot of dealers are planning on
>picking up some cars later this week.  There is a used car auction
>somewhere in Pennsylvania this Thursday, Sept 17.  I'm under
>the impression that this auction consists mostly of bimmers, but I don't
>know for sure.  Anyway, I don't know anything about the used car
>business, but I DEFINITELY want to find out more about this auction. 
>Anyone heard about it?  Do you have to be a registered dealer to go? 
>When, where, etc.?  I see no reason to let a middle man pick out my car
>for me, so if I can find a way, I'd like to get to this auction myself. 
>Thanks for any help.
>
>Regards,
>John P.
>- -an E30 in my dreams

And I add:  Here in the S.F. Bay Area / East Bay there is a wholesale
auto auction.  They take cars from dealers for a variety of reasons
(overstocked, lease returns, end of model year clear-out, etc, sometimes
dealers just need cash flow) and auction them off to dealers.  You are
supposed to be a licensed dealer to enter, but they only check IDs on
auction day.  I don't know if the dealers-only requirement is local or state
or whatever.  In other states, YMMV.  Here, auctions are held once a
week.

I visited the place several times when I was car shopping.  Cars are
marked as either coming with, or without a warranty.  Any know defects
are listed on the window sticker.  There is a test track (low speed, so no
burn-outs or 1+g turns) where you can verify that the cars run.  New
arrivals trickle in all the time, but the best variety is available late the day
before the auction.

A friend and fellow club member happens to have an auto dealer license
(not his main business).  When I found a car I wanted, he was too busy
with his real job, and couldn't attend the auction, so I didn't get the car.  A
few weeks later I found a similar car at a used car dealer that I
recognized from the auto auction.  Some body work, which I knew
about, had been repaired - with BONDO! - so I passed.

A friend wanted a used 740i and found a friendly local dealer willing to
go with him to the auction and buy the car he wanted, for a fee
(something like $200 or $300 over the auction price).  If you get in on a
deal like this, you have to arrange the financing in advance, i.e. have
cash, or make arrangements with the friendly local dealer.  The dealer
has to settle up with the auction place that day (or the next day?), so
you can't leave the financing arrangements until later.

My friend's 740i said it came "with warranty".  When he had it at the
BMW dealer for warranty work, they found evidence that the bottom of
the car had scraped and bumped over something.  Upon checking with
BMW NA, the dealer found that the car was listed as having been in a
major accident and was, therefore, out of warranty.  My friend wrote a
letter to BMW NA claiming that the car had been mis-represented to the
auction house by the dealer that provided them the car.  He finally got the
issue resolved more or less to his satisfaction without legal action, but
I'm not sure how.  Obviously, if this had required litigation, it could have
been quite complicated, involving the dealer that unloaded the car, the
auction house, the friendly local dealer who "bought" the car, the local
BMW dealer and BMW NA.  What a mess!

BTW, you know the wholesale prices listed in the Kelley Blue Book? 
Wholesale auction houses are a big source for these numbers.  So if you
go to a wholesale auction, you can expect to pay pretty much "low
book", or looking at it another way, what you pay will turn into "low book"
real soon.

So the big lesson here is:  If you find a friendly local dealer and you find
a car at your local wholesale auction, check the car out real carefully, or
maybe bring home the VIN and run it against one of those web sites that
checks title and such.  Even if you think you are getting a car under
warranty, it may not be covered.  But, if you do use this approach to
buying a car, you can expect to save a ton of money, and that ain't bad!

Also BTW, the Bay Cities Auto Auction sells all the various versions of
the Kelley Blue Book in a vending machine in their lobby, bring lots of $5's
and $10's for the machine.  You can get the same data from the Kelley
Blue Book web site (I think it is www.kbb.com), but only on a per-car
basis.  If you want info on lots of cars, the book is better.

Well, that's pretty much all I know on this subject, hope it helps everyone
find the cars of their dreams.

Scott Miller
Golden Gate Chapter
BMW CCA #44977
1990 325i/is hybrid that I had to buy from a private party...

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End of bmw-digest V9 #177
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