Introduction
When you look at Online Auto Auctions on the App Store, you will find that the vast majority of them focus on used cars. The world of auto auctions, both online and in-person, is built around selling vehicles that have a past. These can be cars from a wide range of places, including repossessions, off-lease vehicles, cars from rental fleets, and even damaged or salvaged vehicles from insurance companies.
These auctions aim to give buyers, especially car dealers, a way to buy a large number of used cars at wholesale prices. For a private buyer, it’s a way to find a deal that you might not get from a regular dealership.
The Focus is on Used Cars
Most big and well-known auction apps, such as Copart and IAAI, are almost exclusively for used cars. These apps specialize in vehicles with clean titles as well as those with salvage titles (which means they have been in a major accident or damaged). They list thousands of used cars every day.
You will find a huge variety of used vehicles on these apps:
- Dealer Consignments: These are used cars that dealers want to sell quickly to make space for new inventory.
- Bank Repossessions: Cars taken back by banks because the owner stopped making payments.
- Fleet Vehicles: Used cars that come from companies with large vehicle fleets, like rental car agencies.
- Salvage and Damaged Cars: These are vehicles that have been in accidents, damaged by hail or floods, or stolen and recovered. They are sold for parts or for someone to fix up and resell.
The reason you see so many used cars is that that’s what an auction is best for. A new car has a set value from the factory, and dealers are the ones who sell them to the public at that price. There is no need for an auction to decide the price of a brand-new car.
Why You Won’t Find New Cars at Auction
New cars are rarely sold through these kinds of auctions for several key reasons:
- Dealer Agreements: Car manufacturers have contracts with dealerships that say how and where new cars can be sold. These contracts do not allow new cars to be sold at public auctions.
- Fixed Pricing: A new car has a set Manufacturer’s Suggested Retail Price (MSRP). While dealers can offer small discounts, the starting price is not something that is up for bid. Auctions are about letting the market decide the price, which doesn’t fit with new car sales.
- Warranty: New cars come with a full factory warranty. Used cars sold at auction are almost always sold “as is,” meaning there is no warranty.
So, while a few very rare, special cars might be sold at high-end auctions for collectors (often not on a public app), for the most part, Online Auto Auctions on the App Store are all about used cars. If you are looking for a brand-new car, your best bet is a traditional dealership or an online car-buying service that specializes in new vehicles, not an auction app.
