A US-based insurance firm; Insurance Auto Auction (IAA) has said that the company sells over 2.2million vehicles annually in North America alone.
The company said this last weekend in Lagos when the Vice President of Global Market Development at Insurance Auto Auction (IAA), Mr. Daniel Oscarson, appeared as a guest on Shipping Position Live.
He also said that people participate more in auctioning especially in US because the cost of repairing a damaged vehicles is higher than the cost of getting a new one, adding that a damaged car drops in value in the US.
He also said that it is easier to have the owner of such vehicles buy a new one to replace the damaged ones.
Oscarson said: “IAA is a car auction company in US, they sell high quality vehicles. We have vehicles from insurance companies, finance companies and other institutions that have large number of vehicles to sell. Each year in North America, we sell over 2.2million vehicles. There are lots of cars we sell on auction and the reason is that in the US, vehicles are very expensive and when they have any physical damage in form of accident, the cost of repair is also very expensive”
Explaining further, he added, “so, an expensive car in US that had accident will go down in value by the cost of repair in US dollars. It costs a lot to repair cars in US because the labour rate and costs of the parts are always very expensive. And so many times it is cheaper to replace the vehicles than to repair; also the repair cost can actually be more than the cost of the car. So in that case it is much easier to have the owner of the damaged car buy a replacement car and sell the damaged vehicles in an auction”.
Speaking on who owns the vehicles that are being sold through auction, he said that it is the insurance companies that own the vehicle which they must have paid the owner to get a new one before selling to the auctioneers.
He said that people desire American-made cars because of the numerous features in cars made-in-America
“The insurance company that insures accidents cars is the one that owns the car, after the accident happens they become the owner of the damaged car which they paid the price, so that the owner can go and replace their cars. They don’t want to own a damaged car they want to sell it and that is why auction comes to play. The vehicles come to us and we sell them on their behalf and we recover some of their expenses.’’
Speaking specifically on American cars, he explained that”, you know there are many places where you can buy vehicles; you can buy from different countries but the cars in US are very desirable around the world because of the things they come with. It comes with many things like automated transmission, air-conditioning and all that. So that is why cars from America are very desirable. But if you buy a car from US, there will be a discount because it has some damage on it, bring it here and repair it and at the end of the day you will have vehicles that have more features that what you wanted earlier”.
He also said that there are many benefits attached to buying cars through auctioning; it will not only create jobs for Nigerians but will also provide affordable transportation system for Nigerians who might not be able to afford new cars.
“There are so many benefits for anybody that wants to buy car through auction, it reduces taxes. But more importantly these used cars create a lot of jobs in the local markets. For the shipping and towing industry, mechanical repairs, electrical repairs, body works, upholsters amongst others. These areas create job for people in Nigeria, most importantly it creates affordable transportation system for people in Nigeria who might not be able to buy a new car”.
“We have online platform where people can be able to preview what they want to buy before the auction. They will be able to look at high definition of images of the damaged areas before they can buy. They can only pay for what they want and the prices are very affordable. There are many companies that can assist you with the transportation and shipping of the vehicles to Nigeria”, he concluded.
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