July 15, 2014
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Transcript of July 15, 2014
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July 15, 2014
Auction Industry Leaders, Class III, Spokane, WA
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Your HomeworkThe wholesale market was strong and active and
climbing in April when we last met. Has it turned, when did it turn and by how much? Relate this to values, consignment and conversion.
Do you think the wholesale market is better or worse today than one year ago in 2013: values and volumes of offerings?
Gas prices are getting the headlines. What do you feel they will peak at? What effects/reactions do you expect?
The Broad View
A solid spring: Strong tax season activity
Later beginning of strength: Winter delayed
Lasted longer on the calendar: Solid through 2nd week of May
Is the market better or worse?
Most recent market changes
Previous month market changes
Previous year ago period market changes
Better than previous 3 month period
Year ago 3 month period
Better than annual forecast
Year ago 12 month market changes
Is the Market Better or Worse?
This Month, Quarter or Year over Year?
In each comparable periodThe answer is lower depreciation
today:Except May to June 2014
NAAA physical auction volume:
2013 marked the second consecutive year of increase in unit volume since 2007.
The number of units entered increased 4.3 percent to 15.2 million.
The number sold grew 4.2 percent to 8.2 million for a conversion rate of 54.2 percent.
Dealer-consigned vehicles represented the largest number of units sold at 58.8 percent.
Financial/fleet accounted for 34.3 percent.
Supply Levels Growing
NAAA physical auction volume: Increased consignment and sales volume 2013 over 2012
Expect the same increase in 2014
Total new sales levels 15.6M in 2013 16.1M in 2014 projected 16.5M in 2015 projected
Off lease increasing Part of trade-ins: just know when and sometimes where
Supply Levels Growing
High penetration of lease in New England
Creates a tough remarketing area
Online and Upstream to distribute the volume
Transportation services
Extra Reconditioning: Front Line Ready
EOT Oversupply?
2011: -7.7%
2012: -12.4%
2013: -12.8%
2014: -13.5% projected
2015: 15.5%
Annual Depreciation Trends
3 segments increased during June
MPT, MVC & FPT show strength
Greater than traditional depreciation:All Cars, mostly small
14 increased in last month of 1st Qtr
Solid Annual Market Changes
Only the Prestige Luxury Cars over pre-recession annualdepreciation
7 under 10% depreciation: All truck related
End of 1st Qtr Results
If history repeats, second qtr could be better. Must overcome strong March.
1st Qtr Results
End of 2nd Qtr Results
History did repeat, second qtr was better as spring market extended into May.
-5.2% -3.3%
2nd Qtr Results
Truck Market Continues Better Depreciation2nd Qtr market changes
1st Qtr market changes
Cars and Trucks almost identical change for quarter
Mazda activity
Spring market seasonality is prevalent in the compact cars
Mazda activity
Mazda5 also affected by the spring market strength
Mazda activity
As the volumes have increased the seasonality spikes have leveled out somewhat
Mazda activity
CX-7 closing gap to segment in 2014
Mazda activity
Smoother movement in this segment in 2013 & 2014
Land Rover activity
Model fairing better than segment in 2014
BMW activity
Increased supply of 2010 EOT in current wholesale market?
Mix in segment varied
Toyota Activity
Spring market seasonality is prevalent in the compact cars
Every March there is a climb
Toyota Activity
Combination of Hybrid, Electric and Plug-in reached 3.7%: Wards
Toyota Activity
2014 brings better retention in relation to segment average
Seasonality variations
Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec0.9500
0.9600
0.9700
0.9800
0.9900
1.0000
1.0100
1.0200
Prestige Luxury Cars
Seasonality variations
Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec0.9400
0.9600
0.9800
1.0000
1.0200
1.0400
1.0600
Compact Cars
Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec0.9600
0.9800
1.0000
1.0200
1.0400
1.0600
1.0800
Compact Crossovers
Seasonality variations
Seasonality variations
Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec0.9700
0.9800
0.9900
1.0000
1.0100
1.0200
1.0300
1.0400
1.0500
1.0600
Full-size Pickups
Gas prices
Heading up!
Gas prices
$.21 over year ago
Less volatility in 2014, but lower overall points
Will the current price trend continue?
Gas prices
Notice the level pricing of diesel throughout the year:Does this encourage more diesel products, car and truck?
What do you expect?
Are there certain concerns?
Any additional questions or comments?
Heading to the 3rd quarter
Is your mobile app setup?
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Set Up Academy Members w/Mobile App?Complementary mobile app for each of you throughout the
Auction Academy program.Auto and specialty markets: iPhone or Android
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Set Up Academy Members w/Mobile App?
Values
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Just call or emailRicky Beggs VP, Managing Editor770.533.5221 w, 404.915.4215 c
[email protected] West, VP, North American Auction Director
770.533.5230 w, 404.915.2428 [email protected]
Questions?