I know it keep the consumers out so the dealers can competes below the retail price but why would anyone who want their cars gone sell it at a place where everybody unwilling to pay retail price than just go to a public action and sell it to the consumers?
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Many dealer auctions are vehicles that have been in a Collision or have other problems and need work.
They may be branded Salvage and need to go through a rebuild process to be legally driven. Many are only good for parts.
Most dealer auctions are cars that should be sent to the scrap yard. The idea being dealers get them cheap, invest money fixing them, and then turn a profit selling them on to the public. If you let the regular public in they would over bid on the car and then have no money left for fixing it up. Thus leaving dangerous cars on the road. Source my family and I have owned dealerships in the past.
Mainly because the average person doesn’t understand the meaning of as-is or immediate payment required.
They come back later saying the car was in an accident, the transmission is shot or something expecting the auction lot to take it back. Or they bid and expect to pay with a credit card (that could later be charged back) or finance it (subject to approval).
Once you bid, the sale is final. You’re expected to pay via cashiers check that day and get it off the lot.
Since so many people don’t understand it when a car turns out bad, the auto lots don’t want any more inexperienced people.
I think you’re misunderstanding **who** is selling cars at these auctions. The cars that are sold at these auctions are most often from:
* insurance companies selling cars after accidents
* finance companies selling cars after repossession
* dealers selling cars they took in on trade
In all of these cases, the car is just a liability and they want it gone. For insurance and finance companies the car is likely damaged or in bad repair mechanically and they just want it gone. Also, those cars may have title issues that need to be worked through.
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