Vehicle auction companies see better realisations Chennai flood hit cars

| Thursday, February 11, 2016 - 15:46
First Published |
Car pool

Insurance cos initially expected 33-35 percent of the insured value for effected cars

Chennai: The curtains on the Auto Expo 2016 at Greater Noida might have come down, but a different kind of auto-expo is on near here where flood hit cars are kept for inspection and sale.
The online vehicle auction companies are happy as they claim to see better realisations from the sale of Chennai flood hit cars, said a senior official of online auto market place CarTrade.
The Chennai floods have impacted more than 80,000 vehicles with nearly 20,000 vehicles being declared "beyond repair" and urgently require assistance with disposal, he added.
"We have been auctioning cars now for more than six years during which a lot has changed. Most importantly, the adoption of the auction product both from buyers and sellers, have taken this business to a new scale," Ravi Mehra, president-auctions, told IANS.
"The recent Chennai flood affected stock too bears testament to this, as we are witnessing a steady rise in realizable values. Non local bidders from across the country are taking part in huge numbers and unlocking better values," Mehra said.
According to him more than 3,000 Chennai flood affected vehicles were auctioned in the last 45 days and currently close to 400 vehicles are auctioned every week.
He said in their yard auction recently, couple of cars were sold close to 90 percent of their insured value.
"We auctioned over 300 luxury segment cars. The costliest car listed with us till date is Jaguar F Type which has an on road price of around Rs.2.25 crore. We realized close to 43 percent of its IDV (insured declared value or insured value)," Mehra said.
He said insurance companies initially expected at least 33-35 percent of the insured value for the Chennai flood effected cars.
"However given the huge demand these vehicles have garnered from bidders from across the country, we have successful delivered values which are substantially higher," he said.
According to him, the company has rented couple of yards near Chennai to house the flood hit cars.
These yards currently auction close to over 200 vehicles every week. Bidders have physical access to cars during the yard auction, Mehra said.
Many outstation buyers have now identified local yards in Chennai to safely warehouse cars that they have procured in the auctions, he added.
He said the company has a tie-up with every major insurance company. It offers end-to-end services including parking, towing and basic refurbishment facilities for all assets in its parking lots. It has the largest on-ground support team to facilitate a smooth transaction between consumers and buyers.
On the company's revenue stream Mehra said for auctions the clients are manufacturers, banks, insurance and leasing companies and CarTrade gets paid from both sellers and buyers.
However the four public sector insurers seem to have kept themselves away from the online auction process.
"We did get offers from online auctioneers. But we found their procedure bit cumbersome. We settle the claims net of salvage. The vehicle owner/insured decides the mode of disposing his car," a senior official of a government owned public sector company told IANS preferring anonymity.
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