Improvements in the way Manheim uses data will help defleeted vehicles sell faster and for more money, according to divisional managing director Tim Hudson.
The remarketing company is part of Cox Automotive, which in the UK also includes dealer stocking plan provider NextGear Capital, classified site Motors.co.uk, trade-to-trade online platform Dealer Auction and consumer trade-in portal Wewantanycar.com.
This gives the company access to a wide range of information which it aims to use to improve its services.
“Big data is a big thing. We are now joining up as a business to use that data,” said Hudson, who started work at Manheim UK earlier this year as managing director of Manheim Remarketing after a two-year spell as chief executive of Cox Asia Pacific operations.
“The key driver for a leasing company or fleet is to sell a car for the maximum price as soon as possible, and we are doing a huge amount to understand the data behind selecting the optimum channel to sell vehicles through.
“That could be a closed auction environment or online; it could be a physical auction or a number of different things.”
Hudson says the data will also be used to evaluate whether to repair any damage on a vehicle before selling or push it into a remarketing channel without repairs being carried out.
“Those decisions are the big ones because you can easily spend £1,000 on a vehicle, hold it for sale for three weeks because of the time the repairs are going to take and then not achieve the incremental value you need to based on that repair,” he added.
“With big data, you are not making those decisions based on theory, you are making those decisions based on real information from what we are seeing in the market.”
Hudson said a number of fleet and leasing companies, such as Arval, have their own direct, online defleet channels, and Manheim’s NextGear was launched in May last year to provide a way for traders using these platforms to finance used vehicle purchasing.
This also has knock-on benefits for residual values.
“If people are buying through these defleet channels, traders will have that ability to buy that vehicle, push a button and go through to NextGear,” he said.
“It makes it easier to buy, therefore there is more competition and therefore higher prices.”
Manheim has seen its total buyer base rise year-on-year: physical and Simulcast – the company’s system whereby online buyers can make real-time bids in physical auctions – were up 5.1% in the first three months of the year, while Simulcast-only buyers rose 17.2%.
The company has also seen growth in its Manheim Live Online auctions, but the UK remains a traditional physical auction market, said Craig Mailey, strategic planning director for Cox Automotive.
“What we see is not necessarily people switching to full online, although clearly some are, but we’ve got people who like going to a certain physical location,” he said.
“What a product like Simulcast does is enable you to access inventory around the UK from that location.”
Hudson said the physical auction remained a key part of the vehicle disposal process, predominantly because there is a physical asset which needs to be defleeted.
“The change I see is that a vehicle will be defleeted into a physical auction, but not committed to being sold there,” he added.
Instead, Hudson said the auction site would be used to capture information about the car, such as its history, condition and its specification.
“That gives you the opportunity to remarket that vehicle to the optimum channel,” he said.