The auctioneer’s hammer at the car auction selling block might soon be used to hammer nails in the coffin of traditional “tent” car auctions. Sure, Mecum Auctions posted over $275 million in sales at its 2024 Kissimmee, Fla., auction from over 4,300 vehicles offered for sale. Last year, Barrett-Jackson’s first fall auction in Scottsdale, Ariz., even posted over $200 million in sales. Despite these numbers, traditional car auctions under a tent might soon be a relic.
Traditional Car Auctions
Auction houses have been around for ages and usually auction more than just vehicles, though our focus here is on their automotive auctions specifically. Most auction companies host a few on-site, live auctions scattered across the country yearly.
Barrett-Jackson held three auctions in 2024 and will soon kick off its season in Arizona, with roughly 1,900 vehicles crossing the auction block. Mecum will host 10 auctions in the U.S. this year and kick off its 2025 sales in Kissimmee.
So, why exactly do I think in-person car auctions are dinosaurs breathing their last breaths?
The Demise of Car Auctions: Online Competition
In 2020, COVID caused many car auctions to postpone or cancel their live auctions. Some companies reverted to online sales with some success, and the crowds and buyers have started to flock back to the auctions.
However, more online car auction sites have sprouted up in the past few years and gained popularity. And some sites are becoming increasingly selective with their listings — these are not daily drivers that you might find on Craigslist. Some sites focus on specific brands and marques, while others are broader in scope.
Car Auction Trends
Bring a Trailer, for example, was successful in 2024, with over 30,000+ vehicles exchanging hands. On a typical day, nearly 700 vehicles and automobilia are up for grabs.
The co-founder of Bring a Trailer, Randy Nonnenberg, attributes the site’s success to the variety of cars offered, often at a reasonable price, with “something for everyone.” They have sold nearly 120,000 vehicles and automobilia in the last 5 years.
Hagerty, a classic car insurance company, notes that for 2024, “the numbers of cars offered online more than doubled that of live auctions.” Plus, in 2024, the actual online sales amount surpassed the value sold by the live auctions.
Ironically, Hagerty owns Broad Arrow Auctions, which sold over 400 cars during three live auctions in 2024. The firm also sold 86 cars in “private sales.” Hagerty also started its online site Marketplace in 2022, with nearly 1,200 listings currently available.
In 2021, Barrett-Jackson bought ClassicCars.com and developed a spin-off, AutoHunter.com. Craig Jackson, CEO of Barrett-Jackson, noted, “You’ve got to be in the middle of it.”
Arizona Auction Week has been a big deal for decades and is held in January each year. In 2018, seven auction companies were on site for 20 days of sales. In 2025, only four auction companies will have 12 days of auctions. Gooding & Company — now owned by Christie’s — and Worldwide Auctioneers, which held auctions in Arizona last year, bowed out from this year’s offerings.
5 Reasons Live Auctions Are Declining
1. Commissions
Traditional auction houses charge the winning bidder an additional fee, known as a buyer’s premium. This is generally about 10% of the winning bid.
Recently, many auction houses have raised their buyer’s premium to 12% on the first $250,000 of a purchase price and then 10% on any additional bid price. Often, the premium is even higher for overseas sales or automobilia. So, if a car sold for $100,000, the buyer would have to pay a fee to the auction house of an additional $10,000+ before taking possession of the car.
Most auction houses also deduct a seller’s fee, typically 10%, from the sale price. So, if the car sold for $100,000, the seller would only receive $90,000.
In the example above, the auction house would receive about $20,000+ for its services in selling the vehicle for $100,000.
By comparison, most online auction sites charge a single flat fee to the seller, typically $0-250, with 100% of the vehicle sale price going to the seller. Online auction sites typically charge 4.5-7.2% of the winning bid to the buyer and cap this buyer fee at around $4,500-7,500.
The online auction fee structure presents a much more monetarily friendly program than traditional live auctions for both buyers and sellers, especially on high-value vehicles.
2. Timing
While auctions are held nearly year-round, sellers who want to work with one auction house are limited to a few weekends when live auction sales are held.
If a buyer wants to place a bid at a nearby auction, they may only have one yearly auction to choose from. Additionally, a buyer will have to wait until that auction house offers up a car they want. So, the opportunity to buy from a traditional auction house is generally limited.
Online car auction sales, on the other hand, offer cars continuously. On any day, thousands of cars are listed on online auction sites. Sellers might need to wait only a few weeks before their car is listed for sale, and most auctions last only a week. Meanwhile, buyers can specify what vehicle(s) they seek and register to get notified when an online listing matches their selections.
3. Transaction Costs
With an online auction, after the site collects its fees, the buyer and seller work out the final purchase process. The buyer must contact their state directly for any related sales tax and registration fees.
In comparison, some on-site auctions might take 30 days to pay out the seller. However, most traditional auction houses will collect a state sales tax unless the buyer is a licensed car dealer or proves the car is leaving the state where the sale was made. Those out-of-state transports are still generally reported to the buyer’s home state revenue department.
4. Transportation & Travel Costs
For in-person auctions, sellers must pay to transport their vehicles to the site. Those costs can easily exceed $2,500. If the seller decides to attend the auction to answer questions and promote their car, they will incur additional travel costs.
With an online sale, a seller has no trailering fees and can answer questions from home. They are also more readily available if they need to review their files or maintenance records. Generally, the buyer is responsible for arranging pickup or transportation after an online auction closes.
5. Community
There is no denying a traditional car auction involves lots of players and plenty of drama. Attendees will comment about the car on the auction block and urge higher bids. Seeing two rivals raising their bids for a car is exciting — and expensive.
Most online car auction sites allow members to log on, make comments, or ask questions about the cars on sale. Bring a Trailer’s Randy Nonnenberg notes that his site promotes “accessibility” to car auctions and attracts a younger, affluent audience.
The online community is very knowledgeable about the cars and can point out discrepancies in the car’s description or ask specific questions. All of these comments are available for all to see and review.
Most online sites mandate many pictures showing the car and any existing defects. Some sites display over 200 detailed photos for close inspection. Videos of a cold start and a cruise in the neighborhood are the new expectations on these sites. At some traditional auctions, the seller/owner is not even on-site, and potential buyers rely on some vague description in the catalog and a brief visual inspection on-site.
Car Auctions: The Online Future
To demonstrate the breadth of online auto auctions, here are some cars that were successfully sold recently:
- 2018 Porsche 911 GT2 sold for $593,000 (Bring a Trailer)
- 2011 Lotus Elise R sold for $60,500 (Cars & Bids)
- 1948 Ford Pilot sold for $30,137 (Collecting Cars)
- 1952 Chevy Pickup sold for $20,330 (Hagerty Marketplace)
- 1968 Chevy Camaro sold for $50,750 (Auto Hunter)
- 1956 Ford F-100 sold for $39,375 (Hemmings)
- 1995 Toyota Land Cruiser Prado sold for $15,000 (PCar Market)
- 2013 Mercedes Benz SL65 AMG sold for $66,000 (MB Marketplace)
Most traditional auction houses are starting online sites to supplement their dwindling on-site auctions. Barrett-Jackson’s Craig Jackson acknowledged that “the internet is bringing many people in” to the collector car arena.
But, will an online presence help increase interest in the collector car market for these traditional auction houses? Which auction houses can survive the shift and stay in the market while developing a strong online presence? Big online-only car auction sites like Bring a Trailer, Cars & Bids, and Collecting Cars already have a big head start.
