The Industry.
The auto market is an interconnected industry with a vast variety of players working together to facilitate the exchange of vehicles. It might not seem as complex to the consumer, but make no mistake.
Everything trickles down from your typical auto manufacture - the GMs & BMWs of the world. Outside these typical manufacturers there are remarketing agents, regulatory bodies, franchised dealers, and independent dealers. So who's what and what do they do?
The Head: Auto Manufacturers
The supply of all artifacts in the auto world originate from auto manufacturers. Testing new technologies, creating new paradigms, and mass-producing cars enables a global market which produces over 75 million cars per year.
The Heart: Remarketing agents
The remarketing agents are a fancy word for your typical car auction where players in the industry buy and sell wholesale inventory. Surprisingly, the wholesale auction environment plays the largest role in the industry. It is in essence the heart of the industry…..pumping cars in and out of the automobile system.
“True market value is determined with every vehicle that drives onto the auction block”
It provides a dynamic trading floor where competitive bidding is fast pace and true market value is determined. Auctions in the North American market are supplied with over 16 million used cars annually from dealers, commercial fleets, financial institutions, rental companies, and auto manufactures.
The Eyes: Regulatory Body
A regulatory body is put in place to ensure a fair & safe market. It is usually put in place by a government body to ensure consumers are protected. For example, within Canada each Province has it's own council. In Ontario, the Ontario Motor Vehicle Industry Council oversees the market and enforces the Motor Vehicle Dealers Act on behalf of the Ontario Government.
Dealers must obtain their licensing through the regulatory body and openly and honestly disclose adequate information. From contract writing, making mandatory disclosures, to how dealers advertise - the entire lifecycle is regulated.
The Backbone: Franchised Dealers
These are your dealer's who are authorized to sell brand new cars and sometimes operate several dealerships. They are granted permission through an extensive screening process to be given the privilege to sell brand new cars that come directly from the manufacturer. It is not uncommon for one franchised dealer to own multiple dealerships from different manufacturers.
The Feet: Independent Dealers
All the leg work in the industry is done by the independent dealers. They have the ability to sell new or used cars but due to the large financial requirements needed to operate a new car dealership - majority of these dealers only sell used cars. Their inventory is acquired from remarketing agents and through trade-ins. Currently in Ontario, Canada there are over 25,000 registered dealers.
Without the Auto Manufactures - there is no revolution, there is no new ideas, there is no invention of the auto - no industry.
Without the Remarketing Agents - there is no inventory, there is no trading ground - no thriving industry.
Without the Regulatory Body - there is no fair playing ground, there is no regulation - no safe industry.
Without the Franchised Dealers - there is no large supply being pushed to the masses - no organic industry.
Without the Independent Dealers - there is no adequate options for those who want something older or simply can't afford something new - no competitive industry.
