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4th Autoremarketing Forum India 2017

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Zach Hallowell's presentation at the 4th Autoremarketing Forum in India 2017

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4th Autoremarketing Forum India 2017

  1. 1. MANAGING WHOLESALE VEHICLES IN A DATA WORLD Information is the oil of the 21st century, and analytics is the combustion engine. - Peter Sondergaard Gartner Research
  2. 2. RMS AUTOMOTIVE – ZACH HALLOWELL, GM • General Manager of RMS Automotive • Directs overall global activities of RMS to ensure optimum efficiency and productivity to maximize growth, profitability and customer satisfaction. • Extensive experience in the global wholesale automotive industry, having spent 15+ years developing and evolving Wholesale Automotive SaaS platforms • Named inventor of numerous patents related to vehicle lifecycle management, electronic marketplaces and third party vehicle inspection processes. • Graduate of Middlebury College, Major in Political Science
  3. 3. ABOUT COX AUTOMOTIVE
  4. 4. 42017 Cox Automotive, Inc. Confidential & Proprietary COX AUTOMOTIVE SCALE Vehicle Values Sold Annually through Manheim $51B+ Unique Visitors Monthly on 13,000+ Dealer Websites 47.7M+ Source: 2015 Dealer.com internal reporting January - Dec 2015 3 of 4 Cars Sold in the US & Canada Source: Dealertrack internal reporting, Q2 2015 Touching Source: Manheim Financial Reporting, 2015 50,000+ 73% Of All US Car Buyers Source: 2016 Car Buyer Journey Study, IHS Polk Use Autotrader or KBB.com (Wholesale & retail dealers, OEMs) Source: FP&A July 2014–July 2015 Dealer Clients Across 6 Continents GLOBAL DMS CLIENTS COUNTRIES90+ 3.8M+ Monthly Service Appointments Source: 2016 Xtime internal reporting Xtime 2016 Monthly Average 30,000+ Source: Cox Automotive Internal Reporting, October 2015 Team Members Globally Financed Titles Managed By Dealertrack 46M+ Source: Dealertrack Internal Reporting, Q4 2015 A leading provider of products and services that connect the automotive ecosystem worldwide
  5. 5. COX AUTOMOTIVE ORGANIZATIONAL STRUCTURE RETAIL SOLUTIONS MEDIA SOLUTIONS FINANCIAL SOLUTIONS INVENTORY SOLUTIONS INTERNATIONAL
  6. 6. OUR FOCUS EVOLVE STREAMLINE SIMPLIFY WHOLESALE RETAIL Inventory Management, Sourcing and Disposition Floor Planning & Business Administration REVOLUTIONIZE Shopping With A Connected Consumer Experience Ownership and Service Experience
  7. 7. RMS AUTOMOTIVE OVERVIEW • RMS Automotive is a key strategic partner to Global OEMs, Captives and other large vehicle portfolio owners, providing vibrant marketplaces, transparency and insights to optimize clients’ portfolio values • We offer technology to manage the complete vehicle lifecycle, from new car build to used car sale. Through automation and data science we help our clients maximize returns and reduce risk 3.5M+ VEHICLES PROCESSED 850K+ VEHICLES SOLD 40+ CURRENCIES HANDLED 30+ LANGUAGES SUPPORTED
  8. 8. WHAT WE DO 3RD PARTY DATA • VIN decoding • Vehicle history reports • Peer retail sales and lease maturities CONSIGNOR DATA • Build data • Original sale (lease, loan, cash, rental) • Non-Cox wholesale transactions Vehicle Stages Plan & Order Build & Sale In-Service Pre-term Return Remarket Re-retail Vehicle Lifecycle Product Modules Vehicle Origination Vehicle In-Service Vehicle Pre-Term Vehicle Return Vehicle Remarketing Rapid Retail Vehicle Order RMS Automotive Solution Data Driven Decisioning Insights Optimization WHOLESALE • Supply/demand, transaction prices • Valuation – past, present, future Retail • Supply/demand, list prices • Valuation – past, present, future (through Analytics Hub)
  9. 9. TRENDS WE WATCH WHOLESALE INVENTORY TIDAL WAVE ABOUT TO HIT DIGITAL RETAILING COMING FAST AND FURIOUS MARGIN COMPRESSION AFFECTING EVERY DEALER OPEN PLATFORMS BECOMING TECHNOLOGY OF CHOICE MEDIA LANDSCAPE CHANGING RAPIDLY
  10. 10. MANAGING WHOLESALE VEHICLES IN A DATA WORLD The Wholesale Market Challenge in the US
  11. 11. FUTURE VOLUMES INFRASTRUCTURE CANNOT HANDLE VOLUMES +4mm All time high new vehicle leases in 2015 +17.5mm All time high new vehicle sales in 2015 32% New car lease penetration & growing Need to go further upstream in vehicle lifecycle Increase online market share Rise in Leasing Global Platform 4.6M3.6M+ 3.1 M
  12. 12. EXAMPLE – GROWTH IN ONE CLIENT’S LEASE MATURITIES 0 5,000 10,000 15,000 20,000 25,000 30,000 Jan Feb Mar April May Jun Jul Aug Sep Oct Nov Dec Maturiteis Monthly Lease Maturities 2016 2017 2018 55% Growth
  13. 13. How do we solve this structural problem?
  14. 14. DATA SCIENCE DRIVING DECISIONS IN THE USED CAR BUSINESS Intuition Based Decision Making is a Guessing Game Data Driven Insights + Intuition = Perfect Blend Golden Gut Outcome(s) Data Science + Analytics Intuition
  15. 15. RMS AUTOMOTIVE – DATA OPTIMIZATION GOALS Set the right price In the right channels To the right buyers With the right recon
  16. 16. REMARKETING TODAY VS. FUTURE SEPARATE DECISIONS • Location • Recon • Pricing HOLISTIC DECISIONS • Channel, Location, Recon, Pricing • Right dealers to target with marketing Downstream ON-LINE Upstream CLOSED Upstream OPEN Grounding DEALER Downstream IN-LANE Upstream Downstream RMS VISION FOR FUTURE CURRENT CASCADING PROCESS Grounding DEALER OPTIMIZATION Pricing Channel Location Recon
  17. 17. OPTIMIZATION Set vehicle floor price by adjusting for: • Content • Color • Location • Condition • Carfax • Supply & demand Recommend reconditioning based on: • Recon costs • Expected sale price lift • Business objectives Recommend pull-ahead(s) based on: • Residual values • Forecast supply & demand • Forecast sale price Determine best channel or auction given: • Projected price • Transport costs • Depreciation • Supply & demand • Business constraints Find dealers that meet your vehicle needs based on: • Dealer buying activity (e.g. purchases, bids, searches) • Dealer inventory • Retail supply & demand Channel Optimization Recon Optimization Pull Ahead Optimization AutoMatch Optimization Pricing Optimization
  18. 18. HOW CLIENTS ARE USING DATA AND ANALYTICS TO IMPROVE THE REMARKETING PROCESS RMS Floor price Japanese OEM Non-Captive 200 100 0 92.7% 93.3% 0 200 100 99.8% 100.1% 0 100 200 43.4%42.9% 100 200 0 101.1% 101.6% Japanese OEM Sell-through (Sold/Offered) Japanese OEM Retention (Sale price/MMR) Non-Captive Sell-through (Sold/Offered) Non-Captive Retention (Sale price/MMR)
  19. 19. • Reach clarity on critical decisions • Creatively use new sources of data • Use analytics to assess options and estimate value • Make Data-Driven Decisions • Quickly source and experiment with new data • Monitor results and adjust decision making The sophistication to … The combination of Data with Insights and Optimization DISRUPTING REMARKETING THROUGH DATA Businesses make thousands of decisions a day. Most are routine. Velocity Depreciation VIN Specific Remarketing Disrupting
  20. 20. RMS AUTOMOTIVE Transacting vehicles in multiple countries and growing, RMS Automotive, a Cox Automotive Brand, delivers a global enterprise software solution that enables its commercial clients to manage their portfolios across the complete vehicle lifecycle – from new car build to used car sale. Through automation and data science, RMS Automotive provides VIN-specific recommendations for accurate vehicle pricing as well as optimal reconditioning and inventory distribution. These services deliver real-time integration with a client’s platform, faster remarketing time, reduced depreciation/cost of capital, improved residuals, and reduction in wholesale losses. For more information about RMS Automotive, visit www.rmsautomotive.com or http://rmsautomotive.eu/

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