It’s no secret that the
keys to selling your collector vehicle at auction are research, preparation
and presentation. It requires only a small time commitment on your part to
maximize your vehicle’s sale probability at auction.
For starters, you
must research and come to understand the actual auction process. First
find an auction that offers cars similar to your own. Why? It’s more
likely that it will attract buyers that will be interested in your car,
too. Next, investigate the policies, procedures and fees of your potential
auction companies. You’ll likely be charged both an entry fee and a
commission on the sale, which vary from company to company. Premium run
times (when your car crosses the block) will likely bring an extra charge,
too. Early and late time slots generally have fewer people in the audience
to bid on your car, so the the extra cost is often worthwhile. Finally,
find out when and how you will be paid if the car is sold. Try to find
collectors that have already been through the process, and ask questions
about their experience with the process and the auction company, and if they
were satisfied with their service. Above all, ask them if the auction
company met their obligations as spelled out in their consignment contract.
Unfortunately, in the world of big time auctions the small time
enthusiast/collector does not always receive the service promised, leaving
him/her with little practical recourse.
Next, you need to
determine the value of your car. Not your own pie-in-the sky value, or the
price one was reported to have sold for at a high profile auction, but a
realistic price based on multiple auction sales, comparable classified ad
listings and multiple price guide sources. An important component of this
is that you properly evaluate the condition of your car. We’ve talked to
countless hobbyists who think they’ve got a priceless jewel, when in fact
it’s a gem only to them. It’s imperative that you’re honest with yourself
during this process and arrive at an accurate value.
From this, set your lowest
acceptable value, or the lowest price that you will sell your car for. This
number should be a bit below your reserve, as it will allow you some
negotiating room if bidding gets close to reserve and you move to post-block
negotiating with one or more bidders.
Now that you’ve determined
your price, decide how you will enter your car. Will it go through at a set
reserve, or are you willing to roll the dice and go no reserve? As a no
reserve entry, the vehicle will sell to the highest bidder, regardless of
price. There are ways around this, such as buying back the car (known as
“buybacks”) to avoid letting the car go at too low a price. If you go that
route, you’ll also have to pay the buyers fee, making the whole thing
nothing more than a costly exercise. Because you are both the seller and a
bidder buybacks enter an ethical gray area, but it is a fairly common
practice. With a set reserve, you tell the auction company the minimum bid
that you will accept. If that number isn’t reached, you take the car back
home. Often, the auction company offers a lower entry fee to vehicles
consigned on a no-reserve basis. They’re willing to give up a little up
front knowing that they’re guaranteed adding a buyer’s fee to their total
revenue on the vehicle. Keep in mind that some auctions are all no reserve,
so the reserve option is not available.
The paperwork involved in
entering you car in an auction can get confusing for the first time
consignors. Rest assured, however, the auction company has this all down to
a science and will guide you through it every step of the way. You’ll have
to fill out and sign a consignment form. The first thing you’ll need to do
is prove ownership, so you’ll need your title. If there is a lien on the
car, it gets a little messy. Check beforehand with the auction company, as
many of them do not accept consignments with liens.
The consignment process is
where you’ll have an opportunity to describe your car. Give detailed
information such as history, restoration work, recent work or service, any
awards it has won, and any other information that will make it stand out
from the other vehicles in the auction. If it runs and drives well, state
it – often this is exactly what buyers are looking for. Be honest and open
about what the vehicle is and reveal any flaws or problems. If you don’t do
this, it can (and often does) come back to you after the sale. Depending on
the auction companies’ policy, this could take the form of refusal to
release payment, legal action, arbitration, or other action that is far more
of a hassle than it’s worth. Plus, it’s just wrong.
One of the most important
things to do has nothing to do with the auction at all. Spend a day
cleaning and detailing your vehicle. Clean everything. Inside, wipe down
the seats, door panels and dash (get all the gauges, knobs and switches),
vacuum the carpet, and try to remove any stains. Underhood and underneath,
remove as much dirt and grime as possible, but only so much as makes sense.
For example, if the rest of your car is in #3 condition, don’t spend an
inordinate amount of time trying to bring these areas above that.
Conversely, if your body and interior are spotless, it’s a good idea to make
the rest of your car that way, too. Lastly, give it a fresh coat of wax.
Mechanically, try to replace or repair anything that detracts from its
presentation. A faulty exhaust or fluid leaks are two examples. Make the
vehicle run as well as possible. If it needs a tune up, give it one. Make
sure the battery is ready to go, too. When it’s your turn to drive up to
the block, you want to make the best impression possible. Spending several
hours sprucing up your car will show prospective buyers that the car has
been well cared for. It’s also quite possible that you can raise the
condition rating of your car at least half a grade, and several hundred to a
few thousand dollars in value. It’s time well spent!
Number assigned by the auction company to registered bidders
Block: Area where the vehicle is displayed while bids are
Caller: The auctioneer calling bids from the podium.
Chandelier bid: Often used term to describe a bid that wasn’t
real. “That bid came from the chandelier.”
House bid: A bid that is generated by the auction company to
open bidding or keep bidding going. A seller-friendly practice that is
Lot number: Number assigned by the auction company to be met
before the car will be sold
No reserve: vehicle sells to the highest bidder, no minimum bid
Phantom bidder: A bidder who doesn't exist still managing to
Post block: Action on the vehicle after it has crossed the
Reserve: A minum bid level set by the consignor and/or auction
company that must be met before the item can be sold.
Ring man: A key auction company employee who works the bidders,
communicating their bids and the staus of the bidder back to the
Supplying pictures of your
vehicle is critical. Now that your vehicle looks the best it can, take
several digital photographs inside and out. If your chassis is spotless,
take a picture of that, too. Along with a description of the vehicle, the
auction company will post these for you online well before the auction date,
and your vehicle will get many views through their website. If possible,
create a website specifically for your car and ask the auction company to
link to it in the online description of your car. It’s not difficult to do
and it gives you the opportunity to really showcase your vehicle.
Finally, auction day is
here. Go to the sign in area and let them know you are ready to go. If you
haven’t given them the title, do so now. If it is title exempt, they will
at least need the VIN. Have a complete understanding of their consignment
and sign in policies and requirements before you get there. Go to the
staging area early and get your car positioned and set up. Display any
trophies it may have won. It’s a good idea to display a “storyboard” of the
vehicle. This typically has a full description of the car, including copies
of any original documentation and any unique or special characteristics it
may possess. If you restored the car yourself and have pictures documenting
the process, bring them along, too. Lastly, it is very important to stay
with the car. You want to be there to answer questions and advocate for
your car. Show people around. Yes, many of the lookers will be just
that---lookers. But you’ll get a few serious potential buyers, too, and
what you say here could clinch a winning bid.
Once your car hits the
block and bidding starts, pay attention to the action. If your car sells,
great! If not, may still not be lost. If the bidding came close to the
reserve, often the auctioneer will ask you if you want to drop the reserve.
He will then try to jump start the bidding in order to get the price up.
Failing that, it will go to the current high bidder. Alternatively, the
auction company may close the bidding and then try to get you and the high
bidder (or others), to close the deal “post block”. Both of these
scenarios bring in the “lowest acceptable price” we talked about earlier.
Remember it and stick to it, as you arrived at that number in a clear headed
and calculated manner, not under the pressure of the auction atmosphere. If
your vehicle sells in this manner, you are still responsible for all auction
fees and commissions. Either way, stick around for a couple hours after the
sale. You may be summoned to answer a question from the buyer or auction
company, or there may be a glitch somewhere along the line. It’s better to
get everything settled while you are still there.
If your car doesn’t sell,
what you don’t want to do is try to negotiate a deal privately with
someone. You are still on the auction companies’ grounds and all the
potential buyers were brought there by the auction company. Besides being a
little slimy, it also violates your consignment agreement, which clearly
states that these types of sales (within a certain time period) are also
subject to all fees. Technically, even if you close a sale a week later in
your driveway you should notify the auction company.
None of this guarantees
that your vehicle will sell at the price you want. However, it does ensure
that you are maximizing the sales potential of your vehicle and greatly
increases the chance that you walk away happy with the collector car auction
Please take a moment to
fill out our
Auction Company Satisfaction
Survey. We will be
publishing results in August, 2012.