Hammer Time: The Polar Bear
Back in 1999 I was having the time of my life. In three months I had managed to become a part of five different auto auctions in the Southeast. My job in the beginning was to be a ringman. The guy who would hoot, holler and help the auctioneer create the urgency to buy. Two degrees. A BBA and an M.Ed. and what was that day job again? To point at car dealers who wanted to bid and go ‘Yep!’. You know what? I was damned good at it.
As time went by I started to get more exposure on the block. My auctioning in Spanish helped land a couple of good jobs. Including a short stint at Logandale Auto Auction. I would work the ring. Relieve the main auctioneer at times… and get paid a ridiculous amount of money for two to three hours of work. I would go home with no stress. No emails or phone calls to return. No meetings to attend. It was paradise on Earth… and now it’s finally disappearing.
I saw the writing on the wall back in 2001. Copart, the largest salvage auction company in the world went completely online. One week they had employed nearly a hundred auctioneers. 30 days later it was zero.
No auctioneers. No ringmen. Nothing but an online system that would simulate the real deal to a dealer sitting in front of a computer. The Japanese had been doing it for decades and now ia long line of companies would follow in their wake.
GM devised their own online system. So did Ford, Chrysler, and a long list of other manufacturers. Pretty soon many dealers didn’t even need to get their vehicles at the auctions. There was plenty of off-lease and repossessed inventory available that would never see the light of the auction block. So the ‘factory’ side of the business began it’s steep decline.
There still are ‘open’ and ‘closed’ factory sales at the auctions. Open means non-franchise dealers can attend the auction. Closed means you better have the brand name on your shirt when you bid. Either way there are now far fewer vehicles for auctioneers to sell. It was a trend that would eventually leave many of my friends chronically underemployed
During this time public sales also began a rather steep decline. One of the sales I used to work every week, Days Auto Auction, used to sell 100 vehicles every week. They MINTED money and nearby competition was few and far between. Between the seller and buyer fees, they would net well over $20,000 for each weekly sale. The same was true for another Atlanta institution. ADESA Atlanta had one of the most popular public auctions anywhere in the Southeast. Their proceeds were more than double that amount.
Back in the Clinton era, it seemed like every small or big Southern city offered more than one public auction. Many of the vehicles were trade-in’s to new car dealers who valued immediate liquidity over remarketing 10 year old metal. A lot of these cars were perfectly fine. I made a very nice supplement to my weekly work by buying vehicles on the side. It was a great business for those of us who lived it.. But like all free markets in America, the crybabies, idiots, fraudsters and ambulance chasers slowly turned this segment of the market into a molting morass of mediocrity.
ADESA dropped their public sale after the ‘litigious issues’ of selling to the public began rearing it’s ugly head. Emission issues and ‘washed’ titles slowly became a living nightmare for these auctions. Auctions were negligent. The public was ignorant. Some dealers were predatory. The auctioneer and ringmen? Just cogs in a slick wheel disguised as capitalism. After a while the inventory went back to the dealer domain.
With less business, ADESA fired their ringmen and went from eight lanes to only four. That means the number of auctioneers they needed in Atlanta was effectively halved and their ringmen were zeroed.
Day’s Auto Auction, my old weekly public sale, became a once a month dealer sale. They soon sold less than a fourth of their previous volume. They’re now a storage operation with very little auction business. But they were only one of many dominos. Pretty soon this cancer of fewer vehicles and more hoops even went straight up to the 800 lb. gorilla of the auction business, Manheim.
For a long time Manheim enjoyed the largest auto auctions in most of the United States. A goliath owned by a conglomerate, they made money well into the nine figures. Manheim expanded to Europe, Canada, and China with sales volume well into the millions. . Even General Electric tried to compete with them… and failed. Up until the late 1990’s Manheim was the absolute unstoppable force when it came to the auction world.
But then it all went to hell for Manheim in a way eerily similar to General Motors back in the 1970’s and 80’s.. Successful auctions became fiefdoms. Those feifdoms would literally compete against one another for the same business with the blessings of the corporate mothership. Slowly the mothership began slashing it’s own throat with some sales even having their auctions on the same exact day.
The Atlanta market embodied this mentality. Two Manheim auctions, Georgia Dealer’s and Bishop Brothers, have competed against each other on Tuesdays for well over a decade now. They even competed for the same business. When did Manheim’s competition run their sale? Why Wednesdays of course! It was great business model for employing us auctioneers and ringmen. But after 10+ years the powers that be finally woke up.
Manheim is now finally going to shut down Bishop Brothers Auto Auction. A successful 1000+ vehicle sale will now be slashed, burned and merged with another Manheim sale. Bishop Brothers started not too long after World War II and continues in an area of Atlanta that is arguably in it’s last throes. The type of place where the streets are regularly re-named after city cronies. Strippers, hookers, and abandoned storefronts have adorned the area around the auction for a long time. Now the great expanse of blacktop will soon be as silent as the nightlife is noisy.
Auctioneers now have to go well out of Atlanta to find steady work. The guy that had five or six sales back in the day now has two or three… if they’re lucky. Today’s auctioneers are like polar bears. They have to go further and futher out for that same hunk of ice to stand on. That chunks of ice are getting smaller with fewer vehicles available to sell. It was a nice to have a fifteen hour workweek back in the day. Today I simply sell my own and avoid auctions like the plague.
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Am I the only one who finds it strange seeing "the crybabies, idiots, fraudsters and ambulance chasers" blamed for the failing of the MIGHTY FREE MARKET while mere lines earlier, it's lamented that many people were replaced by an infinitely more efficient (and much cheaper) machine? Your ideal of a free market cuts both ways. Sounds to me like the market realized your services were redundant in the face of computer technology, as opposed to some cabal of whiners screwing you out of a job. You can't have your cake and eat it too, Steve.
Two entirely different auction markets. The online selling refers to the dealer auctions. More specifically, it refers to the salvage auctions and clean title auctions that serve car dealers around the country. Public auctions deal with an uninformed and inexperienced public along with litigious issues that would not normally come up when an experienced professional attends a sale. I'll give you a quick example. Auto auctions have 'announcements' before a vehicle is sold that may tell you about a vehicle's history or current state (frame damage, salvage title, bonded title, expired emissions, etc.) I have seen public buyers ignore these announcements and then try to buy the vehicle without realizing that history. I've also seen dealers do the exact same thing. The difference is that the public would have legal recourse in some of those situations. Even though they may have bought a vehicle without current emissions, it is illegal for anyone with a dealer's license (auction or dealer) to sell that vehicle to someone who lives in an emissions county. The public can easily file a suit and pursue a full refund of that vehicle. The auction in this case can also be fined by the state for doing this. A dealer does not have that recourse. He is an expert and not a 'retail party'. Therefore he has to keep the vehicle and perform the needed work if he plans to sell it to someone who lives in an emissions county. One of the auctions I wrote about supposedly got fined for selling a non-emissions vehicle to a buyer who resided in an emissions county. They also were supposedly warned that if it happened again, the next fine would be in the six figures. They closed the public sale. End of story. A 'seller' is supposed to provide very basic disclosures whenever liquidating a vehicle. The lack of time to register vehicles for public sales can easily result in a sales transaction that may be illegal because that seller has not furnished that information. Therefore very few established dealer auctions are willing to invite the public. Fewer auctions means fewer auctioneers.