Use of the Internet in remarketing fleet vehicles, a shortage of those vehicles in good condition, and manufacturer retail rebates reflect the most significant changes and current trends in the industry, according to the annual National Associa-tion of Fleet Resale Dealers (NAFRD) Business Survey. The recently released 2004 survey canvassed NAFRD members on more than a dozen major industry indicators, from most popular exterior color to the most frequently used remarketing channels. In addition to providing key data to the industry, survey results are used to help NAFRD determine its future direction, growth, etc., according to Kim Glasscock, the organization’s executive director. In response to the question “What do you feel has been the most significant change in the fleet remarketing industry?” and the closely related “What do you feel has been the most significant industry trend?” over the past year, survey respondents detailed several aspects of vehicle shortages and Internet use. Specifically mentioned were the shortage of popular-model, low-mileage fleet units, a slow-down in fleet vehicle sup-plies, and the increasingly poor condition of lease turn-in units. The growing use of the Internet in fleet vehicle remarketing was cited as the top industry trend. Among the specifically noted changes in Internet features were increased availability and use of online auctions and pricing information and “the fleet company’s ability to research several auctions at the flick of a button to cross-check pricing.” “Loss of clients to auctions” was another significant change reported in the survey. Detailing the catalysts for this change, respondents listed “exclusive deals” between auctions and fleet leasing companies and the fleet leasing companies’ increased use of auctions. NAFRD members noted several other industry trends. Among them were dealership consolidation, diversification in used-vehicle disposal, employee sales, decreasing customer sources, fewer remarketing dealers with larger territories, more standard equipment, and upstream selling. Chart 1 Fleet management companies provided nearly half the vehicles sold by NAFRD members. Fleet management companies were the source of 45 percent of vehicles purchased by NAFRD members. (Chart 1.)Other sources included corporate fleets, 23 percent, and auctions, 13 percent. Accounting for the remaining sources were new-car dealers, daily rental, other NAFRD dealers, financial institutions, trade-in, and individuals. Survey respondents indicated the average period for vehicle pick-up was 3.5 business days from notification of availability. Chart 2 More than 80 percent of NAFRD remarketed vehicles were sold through retail, auction, or used-car dealer channels. Of the total estimated 114,800 vehicles remarketed by NAFRD members, 30 percent were sold in the retail market. (Chart 2.) Another 28 percent were disposed of at auction. Twenty-five percent were sold to used-car dealers, and 14 percent went to new-car dealers. Vehicles sold to other fleet resale dealers and those exported accounted for another 2 percent of the total. Less than 1 percent was sold through other channels, including eBay online. The Ford Taurus recorded the highest number of units sold, followed by the Chevrolet Impala, Pontiac Grand Prix, Dodge Caravan, and the Dodge Intrepid. Chart 3 reveals the average investment for mechanical reconditioning at the wholesale and retail markets: $223 and $408 respectively. The average investment in cosmetic reconditioning (paint and body work) was $183 for the wholesale market and $357 for vehicles in the retail market. Chart 3 The NAFRD survey revealed members' average investment in mechanical and cosmetic vehicle reconditioning. A diesel engine was the most valuable resale option on two-year-old vehicles. The engine recorded $1,655 in added value. Other option values ranged from $618 to $161. (Chart 4) Chart 4 According to the NAFRD survey, a diesel engine was the most valuable resales option on a two-year old vehicle. Finally, NAFRD members ranked the most popular-selling interior and exterior colors among remarketed fleet vehicles. White, silver metallic, red, and gray, scored highest for exterior color. White/tan, white/gray, and silver/gray led the list of exterior/interior color combinations. Further information on the NAFRD study can be found at the organization’s Web site: www.nafrd.org.