Psst, dealers. Want to save about $30,000 a week?
Michael Maheras, managing partner-Phillips Chevrolet, Frankfort, IL, does this by listing the 75-100 cars he wholesales from the three stores in his dealer group on Cox Automotive’s Upside, which launched in April.
“When I was first introduced to Upside at the National Automobile Dealers Association conference in Las Vegas, I was intrigued immediately because of the guarantee. There’s no risk,” he tells Wards. “When we first tried it, everyone was excited, but nervous. We killed it that first week and have done so ever since.”
The just-launched service offers dealers an alternative to a traditional wholesale auction. Instead of prepping, delivering and overseeing real-time bids on cars, dealers relay car information to Upside.
Dealers then are notified of the Kelley Blue Book Instant Cash Offer and Upside offers the dealer at least $300 above that amount.
Sellers on Upside receive about 99.4% of Manheim Market Report (from auction company Manheim, owned by Cox) on average for their vehicles, while getting about $1,500 on average above the recommended trade-in value.
Here’s an example supplied by Derek Hansen, vice president of Cox Automotive’s vAuto: “Just last weekend, Upside received an SUV valued at $8,400. The dealer was guaranteed $9,300. Upside placed the vehicle on its site with a starting bid of $4,500 (half of MMR) with no reserve. The vehicle sold for $11,800 and the dealer received an extra $2,200.”
But what happens if a buyer isn’t satisfied with the car?
“Upside buyers would get all their money back” aside from transportation, Hansen says. “The seller also keeps the proceeds from the full purchase price.”
The program rollout began in Atlanta and is under way across various regions. Hansen expects the program to be available throughout the U.S. in 12 to 18 months.
“That allows us to start with a group of dealers in a region and work through their feedback so we can improve and grow,” says Hansen. “As you bring it on, region by region, you bring the breadth and eyeballs and audience and scale to deliver superior outcomes.”