Date post: | 13-Sep-2014 |
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Automotive |
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2010 Dealer Survey: Online
Wholesale Used Car Buying & Shipping
March 8, 2010
2A Union Pacific Company
Why is Auto Transportation Important to Online Sales? Cars are everywhere!
Wholesale used car trading is growing rapidly on the web…
• Upstream, simulcast, 24x7 online • Online Auctions are becoming global markets
… oddly in many cases, shipping has been left to online buyers to sort out
• Even with upstream sales…cars must transfer from seller to buyer
• Online buyers can not ignore transportation so they limit their buying zone
Auto Transportation is the silent engine behind the explosion of e-commerce
• People buy online because it’s easy and they get delivery direct to their home
• Convenience factor doesn’t yet exist in used car market
Online trading fulfills its potential when both buying and shipping are made easy
3A Union Pacific Company
• Survey sent to 5,853 dealers in January 2010 via rental of Automotive News email list
• 169 responses, 3% response rate
• Median dealer bought 30% of total used inventory online
• 41% dealers sell 500-1000 new/used cars per year
• 90% Franchised 10%Independent
2010 Dealer Survey - Demographics
0 - 100 101 - 500 501 - 1000 1000 - 2000 2000+0%
10%
20%
30%
40%
50%
60%
19%
57%
19%
4% 2%
48%
40%
8%4%
Used Vehicle Purchases
2010
2009
Annual Volume of Used Vehicles Purchased Wholesale
% D
eale
rs R
esp
on
din
g
4A Union Pacific Company
2010 Dealer Survey - Results
• Why dealers buy online– Saves time & expense– It’s easy– Better inventory selection available
• How far away will dealers buy online?– 27.2% I shop locally within 200 miles (60% in 2009)– 47.8% I shop regionally within 500 miles (30% in 2009)– 25.0% I shop nationwide (10% in 2009)
• Dealers who buy w/in 200-500 miles asked: what factors discourage buying farther away?– 54.0% Transportation concerns– 30.0% Inventory needs met locally– 14.0% Concern with vehicle condition reports– 2.0% Other reasons
5A Union Pacific Company
2010 Dealer Survey - Results
• What dealers say about auto transportation– 64.2% want options. Let me choose between expedited delivery or
lowest cost– 18.4% I want lowest cost delivery. – 17.4% Speed is all that matters. I’ll pay more for faster delivery.
• If Internet Auctions offered integrated shipping, would you buy more online? – 67.4% of dealers surveyed said yes (vs 88% in 2009)
Comment: Online shipping of vehicles has gotten easier. Some Internet auctions now offer shipping links and there are more auto transportation web sites.
• Dealer comments about online trading:– “It seems arbitration is further complicated with greater distance” – “I would be more comfortable with the transaction [if it were integrated].”
6A Union Pacific Company
2010 Dealer Survey – Outlook
• 42% of wholesale cars sourced online 2010 vs 39% in 2009 - trending upward
Expect to buy more
About the same
Less
0 0.1 0.2 0.3 0.4 0.5 0.6
50%
45%
5%
Outlook for 2010 Online Purchases
• Of those purchasing same or less in 2010, reasons included:
– Weak economy/sales– Good local supply– Easier to buy locally
7A Union Pacific Company
ShipCarsNow = Nationwide Delivery Network Using All Transport Modes
Hawaii
Alaska
Puerto Rico and US Virgin Islands
• Rail, truck & vessel connecting all U.S. major markets
• Truck for regional moves; fuel-efficient rail for longer distance shipments
• Co-loading of new and used cars makes rail more accessible
• More options, more capacity, better value
• Easy-to-use; fully transactional onlinewww.ShipCarsNow.com
Union PacificNorfolk SouthernCSX
8A Union Pacific Company
2010 Dealer Survey - Summary
• In other areas of e-commerce, location of the product is generally irrelevant to the online buyer … but when dealers buy used cars online, they often have to worry about shipping and where the cars are located.
• It doesn’t have to be that way. ShipCarsNow offers both expedited truck and lower cost rail shipping options.
• Dealers surveyed said they would buy more if buying and shipping are more integrated online.
• Dealers, just like other consumers, want shipping options– Speedy delivery to protect a customer order– Low cost delivery to fill inventory needs while protecting the bottom line
9A Union Pacific Company
Resources for Used Car Data
• 2009 Market Report, Mid-Year Edition, Manheim Consulting
• PULSE, Latest Economic Indicators, 2009 Mid-Year Recap, Adesa
• US Light Vehicle Outlook, IHS Global Insight, presentation to ShipCarsNow/Union Pacific 1/20/2010
• AutoRemarketing Magazine
• Used Car News Magazine
10A Union Pacific Company
About
• We are a Union Pacific Company – Trusted name & leader in transportation– Delivering over 6 million cars annually
• We deliver autos nationwide– Speedy truck delivery– Economical and green rail options
• We make it easy to ship cars!– Easy-to-use, no hassle, online
www.shipcarsnow.com– One call, we do it all 1-866-207-3360