The car auction: A possibility for bargains
When planning the purchase of a new car, a car auction is another possibility besides the purchase at a dealer or from a private seller. This possibility only occurs to least of the buyers, as automobile auctions in general raise fears of doing a blind bargain. A test drive is not possible and the car canât be precisely inspected before purchasing either. However, the car auction is also a way to get your dream car for a fair price with a bit of luck. In this guide, we will explain to you how you can bid on used cars and for whom this purchase method is most suitable. Furthermore, we will shine a light on auction portals, such as Emirates Auction or Copart and explain to you how municipality or police auction work. Would you like to buy a car during a car auction? Our checklist will prepare you perfectly.
How do car auctions work?
During an auction, sales platforms are available, on which the participants can make a binding offer for the represented objects and outbid one another for as long as a highest bid for a product has been determined and there are no more bidders left. This way the one who makes the best offer during a certain period get the desired object. There are both live auctions, where bidders have to be present, as well as virtual auctions, where internet access is all you need. Most of the times the cars that are auctioned off this way come from manufacturers, small companies, leasing and financial incorporations, car dealers, car importers, and banks. Car auctions are ideal for people looking for both a bargain and some kind of a thrill during a car purchase. It is not uncommon that during a car auction models are auctioned off for a price, which is way below the regular price of the current second-hand car market. Nevertheless, until the very end auction participants have to keep cool, as it remains open until the end, if you actually bought the car and, if so, how much you have to pay for it. It also has to be considered that even if you successfully buy at an auction, you do not really know what you will get for your money. Details are often not listed and explained sufficiently, the car cannot be tested and you will only get to know the quirks of your new car after buying it.
Advantages and disadvantages of a car auction
Advantages
+ occasionally cheap car purchases
+ thrill during bidding
Disadvantages
– no detailed assessment possible
– bids are binding
– occasionally only professional bidders
– risk of overbidding
– mostly scrap or junk cars
Car auction: Copart, Emirates Auction or municipality impounded car auctions?
Copart, headquartered in Dallas, Texas, is a provider of online vehicle auction and remarketing services in the United States (U.S.), Canada, and the United Kingdom (U.K.) and has acquired or opened operations in Germany, Brazil, Spain and the United Arab Emirates. Copart provides vehicle sellers with a range of services to process and sell salvage and clean title vehicles. Copart’s buyers are principally used vehicle dealers, dismantlers, rebuilders, exporters and, at some facilities, the general public. Vehicle sellers at Copart auctions consist primarily of insurance companies but also include banks and financial institutions, charities, vehicle dealers, fleet operators, government agencies and rental car companies. Copart however is primarily aimed at commercial customers both when buying as well as during auctions. The company offers onsite auctions as well as live online auctions where bidders can attend the event virtually. There are also pure online auctions. When a commercial bidder wants to purchase a car by auction here, he will have to prevail against many other fellow campaigners, most of the times within a few minutes, as an auction at Copart doesnât last longer than that.
Emirates Auction is an auctioneer for distinguished number plates for various government authorities in the Gulf region and used cars in the UAE. They also run real estate auctions for industrial and government sectors. After registering with Emirates Auction, cars can be purchased via physical bids on-site or via an app. The advantage of this portal over traditional auction houses is, that they also offer interesting other auctions, such as homes or number plates.
Municipalities, Police, Custom and other public authorities auction off confiscated and decommissioned vehicles. Commercial bidders as well as private citizens can attend these car auctions oftentimes carried out by private auctioneers. The police offers distained or confiscated goods and finds, same as a custom auction offers a wide variety of goods. Especially craft enterprises benefit from the authoritiesâ car auctions as many utility cars and transporters are offered there. Furthermore, customs can be considered as a very reputable auction provider. However, even municipality, police or customs auctions have a few disadvantages: the auction sale for example may be cancelled unexpectedly when the owner redeems the distained pawn, cars do usually have a rough past, no clean title (running court cases), have vegetated for long periods of times and cannot be inspected fully before purchasing, as some of the cars even come without keys.
Checklist car auction
In case you want to purchase a car at a car auction, you should consider a few important facts beforehand. We have put a checklist together with which you can check before the auction if you are familiar with all the important facts and with which you can successfully seal deals at auctions.
- Decide which auction portal is in line
- Know the reference prices
- Examine the car description thoroughly, if one is available
- Have the car value appraised by a third party, if possible
- Determine a personal limit before the auction
- Never exceed your personal financial limit
- If the car auction is of temporary nature start bidding shortly before the end
- Remember that a test drive and an inspection are not possible
- Offers are always legally binding