The business of auto transport is a relatively simple process but for financial institutions, there are complexities that other sectors don’t experience. “Our lending customers share frustrations regarding the speed of vehicle pickups and deliveries, moving inoperable vehicles and finding reliable auto transporters who can work with repo yards, dealers and auction houses,” states David Sutton, Vice President of Business Development at Montway Auto Transport.
Interesting industry facts:
- Americans had $1.4 trillion in auto loan debt in 2022, according to an Experian study. This represents a 6% increase since 2021.
- Nearly 84% of new cars had financing in 2022, according to Statista
- Members of Generation X are the most likely to have multiple auto loans
- Gen Xers are the most likely generation to have car loans, at 59%
- Electric and hybrid vehicle financing has doubled in four years
- 2.2 million vehicles are repossessed every year, the top three being Ford F-150, Chevy Silverado and Honda Civic
Considering the latest statistics, challenges for lenders aren’t going away. This article will cover the basics of auto transport and what to look for in a provider to simplify your operation and expedite transactions.
Types of auto shippers
There are many different types of auto shippers available to hire to move vehicles between locations such as repo yards, auctions or dealerships.
Local or private car haulers. These smaller, independent companies are usually owner operators that only cover specific routes or regions. You’ll speak directly to the driver who is most likely the owner of the truck and trailer. While direct access is convenient, routes and availability are often limited. Private car haulers run their businesses differently, so don’t expect contracts or references to review.
Auto transport carriers. These companies are larger versions of private car haulers. They own the assets, employ their own drivers and handle the pickup, transport and delivery of vehicles to and from most locations, although many only operate in certain areas. While carriers are regulated by the Department of Transportation and Motor Carrier rules, reliability and expertise can vary among companies.
Auto transport brokers: A broker is a licensed expert in the industry and has access to a large network of carriers serving multiple areas across the country. Working with the right broker gives clients a single point of contact for all units and access to tools and technology to improve efficiency, reduce costs and provide transparency. Brokers also verify the USDOT authority, federal licenses and cargo insurance of the carrier company transporting the vehicles to ensure cars are transported by a legitimate carrier.
Challenges transporting off-lease or repossessed vehicles
Every vehicle transport is unique. Even when the auto transporter has the VIN and knows where the vehicle is located, the information isn’t always one hundred percent accurate. “We’ve had drivers pull into a repo lot to pick up a vehicle described as in good working condition only to find the front quarter panel crushed and blocking the tire,” Sutton recalls. It’s important to have the most accurate data possible. Not only does it ensure the right driver and equipment, but it also makes the loading process go more smoothly.
Repo lots also have strict appointment times that have to be met but also obstacle-ridden locations that may make maneuvering in the lot impossible. There are instances where a driver can’t even enter the yard and instead must park outside and find a way to push or tow each vehicle to the trailer for loading.
Transporting damaged or inoperable vehicles
For a vehicle to be considered operable, it must be able to drive forward and reverse under its own power and steer. If any of these conditions are not met it is considered inoperable. Basically, if a car can be driven on and off a transport truck with no additional work on the part of the driver then it’s an operable vehicle.
When a vehicle is inoperable due to being in an accident, it’s helpful to know exactly where the damage is on the vehicle to ensure the proper equipment is available when transporting. Some vehicles may require a forklift to move them from the ground to a trailer while others may be able to be loaded with a winch.
Some vehicles look fully intact but have mechanical issues that make them unable inoperable. Should the transporter expect loose parts? Leaking fluids? A locked steering wheel? Knowing these specifics in advance allows the driver to have all the equipment on hand to speed up the loading. Not all transport trucks can accommodate inoperable vehicles so pickup may take longer for an inoperable vehicle.
Auto transport to and from auctions and dealers
Reliable, safe and timely vehicle pickup and delivery is always the goal but navigating specific hours of operation, security measures and other regulations do come into play. Timing is critical for both physical and online auctions; drivers must be on time and follow an auction’s regulations, gate pass procedures and vehicle location strategy.
When moving vehicles to and from dealerships, drivers must accommodate a location’s hours of operation and follow any specific procedures. To plan for customer demand and properly manage their inventories, both auctions and dealers often transport single vehicles instead of waiting to fill a trailer.
How to find a reputable auto transport partner
Leveraging the right auto transport partner can reduce days-to-sale to maximize revenue and eliminate the frustrations of working with multiple carriers. To evaluate your current auto transporter or research new options, be sure to consider:
- The company’s claims rate, including the average response time and resolution if damage occurs
- Technology integration options with consignor remarketing systems and/or customer portals for order automation and transparency
- Coverage map and on-demand capacity when needed
- Pricing and operational efficiency, including average pickup times
- Ability to move a single unit as well as full-loads
- Reputation in the industry and with customers
Vehicles are depreciating assets and delays in transportation to the auction or the purchasing dealer may represent $25 to $40 per day in carrying cost. “Lenders are looking for a balance among transportation speed, reliability, security and cost to the person paying the transport bill,” concludes Sutton.
Keep your remarketed vehicles moving
Montway Auto Transport has the experience to help banks and credit unions with all their vehicle transportation needs, from the return of off-lease vehicles to repossessions. We have an extensive and vetted carrier network to dispatch trained drivers to move any vehicle, running or inoperable, anywhere in the country. We can arrange transport for one car or an entire vehicle fleet from the repo yard or storage lot to the auto auction facility or dealership in a timely and efficient manner. To learn more about Montway’s industry experience, visit our website or call 888-998-4161.
