Mark Litsey of Taos, N.M., was three hours away from signing the papers for a Volvo 770 from a dealer in North Carolina. The truck had been on an auction site, but had not sold, so Mark called the dealership and talked them down to $62,000.
Mark’s brother Chris was eating breakfast when he stumbled across an almost-identical truck on hookup.com. The truck had more bells and whistles, and the bidding was at only $50,000, ending about lunchtime. Why not get more truck for less money? At five minutes before closing, Mark put in his bid and got the truck for $55,100 – almost $7,000 less than what he almost spent on a lesser truck. “I cannot believe I have this nice a truck for my first truck,” Mark says. “It is worth about $73,000, and the previous owner took such good care of it that everybody thinks it’s brand new. They even kept the plastic on the carpet in the back.”
Mark Litsey, one of the 6,500 registered users shopping on hookup.com, is one of the growing number of owner-operators who have dived into online auctions. About 28 percent of hookup.com users are owner-operators.
“Auction” usually brings up images of junk, but with the astounding success of eBay and other online auction sites, more people are becoming sold on the idea of buying and selling things online. Even eBay, known mostly for collectibles such as Elvis rugs and Dale Earnhardt cups, has had more than 100 Class 8 trucks listed at one time. Class 8 trucks are becoming more of a norm on online auctions, and some websites specialize in heavy trucks. Even with the oversupply of used trucks on dealer lots, the number of heavy trucks bought through online auctions has risen in the past few months.
Hookup.com, which specializes in trucks, trailers and construction equipment, had an all-time high number of bidders in January. Hookup.com averages about 700 live auctions daily, and it’s had as many as 1,900 live auctions going on at one time.
TradeOut, www.tradeout.com, is an online auction site for Class 8 trucks and other consumer goods, including apparel and toys. From its launch in July 2000 to December 2000, the commercial transportation group sold more than $20 million in trucks, tractors, trailers and containers, making it the company’s most profitable and fastest growing unit.
“The biggest advantage of online auctions is that you have a vast supply of equipment across many different sources,” says Henry Popplewell, vice president of commercial transportation for TradeOut. “If you go to a dealer, you are limited to that dealer’s inventory.” On TradeOut’s site, you can look at the inventory of many dealers and private sellers all in one place.
Some truckers are leery about doing business and giving out personal information on the Internet. “I’ll compare prices online, but I’m not going to give credit card numbers or other numbers over the Internet,” says Bill Vanhauvart, an owner-operator from Florida.
The fact that you can’t kick the tires through a computer also keeps away a lot of owner-operators, whose business depends on the reliability of their trucks. “I don’t think I would buy a truck through an online auction because I don’t trust those pictures. Looks are deceiving,” says owner-operator Thomas Fowler of Jackson, Miss.
Hookup is also trying to protect sellers from bidders who aren’t serious about buying. “We make sure that only prequalified buyers are bidding,” Vance says. “When someone starts bidding, hookup does a credit check. If the bidder is denied, customer service will call the buyer and the seller.”
How it works
Most auction sites let you browse without registering. To bid, however, you have to register.
When you find something you like, you enter a proxy bid, which is the most that you will pay for the truck. If someone else already bid on that item, their bid will increase until it is higher than your highest bid or until yours is the highest bid. You won’t necessarily have to pay the full price of your highest bid, but this way you don’t have to keep checking to see if someone outbid you. Most online auction sites will e-mail you if someone outbids you.
You can e-mail the seller if you have questions about the truck, and most sites have a feedback forum where previous buyers leave comments about their auction experiences.
Once time runs out, the sale is final. The seller should contact you within a few days of the closing to discuss payment and delivery options.
Most auction sites have a return clause stating that if the buyer discovers the description of the item was not accurate, he can return it to the seller. “The buyer has 10 days after the close of the auction to physically inspect the item to make sure it was represented correctly,” Vance says. “And buyers have the option to get it inspected before they bid.”
Paying for your purchase
Payment options include credit card, debit card, personal check, cashier’s check, money order, cash on delivery and escrow services. Make sure you know what forms of payment the seller accepts.
You might want to get prequalification before shopping. “When we prequalify a customer for a certain dollar figure, we want to be sure that the equipment supports that figure,” says Lander Gilyard, operations manager in CitiCapital’s e-commerce group. “Just because he’s qualified doesn’t mean he can buy whatever he wants. We won’t finance anything older than a 1995 unit.”
Hookup.com requires sellers to use one of its partners, Taylor & Martin Escrow Service, in any transaction. An escrow service accepts payment from the buyer via check, money order or credit card. The service releases the money to the seller only after the buyer receives and approves the merchandise. Using an escrow service can delay the deal.
Litsey was approved through a bank for the first Volvo. “So I called the loan officer to ask him if I could bid on this truck online,” he says. “He said no, so Chris asked why we couldn’t get a better truck for less money. The guy couldn’t argue with him, and we got a letter of credit in case we had to prove that we had financing.”
Credit cards also offer buyers and sellers protection, but sellers usually require payment by cashier’s check or money order before delivery.
More than you’ll ever know
While hookup.com and TradeOut are some of the more prominent online commercial truck auctions, there are several sites out there if you don’t find what you’re looking for.
EBay has a commercial trucks section. And bLiquid.com also sells commercial trucks, even though its main focus is on heavy equipment. There are other sites that may have only a few trucks, but one of those few may be your dream truck, and with the less popular sites, you probably won’t have to fight with another bidder over a truck. It’s just a matter of doing your research and knowing what you want, which is no different than if you were buying a truck from a dealer or another owner-operator.
Selling through an online auction
With so many used trucks out there for sale, an online auction can offer an advantage over traditional methods.
“You can reach an unbelievable amount of people,” says Greg Harrison of Camden, Ark., who, with his wife, Cindy, sold their Volvo 770 to Mark and Chris Litsey through hookup.com. The Harrisons advertised their truck in traditional media, but they needed to sell it quickly, and someone recommended hookup.com. “We put the truck in papers and talked to dealers, but they all told us how bad the market was,” Greg says. “But the Internet reaches out so far that you’re going to hook somebody.”
Some people may be intimidated by the computer aspect of the online auction, but it’s simple, the Harrisons say. “All we had to do was sit back and answer questions from buyers. It was easier than I dreamed it being,” Greg says.
“I took the pictures here and sent them to hookup and let them put them online,” Cindy says. “They led me step by step through the process.”
Putting a truck up for sale on most auction sites usually costs a posting fee and a commission. “I think we paid a $50 posting fee and a small commission,” Greg says. The most hookup.com charges for fees is $1,800.
When trying to sell a truck online, you can do a few things to make sure you hook someone. “Hookup encouraged me to post all of the specs and include pictures,” Greg says. “That helps to solicit people’s attention and interest.”
Make sure your description includes all information about warranties, specs, previous damage and work done on the truck. Also include many pictures from different angles so the buyer knows exactly what he is buying. “We provide sellers the ability to enter more than 75 specifications and unlimited photos,” says hookup’s Bob Vance.
Vance also says a catchy title, pictures of inspection and maintenance records and a reasonable price are important. “Another reassurance to the buyer is to supply inspection results. It may cost the seller $250 to $300, but it can be an extra selling tool, and it may get someone to buy who didn’t want to go through getting the inspection done himself,” Vance says.
- Listen to your intuition. If it seems too good to be true, it probably is.
- Research. Know the approximate value of the truck you are bidding on and read any feedback that other people have left about the buyer.
- Understand the auction. Make sure you know how the auction works before you start bidding.
- Know your limit. Figure exactly how much you can spend and stick to that number.
- Stick to one truck. If you bid on more than one truck and you are the highest bidder on both auctions, you are responsible for buying both trucks.
- Ask questions. E-mail the seller and ask lots of questions about the truck.
- Protect your privacy. Don’t give out personal identifying information, such as your Social Security number or bank account information, to a seller. No seller should need it.
- Appeal if necessary. If there are problems and you can’t work them out with the seller, contact the auction site.
Sources for used truck values
The Truck Blue Book (800) 654-6776, annual subscription with quarterly editions $120.
The True Value Guide (800) 654-8280, www.taylorandmartin.com, semiannual edition $16 and annual subscription with monthly updates $195.
The Official Truck Guide (800) 544-6232, annual subscription with bimonthly updates $90.