Buying vehicles at online auctions

In the last couple of years I’ve bid on at least 5 different online auction sites and purchased cars on 3 of those. Here is my experience.


Ebay

I bought a car from Ebay Motors in February 2020.


Research

  • Auctions are up for days so plenty of time to research the VIN
  • You can ask the seller questions privately
  • The pictures are often limited and not of great quality
  • There isn’t much transparency in terms of the listing – there are no standards in terms of what a seller must include or not include in their description.
  • There is no chat or commenting system with input from other enthusiasts

Bidding Process

  • Proxy Bidding – You enter the most you’re willing to pay. Ebay will automatically bid for you to the highest amount not exceeding your max bid. If your max bid is higher than the next highest max bid, the price will immediately jump to just over the next highest max bid. If your max bid is not the highest, it’ll be bid up to over your max bid.
  • No deposit is required to bid

Winning

  • It is my understanding that even if you win the bid you aren’t actually obligated to complete the transaction although most sellers demand some form of down-payment immediately following the auction. This could allow a purchase inspection to complete before agreeing to complete the transaction.
  • In my case I bought a car less than 100 miles away so went to see it in person
  • You’re buying from an individual yet Ebay didn’t have any kind of assistance for purchasing like an Escrow service. I tried to convince seller to use escrow.com but he refused. I ended up wiring the money which meant the seller had both my funds and the vehicle before he released it to me, which made me very nervous and then of course you need the seller to transfer the title.
  • If I were to do this again I’d insist on using an escrow service. It looks like since 2020 Ebay has partnered more deeply with escrow.com

Taking Delivery

  • It is between you and the seller to arrange shipping. In my case I purchased Hagerty insurance then immediately used their free towing since the vehicle was close by

BAT or Cars and Bids

I bought a car from BAT in November 2021. I have not bought a car from C&B. However they are so similar, I’ll group them together.

In the listing for the car I bought a number of flaws were mentioned. However, there were a significant number of additional flaws that were never mentioned. Radio doesn’t work, some parts of digital dash don’t work, power antenna doesn’t work, broken window moulding. Fuel gauge was described as “intermittent” but it is basically non-functional. Smokers car, no key for the t-tops. Shows the risks of purchasing basically sight unseen. Photos can hide a lot.

Research

  • Auctions are up for at least a week so allows as much time as you need to research the VIN, ask questions and review other commenters feedback
  • There are typically hundreds of photos and often videos posted
  • On BAT for popular cars there are typically very knowledgeable commenters on the thread
  • I like the fact on Cars & Bids there is a “Known Flaws” section. BAT doesn’t have this and any flaws are either mentioned in the narrative – or in fact not at all.

Bidding

  • Neither site uses proxy bidding. The amount you bid is exactly the amount the sales prices jumps to. You of course have to place a bid higher than the current bid.
  • Both sites take a deposit on your first bid
  • Down to the final 2 minutes, each new bid resets the clock to 2 minutes to prevent sniping

Winning

  • When you win, negotiating the payment, title and delivery is between you and the private seller
  • BAT sends an email with a receipt for the buyers fee
  • I asked the seller to send a photo of the title then wired the money
  • He put the title in the mail and sent me a tracking number

Delivery

  • BAT provides a handy shipping quote option. I found the quotes to be cost-competitive with shipper on U-Ship however… it said that pickup would be within 10-14 days which seems awfully long. Most shippers pick up between 3 and 5 days.
  • The seller ended up providing a shipper who charged two-thirds of BAT

Costs

  • A 5% buyers fee is charged and a hold is placed on Credit Card as soon as you bid

GAA Auctions

I bid on some cars on GAA but have never purchased. Some key points:

  • GAA out-sources actually bidding process to a system called Proxibid.
  • Proxibid has a ton of features, even though the design isn’t that modern
  • You can place a proxy bid in advance of any auction. It shows the current high bid just like Ebay
  • Cars are only sold when they roll across the auction block and there is live bidding
  • You can watch the live stream of bidding, although in one case this failed to work. Its unclear what the audio/video lag is
  • Like every auction other than BAT and C&B, opportunities to research are very limited, listings are sparse

Mecum

I bought a car from Mecum Chicago 2021 online.

https://www.mecum.com/lots/CH1021-468807/1965-ford-f100-pickup/

The hammer price was $12,000 but they add the 10% buyers commission when the quote the sales price – although online I had to pay 12% which was not reflected in the price.

Its a bit of an odd truck – looks pretty straight but claims to have a 327 CI engine which if true means someone swapped in a Chevy engine. From research, it has a New Process 435 manual transmission which seems to bolt up to almost anything, so this all seems plausible. I’m curious to learn what era the 327 came from.

I used classic.com to research this vehicle and found it may have been sold at auction in 2014, 2015 and online in 2019. If the 2014 link is correct, that listing claimed a 390 CI engine and a “Recent restoration”. The 2015 sales doesn’t mention the engine size. The potential 2019 sale (determined by the date at which the walkaround video was uploaded to Youtube) also doesn’t mention this.

Research

  • From a research perspective, listings on Mecum offer _very_ few details, not even a VIN until close to the auction. In my case there was no VIN until they posted a walk-around video something like 8 hours before the auction and I had to transcribe the VIN from the video
  • There is zero opportunity to ask clarifying questions and obviously no commenting or feedback
  • So unless you’re present at the auction and have had a chance to personally view the vehicle, from an online perspective you basically buying sight-unseen (or at least only seeing a handful of pictures of varying quality and one un-narrated walkaround video)

Bidding

  • You can enter a proxy bid for the most you’re willing to pay and Mecum will bid for you to that amount. Similar to Ebay. That is how I won my auction. Unlike GAA, Mecum does not show other people’s proxy bids, only your top bid, but its not really an issue since being the top proxy bidder doesn’t really have much of a bearing on the auction itself.
  • Cars are only sold when they roll across the auction block and there is live bidding
  • You can also manually bid if you didn’t provide a proxy bid or if it has been exceeded
  • The Mecum bidding page allows you to watch the bidding video stream live and follow-along in the bidding process and manually bid. On a desktop browser, there is very little lag. I’d strongly recommend watching the live stream for auctions you’re bidding on on desktop only, not mobile, where there is likely to be a ton of lag.
  • It is super fast-paced and does fairly well transition between in-person bids and internet bids
  • As far as I can tell you can only bid online with the next ask prices the auctioneer sets. For example if a vehicle is bid to $20k, the next price to bid online might be $22k, you cannot offer $21k for example

Winning

  • Once you’ve won there is no way to initiate payment online, you have to wait for them to send an invoice.
  • The invoice is payable immediately upon receipt. Included the hammer price, the 12% buyers fee, an $85 other fee (some kind of documentation, I think) and Tax at 6.25% which is Illinois used car tax
  • You are paying Mecum directly. I set up a wire but since I did so on a Saturday, it would take until Monday to clear

Delivery

  • Mecum require vehicles to be picked up by 3pm Monday. I used U-ship to generate transportation bids. Bids were in the $1200-$1600 range to ship Open Transport from Illinois to California. But almost no-one could commit to picking up in that small time window only in a multi-day range. Having had a bad experience in the past, and given that I would be traveling on vacation Monday, it felt like a lot could go wrong here trying to organize a shipper to pick up in a very narrow time window.
  • I requested a quote from Mecum’s Auto Transport service. They quoted $3,000 for a closed transport option. Unfortunately they had no cheaper open transport option. However, the kicker here is they take care of everything. I ended up going this route because I would not be available to deal with coordination of an external shipper.
  • I paid by credit card and they charged me an 3.5% fee for $105 🙁
  • Good news is immediately upon payment I get a link to a shipment tracker, so its all good to go
  • They told me it would take 10 to 14 days to arrive, which seems like a lot longer than other shippers but since I’m on vacation for a week, that actually works for me

Update on shipping

  • Reviewing the online tracker, it wasn’t picked up until Wednesday
  • I got a call on the Friday (6 days later) that the truck would be delivered Monday
  • I then got a call on Saturday (next day) that the truck had broken down
  • I spoke to the driver Monday and he said he’d need another couple of days to figure out how to get it to me
  • I think it was Thursday by the time they got it on another truck
  • Truck was delivered Saturday (a full 2 weeks after purchase)

Costs

  • To register with Mecum Chicago 2021 it cost me $200. There is a more expensive option that seems geared to people in-person
  • That gave me a bidding allowance of $50k without having to do any funds verification.
  • It gives you access to some different views, one of which is just a giant list of all the auction lots that update in realtime as they are bid and won.
  • It gives you access to the live auction page and a non-delayed video stream (unregistered video streams are delayed 30 seconds)
  • I was watching the auction but thought the price had exceeded my proxy bid, but when I heard the auctioneer say sold on the internet for $12k, I realize I had won.
  • Internet buyers pay a 12% commission on winning bids. When they update the sold prices on their listing, they include the commission.

Summary

  • Auction Registration – $200
  • Hammer price: $12,000
  • Internet buyers fee of 12%: $1,440
  • Doc fee: $85
  • CA Sales Tax is going to be $980.56 (of which I already paid 6.25% to IL)
  • Shipping: $3k
  • Shipping CC charge: $105
  • CA Title & Reg: Unknown
  • So my $12k auction purchase actually cost me $17,700 to buy, ship and pay taxes. Ooof.

Lessons learned:

  • Mentally add 12% to your final price for your purchase cost
  • Note that shipping will add a significant chunk to the costs especially since using Mecum’s closed transport option seems like the only hassle-free way to do this. So consider purchasing from much closer auctions, or if you’re buying a driver, be prepared to pick it up yourself and drive it off – but recognizing this won’t be until the first business day following the auction if you’re wiring money. Presumably if you write a check-in person or drop a bag of cash you can take it immediately.

Summary

  • Ebay is proxy bidding only, free to bid and a transaction between private parties
    • Up to you to title / register at your DMV, pay taxes etc.
  • BAT and Cars and Bids are live bidding only, refundable deposit to bid and a transaction between private parties
    • Up to you to title / register at your DMV, pay taxes etc.
  • GAA and Mecum are proxy bidding plus live bidding.
    • Mecum charges $200 to “enter” the auction; Mecum charges 12% and purchase transaction is between you and Mecum and so they will withhold local tax that you can credit against your own state’s tac

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