Okay – so this answer looks simple – it is an auction where many car dealers both sell cars and buy cars. How does this work? Easy. Say you drive a five year old Toyota Camry but are going to trade it in for a big upgrade – lets say a Mercedes. You trade in your car and drive home with your new Mercedes but now the Mercedes dealer has a Toyota Camry to sell. A Camry really does not fit into the Mercedes cachet and the dealer probably doesnt want the Camry on his lot. People who go to browse at a Mercedes dealer are not looking for a used Camry.
The Mercedes dealer will then offer up the Camry for auction along with cars from other dealers to create the pool of cars that make up a Dealer Auto Auction. So now we have the inventory for the dealer auto auction so next we need the buyers. The typical buyer at a dealer auto auction might be local used car dealer. They are looking for inventory for there lot and these auctions are one great place to go.
The cars available at a dealer auto auction generally go for less then their blue book value and if the cars available do not need any work a dealer could make anywhere from $ 500 to $ 3000 per car. The key is to know what you are doing. These auctions can be fast and furious – there are no test drives or returns. The cars are sold as-is. Do not assume these cars are all clunkers though – good cars can be found but do not expect them to slide by – they will be bid on and the profit margin on one of these "cream puffs" may only be a few hundred dollars.
Who can go to a Dealer Auto Auction? Depends on where you live. Most auctions are for licensed dealers only but this is not always the case. You will need to do some research to find out where and when they are you can try asking a dealer. Remember dealer auto auctions are not government auctions, insurance auctions and repo auctions which are all readily available to the public. People often confuse these auctions or think that they are all the same which they are not. Again – you can get access to these auctions you just have to do your homework – at sites such as