Lifting the hood on a used car auction
This story was produced by our colleagues at the BBC.
The rapid patter of the auctioneer and the thud of a gavel — the classic sounds of an auction. Today, 250 cars are being sold at Manheim Leeds in the north of England. It’s part of Atlanta’s Cox Enterprises and is one of the U.K.’s busiest car auctions.
If you’ve ever wondered what happens to old rental cars or where your car goes at the end of the finance period, there’s a good chance it ends up at auctions like Manheim Leeds.
Out in the yard, it’s a fresh spring morning. Cars arrive by truck and undergo a rigorous process before hitting the auction floor: cleaning, inspection and grading.
In the main building is Manheim’s expansive warehouse. Lined neatly across the floor are gleaming cars waiting their turn to be driven down to the double-lane auction floor. Here, I catch up with Sunny Bhatt, who runs SRH Cars in Leeds. He’s eyeing up premium German vehicles.
“We’re kind of looking at the mileage,” explains Sunny, “so as long as it’s not too heavy on the miles. Preferably under eight years old. You’d be hoping to pay around about £8,000-£9,000.”
That’s about $11,000, and, according to another player — British Car Auctions — the U.K.’s used car market is going strong. The average selling price was $10,500 in January, up 6% from the year before. Sunny explains that we have electric vehicles to thank for that.
“It’s a supply-and-demand issue. There’s a massive influx of electric cars,” he said. “So a lot of the auctions have less and less petrol and diesel cars, which will drive the price up.”
By “petrol and diesel,” Sunny means gas cars. And despite this influx of EVs into the market, Sunny says, for now, he’s not interested. “I’d rather stick to the petrol and diesel cars that we know, love — and can fix.”
Standing behind the auctioneer’s platform, I can see the screens flashing: numbers and bids coming in from online buyers watching a live stream of the auction.
Matt Scholes from RHT Motors is taking a break. He comes to Manheim every week and always has a strategy.
“I do a lot of pre-work before I get here,” Scholes says. “I’ve managed to buy three out of six. Paid a little more than I would’ve wanted for two of them but I’ve got to set a ceiling before I start to bid or it can get out of hand.”
After greeting all the regulars on the auction floor, center manager Ben Musther gets me to go shoulder-to-shoulder with the other bidders.
“So we’re on lot number 496,” he says. “This is a Mitsubishi Shogun, and it’s done 130,000 miles. It’s got an auction guide price of about £2,000 to £2,450.”
He darts me a glance. “Where do you think it’s probably gonna end up?”
“I’d say £2,000,” I tell him, slightly uncertain.
“I don’t think you’re a million miles away,” says Musther. “I think that’s gonna probably do £1,700 to £1,800. Nobody’s putting their hand up just yet.”
“I better keep my hand down,” I say, only half-joking.
“We’re alright. We’re trained professionals,” quips Ben before turning his attention to business.
“So he’s now asking for £1,800, the internet’s flashed up there, £1,900. So that’s now on provisional.”
“That’s it? It’s done?”
“That vehicle’s offered and out the door.”
I’m proud of my guess, telling Ben, “I wasn’t far off.”
Professional pride kicks in. “You wasn’t”, he says, “but I did mention £1,800 to £2,000!”
Okay, so Ben wins this one. It’s clear that here at Manheim Leeds, the used car market remains strong and always moving.