What is in this article?:
Price transaction transparency is why TrueCar and others are making fortunes soothing retail buyers’ fears of paying too much for vehicles. Why so many dealers don’t take advantage of the same sort of price information on the wholesale side is hard to understand.
What We Had
When some of us old guys started, the only original-source transaction data available to an individual dealer or wholesale buyer came from actually being at the sale and remembering or taking notes on a run list of what was observed, the floor price (when it could be determined) and the change from past sales.
If it was a multilane sale you could share notes and anecdotal information with cohorts and make phone calls to peers WHO attended other sales. That was it, and that’s what you relied on.
Some will remember filling out the weekly green-paper reports with retail and wholesale transaction prices and mailing them in to guide publishers to compile and massage into “guide” prices. A few may recall getting incentives from manufacturers to “fluff” the prices on their brand of used vehicles reported sold to help keep the values up.
Another practice was studying the market report mailed out by the auction operator. This was interesting reading if nothing else, and I am sure it led to some creative numbers generation by a poor back-office wonk trying to make their auction look like the place to sell.
After factory repurchase-program remarketing took off, some of the factory remarketing groups started publishing their own guide books with high/low average values by model and auctions from all over the country.
The guide opened the eyes of many dealers to the large price spreads by location and season that heretofore only had been observed by the very small number of dealers that subscribed to guide books for multiple regions or happened to own multiple stores in different markets.
The latter was exceptionally rare, as most manufacturers limited franchised dealers to a maximum of three points. They didn’t want the tail wagging the big dog.
Then the fog lifted and the smoke cleared. Manheim came out with its MMR report. For the first time dealers could do an overnight download of a complete data set of sales you could access on your computer that had not been adjusted by any algorithm or editing.
Voila, real timely data, unfiltered, unedited or tweaked. It showed immediately how thin or nonexistent transactions were on some models, where they sold and where they hadn’t. It basically was the same as the Internet MMR still supported with extra reports that some used and some didn’t.
Today, ADESA’s market report and the current MMR and PAR price reports, as well as many others, provide this original source data for free if a dealer will just take time to look. And even more is available fromfor a modest fee.