Online auto marketplace Bring a Trailer closes the year with $1.35 billion in sales

1977 Datsun 280Z 4 speed

Courtesy: Kahn Media

Online auto marketplace Bring a Trailer expects to close the year with record sales of $1.35 billion as a new generation of collectors log on to shop for classic and used cars.

Randy Nonnenberg, Bring a Trailer co-founder and president, told CNBC that annual sales were up 63% from 2021, when sales hit $829 million.

The San Francisco-based company’s website has made it easy for collectors to buy and sell cars online, and during the Covid pandemic has attracted a flood of young car dealers selling everything from seven-figure Ferraris to $60,000 Corvettes and $15,000 -Saabs sold.

The question now is whether the car collecting frenzy triggered by the pandemic will persist in a recession. Nonnenberg said he sees no signs of the company’s business slowing down.

“The big challenge we have is to meet all the demand,” he said.

While Bring a Trailer, which was acquired by Hearst Autos in 2020, has disrupted the traditional business of buying and selling collector cars, traditional classic car auction companies like Mecum, RM Sotheby’s and Gooding & Co. have also had strong years in 2022. Hagerty, the classic car insurance company, also got into the auction business, buying Broad Arrow and launching Hagerty Marketplace, an online sales platform.

2017 Ferrari LaFerrari Aperta

Courtesy: Kahn Media

Rising interest rates, recession fears and rising auto inventories have started to put pressure on used car prices and demand. Nonnenberg said some car prices have fallen, with the average selling price falling slightly in the second half of 2022.

However, he said Bring a Trailer’s business model – which is based on low-cost, easy-to-use and efficient car buying and selling – could benefit from a downturn. Sellers pay a flat fee of $99 while the buyer’s fee is 5% on top of the final selling price, capped at $5,000. This is far less expensive than traditional auctions or many dealers.

“There will continue to be horse trading,” said Nonnenberg. “If people have had their car for three or four years and want something different or their financial situation suddenly changes and they have six cars and want to sell two, that’s still good for our business model.”

1986 Porsche 944 Turbo

Courtesy: Kahn Media

Bring a Trailer’s growth this year has been fueled by higher sales and vehicle values. Up to 700 cars were sold each week and the average value of cars sold was $54,495, up from $47,500 in 2021.

That year, 145 cars sold for more than $500,000, up 172% from 2021 as the company attracted wealthier buyers and sellers. A 2017 Ferrari LaFerrari Aperta sold for $5.36 million in May was the most expensive car ever sold.

In addition to growing sales volume, Bring a Trailer wants to expand its community of collectors and car enthusiasts. It has over 900,000 registered users and about 413,000 registered bidders. It also plans to hold more in-person events and is working with partners in local markets to expand services for buyers and sellers, Nonnenberg said.

For 2023, Nonnenberg said the big goal is to use improved technology to reduce wait times for cars to be listed. It now takes an average of 26 days between submitting a car for listing and going live on the site, and Nonnenberg said: “We want that to be reduced to 10 days, that’s the noble goal.”

2000 Saab 9-3 Viggen

Courtesy: Kahn Media

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