Auto Export Guide
Any respectable automotive wholesalers know that auto auctions are where you go to grab some cheap sleds (read: used cars) to flip for profit or to export. I have spent two decades doing just that and I wanted to share a few tips and experiences with you.
Buying used cars from US auctions and exporting them overseas (or into Mexico) doesn’t need to be a lot of work if you know your resources. I hope my guide about purchasing vehicles from car auctions for export helps you in this business.
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Wholesale Auto Auction Types – Public vs Dealer
Some states in the US allow dealer-only auto auctions but most states like Texas and California also allow the public car auctions. Online car auctions at local wholesale auto auctions and also online-only websites that hosts car auctions are very popular in the United States. Below are the various types of auto auctions and their descriptions:
Buy Used Cars from Public Auto Auctions
If you are looking for pre-owned good quality vehicles at decent prices, then public auto auctions are the right place to buy used cars and trucks.
Public auto auctions are open for the general public without any need for an auction license. You may be asked to make a small deposit in order to bid, but it will be returned in full if you do not buy any cars in the auction.
Where Do Vehicles Come From at Public Auctions?
It is a misconception that public auto auctions sell only repossessed cars from banks or government seizures, but auction cars will come from off lease fleets, retired rental fleets, private for sale by owner cars, and more.
Automotive dealers sell their old cars to make room on their car lots for newer or more popular models. Non-profits sell donated cars to raise money.
Government agencies also sell used cars, but these are usually fleet surplus from their transportation departments and also sometimes vehicles that were repossessed or impounded.
How to Participate in Public Car Auctions?
To buy cars in a public car auction held onsite, just look for a car auction near you at Car Auctions USA. They can use ads, car blogs, and search engines to locate these events. Checking non-profit websites like Goodwill is also useful, as they often sell donated cars at public auctions.
Once you know where the auction is, you need to register for it. If you win a bid, you’ll have to pay an auction fee to the company running the event.
This fee usually ranges from 3-10% of the car’s final bid price. Fees at public auctions are generally higher than at dealer-only auctions.
Buy Used Cars from Dealer Auto Auctions
If you are a used car dealer and looking for later models and used cheap vehicles in bulk to sell outside the United States, then you need to look into wholesale dealer auto auctions. Ordinarily, dealer auto auctions are closed for public bidding, and only people with auto dealership licenses are allowed to attend.
Where Do Vehicles Come From in Dealer Auto Auctions?
Every year, millions of vehicles are sold at dealer-only auctions at wholesale prices. These vehicles come from a variety of sources that we are going to describe below:
Off-lease Vehicles: The cars that have hit the end of their lease contract are referred to as off-lease vehicles. The closed auctions like dealer-only auctions are considered the best places where lessors or financial agencies sell their off-lease cars.
Fleet Vehicles: Rental or supply chain management companies have a good stock of fleet vehicles that are consisting of an array of different sizes and models of trucks, vans even luxury cars. Yes, fleet vehicles are also being displayed for bidding in dealer auto auctions at justifiable prices.
Off-rental: Rental companies also elect closed auto auctions to sell their vehicles. Like off-lease cars, these are too old model ones but could be sold at a reasonable price after making some repairs by auto dealers later.
Repossessed Cars: Banks and finance companies, including title pawn companies, will sell their repo cars at auto auctions. You can find them at public car auctions, but dealer only auto auctions will usually have them in bulk with less buyer fees and better customer service, in my experience.
Newer model vehicles are also available in dealer auctions, but most of them are out of warranty. Insurance agencies also use dealer car auctions to sell salvage vehicles (Wrecked cars aka In-Ops) because auto salvage rebuilders can repair them and sell them again.
How to Attend Dealer-Only Auctions?
Compared to a public auto auction, dealer car auctions are definitely worth it if you have a dealers license or an auto broker that can get you in. The bidders are more serious and informed, the staff are better trained, the vehicles for sale are more numerous, and also I enjoy all the extra amenities these auctions offer to dealers.
By the same token, with an auto dealer license you may also bid online with these monster online dealer auction sites:
ADESA: It is one of the pioneer online vehicle auction operators of North America where buyers only need to get registered on this site to participate in live wholesale dealer auctions.
Manheim: This is another US-based automotive auction company that conducts both online and traditional dealer-only auctions in Australia, North America, Asia, and Europe.
America’s Auto Auction: This network of dealer car auctions has grown a lot in recent years and has recently bought XL Automotive Group to add even more dealer auctions to their list.
On the other hand, if you don’t have a dealer license and you want to get vehicles like a dealer, then you should go with online public auto auction bidding sites that don’t have the restriction of a dealer license.
Buy Used Cars from Online Auto Auctions
The popularity of online automotive auctions is snowballing in the US since last few years. Online auto auctions are not only desired destinations to buy a new car but if you have a plan to sell or export a used car overseas, then these online platforms could also be a great place to get used vehicles.
Withal, buyers should keep in mind that before bidding online they must have 10% of the cost of the automobile in their account. Here, are some top online auto auction sites from where you can purchase a used car via bidding live.
eBay Motors: With a user-friendly interface and convenient bidding process, eBay Motors is considered a leader in the online automotive auction industry. It operates just like the eBay and buyers can use filters to pick the wanted vehicle.
Salvage Bid: The dealers or individual buyers who are in search of extremely affordable used vehicles should visit Salvage Bid. It grants the free membership to users but to join live bidding buyers must have a premium membership that costs $200.
Purple Wave: an incredible place where bidders can access a variety of vehicles including trucks, tractors, cars and trailers etc. This auction forum doesn’t ask for any advance charges for bidding but only get 10% of purchase after the deal. However, if you try to bid for $10,000 or more, you would have to provide them with a guarantee letter from your bank.
IAAI: another a good online auto auction platform that offers free bidding service to licensed dealers. Nevertheless, if a bidder doesn’t have a license, then he/she will have to pay annual charges of $200 and can only participate in public auctions.
Buy Used Cars from Police Impound Auctions
Police impound auctions are a type of government auction where police and other state or federal law enforcement agencies sell their impounded vehicles and also drug seizure cars.
Buyers in police impound auctions has increased tremendously in the United States because of the internet. At these auctions, it is easy to get a vehicle at 20% to 70% of its retail market value.
What Cars are Sold in Police impound Auctions?
People think that police impounded automobiles are the vehicles of the murderers or the property of drug dealers – that is not always the case. In fact, the seized cars that are for sale at police impound auctions could also be the property of companies which are involved in frauds or have become bankrupt, etc.
Fortunately, these seized cars are available in decent condition — although some will need some bodywork. Likewise, the main goal of law enforcement agencies to organize such auctions is to recover a reasonable amount of money; that’s why they don’t care a lot about prices.
Police auctions don’t allow the buyers to take a test drive or even inspect the cars in person at all before the purchase so that is a potential drawback of these kind of sales.
How to Find Police Impound Auto Auctions?
The agencies like FBI, local Sheriff or DEA that hold such auctions give ads in local newspapers. To find police impound auction advertisements, buyers should read the ‘legal notice’ section of the paper.
Similarly, police seized vehicles auction listings are also available at auction listing sites. To receive regular updates about seized automobile auctions, it is better to obtain the membership of corresponding websites.
Gov-Auctions is considered a reliable auction listing platform in this regard. On the contrary, few law enforcement agencies also hire third-parties to sell impounded cars into different kinds of auto sales.
How to Participate in Police Seized Car Auctions?
Indeed, participation in police held sell-offs is not arduous. First of all, you need to figure out the location and timings of the police auctions from the relevant listing site or newspaper.
Otherwise, it is also a good idea to call at the nearby police station to get exact details. Then, bidders need to register themselves to attend police held sales. Hopefully, related authorities will guide you further.
Things to Consider While Buying Vehicles from Auto Auctions for Exportation
Buying pre-owned vehicles from auto auctions could save a lot of money especially if you are buying them with the purpose to sell overseas. To fulfil this task wisely, you must consider the following things while bargaining vehicles at sell-offs.
Research The Cars You Are Interested in Buying EXTENSIVELY
Bidding without doing your homework at auto auctions is not going to benefit you at all. That’s why it is vital to conduct proper research in advance to know the exact value of your desired vehicles.
To avoid overbidding and making incorrect buying decisions, Kelly Blue Book, local classified listings and Edmunds will assist you. Without regard to, Kelly Blue Book only tells the retail prices in favor of auto dealers and to explore wholesale prices; you will have to be armed with exact information especially if you are attending a public or police seized auto auction the first time.
In both public and government auctions, most of the time bidders only have to do a visual inspection because auction employees will not allow any sort of test drive. Here are a few basic things I always like to examine when inspecting auction cars for sale:
- Always start a car to know whether it starts without any delay or not.
- Check the oil to examine the engine value. If oil is milky brown, the head gasket has blown. The clean tan oil refers to the normality, and black oil tells about the bad maintenance history of the vehicle.
- Pay attention to the vehicle’s idle speed. Irregular speeds can indicate issues with engine sensors or much worse.
- Be careful with automobiles that emit frazzle smoke because it is a symptom of a bad engine. Unless you are willing to repair the engine and the it is cheap enough.
- Try to check the automatic transmission by putting it into drive to know either it is working smoothly or not.
- Pull the transmission fluid dipsticks, and look for bits of shaved metal or engine coolant mixed in with the oil. These are signs that it will need engine repair.
Check the VIN
VIN refers to the vehicle identification number and before finalizing any bid at a car auction, you must verify the VIN. This identification number is usually imprinted on several places of the car – typically, the easiest way you can see it is where the dashboard joins the windshield on the driver’s side.
If you find a vehicle with different VINs at different locations on the car, this means there may have been some major bodywork done and you should keep this in mind when bidding on the vehicle.
Be Careful With “As Is”
Usually, vehicles are sold at auctions with the condition of “as is”. This “as is” means there is no guarantee, warranty or legal option to make any claim against seller once you finalize the deal. This is quite common at car auctions but is something important to keep in mind.
In this world of digital currencies, it sounds ridiculous to bring cash to auto auctions but you will have to accept that cash is still king in the auction industry. It will be a significant setback if you lose any excellent vehicle because of lack of cash funds.
At least carry enough to leave a cash deposit on a vehicle after winning the bid. You may then go and retrieve the rest of the balance.
Whether you are participating in a public auction, dealer auction, or a government auction, arriving early would always be beneficial. It will allow you ample time to inspect the vehicles before bidding and to familiarize yourself with the auction’s rules and procedures.
How to Export Used Vehicles from the United States?
Exporting a used vehicle from the United States to any other country sounds difficult, but with proper documentation and by following legal obligations, I have found it not that bad at all. Honestly, I have most of my issues exporting cars on the other in, at the arrival port.
All auto exporters of used or new vehicles must comply with the regulations of United States Customs and Border Protection under the Code of Federal Regulations at 19 CFR 192 et seq to trade abroad. These provisions further define the operations for clearing customs and necessary paperwork.
What Documentation Is Required?
Complete all necessary paperwork before exporting used vehicle overseas. I have assistants to help out, but you will likely be handling this yourself in the beginning.
First of all, the automobile must have a product identification number (PIN) or VIN because US Customs wouldn’t permit the exportation of the motor in the absence of this number according to Section 192.2.
As it is about the exportation of used cars; therefore, CPB demands a ‘Certificate of Title or a Salvage Title’ from the vehicle owner. So, you must have the original or verified copy of the Certificate of Title.
I also highly advise to carry more than two copies as prevention. Keep in mind that you will have to hand over the certified copy of Certificate of Title to relevant CBP officials before the 72 hours of the departure of your automobile. It doesn’t matter if the vehicle is traded abroad via air cargo or shipment.
You should also ask the port director about the location of the port where they will look over your vehicle and documentation.
Foreign Companies or Non-U.S. Residents
If you are running an overseas company or not a resident of the United States then you will have to follow these additional steps subsequently described documentation requirements:
Non-U.S. resident needs to hire and empower a U.S. broker to list export data to AES from his side because foreigners can’t file export information to the Automated Export System (AES).
Then you will need to handover all required data including your overseas passport number to your authorized broker.
Access the Internal Transaction Number (ITN) from your hired broker or agent.
Hire an Automotive Shipping Company
It is also essential to hire an international car shipping company which will deliver your vehicle in the other country. Online reviews, expert advice and surveys would help the exporters in the selection of right shipping firm.
Shipping Options and Carrier Types
The person who is selling used auctioned vehicles abroad must ask the desired shipping option and trailer types from the foreign buyer.
Door-to-door Shipping Service: If your customer is willing to get the car at nearest desired destination in abroad then it is the fair choice. Although it is an expensive service.
Terminal-to-terminal Shipping Service: If you are selling cars in bulk or to a car dealer then this shipping service is preferred.
Enclosed and Open Auto Transportation Trailers: Carriers matter a lot to take care of the car whether you are shipping it via vessel, train or cargo. Open auto trailers are considered cheap, but they are unable to provide proper protection to the vehicle. That’s why if you are shipping luxury cars then you should go with enclosed auto trailers.
The main reason I wanted to share this with you is to provide a complete guideline about buying used cars and trucks from different kinds of auto auctions in the US and for exporting/reselling. I know from my years bidding in these auto auctions how exciting and fulfilling they can be.
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Last updated on September 20th, 2023 at 06:20 am