Quick answer: Automated vehicle pricing lets a dealership reprice inventory on a set schedule, based on its own pricing rules and market data, instead of relying on manual updates. Drive Point Auto Group says it cut its average days to sale from 42 to 21 after adopting it in vAuto. The system works in both directions, so prices can move up or down with the market. Managers can also opt any vehicle out.
Key takeaways
- Drive Point’s average days to sale dropped from 42 to 21 after adopting automated pricing in vAuto.
- Automation is built around each store’s own pricing philosophy, not a one-size-fits-all rule set.
- Pricing is bi-directional: it can raise a price to capture gross as well as lower it.
- Managers can opt any vehicle out and price it themselves.
- Faster turn also changed acquisition, with Drive Point buying cars at lower cost.
In a recent ASOTU Edge webinar, Josh Gonsenhauser, Senior Director of Business Development at vAuto, and Kyle Pisani, Dealer Principal and Partner at Drive Point Auto Group, talked through what happens when a group puts automated pricing to work. Watch the full conversation here or read the highlights.
What is automated vehicle pricing?
Automated vehicle pricing is software that reprices dealership inventory automatically, following rules the dealer sets. Those rules cover how long to retail a car before a wholesale or transfer decision, whether to start high or low, and which days to reprice. Every vehicle is priced from day one, so no unit waits for someone to get to it.
What results did Drive Point Auto Group see?
Drive Point cut its average days to sale from 42 to 21. “There’s no math that says if you sell a car in 21 days versus 42 that it’s not more profitable,” Kyle said. Holding costs, depreciation, and the incentive needed to move an aging unit all shrink as the days shrink, and a faster turn means more chances to make gross.
How does automated pricing work in vAuto?
vAuto’s approach is to automate your process, not impose a new one. Josh explained that the team starts by asking questions like:
- How many days do you retail a car before a wholesale or transfer decision?
- What is your pricing philosophy: start high or start low?
- Do you reprice on certain days and skip others?
From there, pricing decisions take into account market activity, CRM activity, conversion rates, and how similar vehicles sold on your lot in the past. Josh was clear that this is not a race to the bottom. The goal is to maximize gross on every unit.
Drive Point reprices on a set cadence, not every day, and tunes the approach store by store depending on whether the store is driven by gross or volume. Once a vehicle starts to age, the group gets aggressive quickly at every location.
Can pricing go up as well as down?
Yes. Automated pricing in vAuto is bi-directional. If the market moves up, a price can move up with it. This also corrects a common manual-pricing problem: a bad experience with one model can lead a manager to price the next one too low, and automation helps catch that. As Josh put it, “Nothing drives demand like a price.”
Do managers lose control of pricing?
No. The system is designed to handle the commodity part of the lot, not the vehicles your team knows best. Managers can opt out any unit, such as a lifted truck or a car with a rare trim, and price it themselves. They can also delay automation, for example by pricing manually for the first 7 days and opting in at day 8.
Josh described that expertise as the used car IP: “That’s the thing we’re not looking to take away.” Kyle said Drive Point’s used car managers were not hesitant. They were excited, because automation gave them time back for acquisition. Kyle estimates repricing takes 45 minutes to an hour and a half a day, and Josh said automation can remove 38 to 45 minutes of that daily work.
How does faster turn change acquisition?
Because Drive Point has a clearer picture of what a car will sell for and how fast, it is acquiring inventory at lower cost. Kyle pointed to lead conversion rates as a reason there is far less guessing: if you know how many leads it takes to sell a car, you can plan around it.
What’s next for automated pricing?
Josh expects more integration points and better predictions on when specific vehicles will sell. Kyle sees the full digital transaction as the next layer. Dealers should be thinking about what an online deal looks like and how to make it profitable.
How can dealers get started with automated pricing?
Start small. Josh said vAuto sees adoption of about 80 to 85 percent, and teams can begin with a portion of their inventory, see the results, and expand. The approach is to lean toward the customer, proving the process works before asking for more.
Talk to a vAuto representative about automated pricing →
Watch the full webinar on demand →
Frequently asked questions
Software that reprices dealership inventory automatically based on rules the dealer sets, such as retail timeframes, pricing philosophy, and repricing schedule.
No. In vAuto it is bi-directional, so prices can rise when the market supports it as well as fall.
Yes. Managers can opt any vehicle out of automation, or choose when a vehicle enters it.
Josh Gonsenhauser said automation can remove 38 to 45 minutes a day of repricing work, depending on the store and the person doing it.
Drive Point reports its average days to sale dropped from 42 to 21 after adopting automated pricing in vAuto.
