Off-lease the ace of this GM Financial rotation
![image1](https://www.autoremarketing.com/wp-content/uploads/2019/04/image1.jpeg)
Image from the Elite Sales event at ADESA Dallas last week. Photo courtesy of GM Financial.
Much like the 30 clubs of Major League Baseball, General Motors Financial is spending April through October crisscrossing the country.
But instead of fielding grounders and belting out doubles, GM Financial will be providing dealers access to “thousands of the best pre-owned GM vehicles” through its sixth annual Elite Sales series.
This year’s baseball-themed series — the “Elite Lineup” — began at America’s Auto Auction St. Louis on April 4, and continues throughout the spring, summer and fall, closing at Manheim Nevada on Oct. 18.
In total, there are 11 stops on the series, with each sale featuring a majority of NAAA-certified cars, giving dealers easy access to quality used inventory — including off-lease inventory to some markets that typically don’t have as many of these cars.
“The Elite Sales format allows us to offer a higher volume of certified units at auctions across the U.S. that don’t typically have many off-lease units in their natural market. This year, we have expanded our elite sales to more markets than ever,” GM Financial vice president of auction operations John Sullivan said in a news release.
“We want to offer every dealer the opportunity to step in lane and purchase one of our premium off-lease vehicles, with the goal that the vehicles they purchase will be profitable investments for their dealerships,” Sullivan said.
Early innings
About five years ago, GM Financial remarketing was transitioning from being a traditional retail repossession offering to one that was starting to see off-lease cars arrive in “meaningful volumes,” Brad Bollman, GM Financial’s senior vice president of remarketing solutions for North America, said in a phone interview.
The Elite Sales was an avenue to introduce GM Financial to many dealers.
“Part of it was getting into newer markets or markets where there weren’t leases at all, and trying to introduce the new GM Financial (and talk) about the product offerings that we really did have,” Bollman said. “So, it was repossessed vehicles but it was also newer, lower-mileage, off-lease vehicles.”
Bollman said the Elite Sales series was almost exclusively in low-leasing markets at the beginning. GM Financial had a chance to introduce themselves to dealers and have them get to know the company — where and how GM Financial was selling vehicles, its product line and what to expect from a GM Financial sale.
And for these dealerships in areas where leasing was not as common as other markets, the company could discuss some of the profit opportunities for dealerships in buying off-lease cars, Bollman said.
The GM Financial brand certainly has become more well-established in the dealer community the past couple of the years, “so they know the types of vehicles they can expect from us,” he said.
So, these days, the Elite Sales series “gives us a way to look at markets where we don’t typically have a large flow of off-lease vehicles,” Bollman said.
“We’ll move extra volume in there; we’ll put a little bit of marketing effort and support behind it … if it’s typically a lower number of vehicles, and we’re going to offer twice as many, it gives us the opportunity to test the market, to bring in some new buyers for ourselves and also for the auction, so we can build a little bit broader buyer base,” he said. “It gives them experience with purchasing and retailing our vehicles and then hopefully expand that relationship in all of the sales channels and multiple locations where we do sell vehicles.”
Batting order
After kicking things off in St. Louis, the Elite Sales Series stopped off at ADESA Dallas last week. Its remaining schedule is:
• ADESA Indianapolis May 21
• Manheim Statesville June 11
• Manheim Nashville June 26
• Manheim Denver July 16
• Manheim Arena Illinois Aug. 13
• ADESA Kansas City Aug. 27
• Manheim San Antonio Sept. 18
• Manheim Orlando Oct. 8
• Manheim Nevada Oct. 18
Bollman acknowledged that of the 11 auctions the series will head to this year, some are in or close to leasing markets. But that enables GM Financial to build on the leasing strength already there.
“We can bring in more cars (and) have a little bit bigger sale … sometimes that bigger sale, larger offering, does attract some extra buyers,” he said. “But a good portion of them are in markets where lease vehicles are not as common for dealers.”
The sale gives dealers “a sense of the type of vehicle that we have,” Bollman said.
“They get some experience with purchasing off-lease vehicles, and then potentially, the plan is that would expand their levels of activity (in) purchasing from us, even if it wasn’t from that location which got them interested in our product to begin with,” he said. Or even turn to one of the various online channels that GM Financial utilizes for remarketing vehicles.
All locations involved in the Elite Sales are existing auction partners of GM Financial, and the sales are held on the specific auction’s typical sale day.
All units in the GM Financial consignment for an Elite Sale are offered in an open-sale format. The majority of the vehicles are off-lease, of which nearly all are NAAA Silver Certified, the company said.
The closer
A GM Financial spokesperson said the company anticipates an average of roughly 36,000 off-lease vehicles per month to return to GM dealerships over the next 24 months.
In general, bringing off-lease vehicles to markets that aren’t lease-heavy can help avoid off-lease saturation and spread out some of the volume.
“Most of these locations, we have a steady number of vehicles that are going in there. We may increase it slightly over time. But if we’re going to send almost double the number of vehicles that we regularly offer, it does move some vehicles out of those concentrated markets,” Bollman said.
“It gives us some good data. Some real data from real experience on what vehicles are worth there, what dealers are willing to pay, and then get a sense of … what could be supported well from a sale offering to sales sold perspective,” he said. “So, we get some good market intelligence.”
Experience-based data and market intelligence — “Moneyball,” indeed.