How ADESA will conquer Europe
As we reported earlier, CarsOnTheWeb is now called ADESA Europe. But there’s more to it than just a name-change. This could be the start of a big shake-up of Europe’s Remarketing landscape. Let’s dive behind the headlines with the two top execs who will be doing the shaking.
Based in Carmel, Indiana (US), KAR Auction Services, Inc. (KAR) has a presence in 75 countries worldwide, but most of its vehicle auction and remarketing business (more than 75 corporate and auction sites and 11,000 of its 15,000 employees worldwide) are in North America (US, Canada and Mexico).
3.4 million vehicles
Last year, the automotive marketplaces that make up the KAR Auction Services group sold more than 3.4 million vehicles for a total value of more than $40 (€35.4) billion, generating $2.44 (€2.16) billion in revenue. More than half the transactions are executed online. In recent years, the group has been bringing to bear its size and expertise in Europe.
In mid-2015, KAR acquired HBC Vehicle Services, a salvage vehicle auctions specialist located near London. In 2016 KAR acquired GRS Remarketing, an online whole car auction company located in Chester. The latter company was renamed ‘ADESA UK’, after the KAR brand that provides wholesale vehicle auction solutions to professional car buyers and sellers in North America. KAR’s first foothold in Europe was tasked with bringing the parent company’s remarketing capabilities to the UK.
KAR’s next major foray in Europe was finalised in January 31 of this year, with the acquisition of Belgium-based CarsOnTheWeb (COTW). A robust online wholesale vehicle auction marketplace, COTW – now ADESA Europe - connects OEMs, fleet owners, wholesalers and dealers in more than 50 countries, mainly in continental Europe.
Cross-border sales
With 95% of its transactions involving cross-border sales, ADESA Europe stakes its claim as the continent’s leading international remarketing platform. It has sales operations in Belgium, France, Germany, Italy, the Netherlands and Spain (now renamed ‘ADESA Belgium’, etc.), providing sellers in those countries (and buyers across Europe) with auction, transport and related support services.
KAR’s moves, first into the UK and now into Europe, are part of a well-considered master plan, says Benjamin Skuy (pictured, top), KAR’s Executive VP of International Markets and Strategic Initiatives: “KAR wants to expand internationally into countries where our business model – our brands, our technological tools – can flourish. After starting with the UK, we now move into continental Europe.”
“Both ADESA UK and ADESA Europe will remain distinct companies with their own qualities. What was interesting about COTW is their expertise in online, cross-border auctions. For us, that’s a sound basis for future expansion.” Technology will be one lever for that expansion, says Mr Skuy: “We will be introducing common use of new technology. For example, in the next few months, we’ll launch a self-inspection tool powered by artificial intelligence, both at ADESA UK and ADESA Europe. This is the first of its kind.”
New customers
For ADESA Europe, the message to the market is twofold: yes, expansion and innovation on the one hand; but also continuity on the other, says Johan Meyssen (pictured, below), CEO of COTW – and now of ADESA Europe. “Our management team stays on board, as do our country managers. For our existing customers, it’s business as usual – but, over the coming months and years, with the addition of extra tools and services.”
The aim is also to build on the existing open-source service model and attract new customer segments with additional business models. For buyers, this will mean even more cars to choose from.
“Meanwhile, it’s great to be part of the KAR Auction Services family, as this opens doors to commercial relations which currently exist in North America and the UK. Like Jonathan Holland, (Managing Director of ADESA UK.), I’ll report to Benjamin, and I intend to make full use of his knowledge and expertise.”
Volume opportunity
“We have significant aspirations for the European market – bigger than COTW could have managed on its own,” Mr Skuy adds. “At its core, KAR is an open remarketer, the biggest provider of private-label auctions in North America. In Europe, we sense a huge volume opportunity that we will explore with ADESA Europe.”
“But we will also look into offering additional services. The European Remarketing Association CARA has identified cross-border logistics as a major problem in the further development of remarketing in a European context, and rightly so. We intend to bring the logistics solutions we use in North America over to Europe.”
“Apart from the self-inspection tool we’ll be introducing shortly, we’re also looking white label solutions, dealer financing, logistics solutions as mentioned, and expanding our GW Liste dealer-to-dealer model.”
“Watch out”
ADESA Europe will also be considering other European markets besides the six where it is already present. No names or dates yet, but it will be “where there are significant business opportunities in dealing with leasing companies, dealer networks and other potential client groups”.
From logistics and dealer financing to the introduction of new tools and technologies and strong relationships with OEMs and other customer groups, KAR’s support for ADESA Europe only points in one direction.
“Everything we will do will be with the intention of driving ADESA Europe’s online remarketing business across Europe. Watch out for a lot more happening in the year to come,” Mr Skuy concludes.
