KAR Auction Services is boosting its investment in its TradeRev business as it seeks to spread the online appraisal and auction tool to as many as 100 markets across North America and eventually take it global.
This story by Amy Wilson originally appeared in Automotive News Canada.
Through a mobile app or a desktop tool, TradeRev lets dealerships sell wholesale vehicles to other dealerships in real time.
In the second quarter, 30,000 vehicles were sold through TradeRev, more than double the year-earlier period, KAR said this month. It’s in just more than 30 markets in the U.S. and Canada. The company is ramping up its spending on TradeRev in the second half of this year, adding staffers and expanding marketing and branding efforts. The number of dealers using the platform is growing, though KAR isn’t disclosing how many are signed up.
TradeRev had 200 employees in North America as of last October. It is now up to about 430 with almost 150 openings to fill.
For 2018, KAR plans a loss of $40 million before interest, taxes, depreciation and amortization from TradeRev, which is part of its ADESA auction unit. That’s a bigger loss than initially planned because of more investment coming in the second half of the year. The company’s overall 2018 spending on TradeRev is more than $40 million, though, because gross profit on the vehicles sold through TradeRev is also being reinvested in the business.