The acquisition, for an undisclosed sum, was announced yesterday. It will provide Cox Automotive with a platform from which to expand its products and services in Australasia in addition to Dealer Solutions’ existing suite of services.
The move means both Manheim and Dealer Solutions can combine forces with a portfolio of services for dealers, manufacturers, fleet managers, vehicle sellers and the overall automotive industry.
The acquisition heralds the retirement of Chris Vening while his long-standing lieutenant and chief operating officer, Damian Jones, who has been with Dealer Solutions since 1999, will take over as CEO.
Manheim Australia and New Zealand CEO Campbell Jones told GoAuto that the purchase was “a great fit” for Cox Automotive in the Australian and New Zealand markets.
Mr Jones said Cox was attracted to Dealer Solutions “because they are a business that is really highly regarded in the automotive industry built on the right sort of foundations over many years by Chris Vening”.
“We felt that they were a perfect fit in the way they support the motor dealers in the market from a retailing point of view as well as the wonderful work they are doing for the OEMs,” he said.
“We really felt that there was a strong fit from a Manheim point of view but particularly from a Cox Automotive point of view with the Cox Automotive ecosystem they have developed globally and the enormous number of different types of products and services they offer all participants in the auto industry around the world.
“We see Dealer Solutions as a wonderful way of bringing some of those products to Australia,” he said.
“So we will be supporting the Dealer Solutions business which is full of great people. That is one thing that has really impressed us – the wonderful people within the business and certainly the leadership and the executive team.
“This gives us great confidence that we are bringing a fantastic business with the right culture into the family. It is a very people-focused business and, if you get the people part right, a lot of what we want to do will follow suit. So we could not be more excited,” Mr Jones said.
GoAuto understands that Cox Automotive had been thinking about the deal for a long time and began seriously discussing the purchase with Dealer Solutions about 12 months ago.
Cox Automotive International executive vice-president John Bailey said that the investment by Cox Automotive was a “vote of confidence” in the Australasian motor industry.
“Cox Automotive has identified Australia and New Zealand as growth markets and, as a sign of our confidence in Manheim, Dealer Solutions and our people, have made this significant investment in the future growth of our group of companies,” he said.
Chris Vening has made an outstanding contribution to the automotive sector through his ownership of Dealer Solutions – John Bailey, executive vice-president, Cox Automotive International
Mr Bailey added that Chris Vening had made “an outstanding contribution to the automotive sector through his ownership of Dealer Solutions”.
“Chris should be very proud of his achievements and we wish him all the best for the future. I would also like to thank him for his work in making this deal come to fruition,” he said.
Mr Jones said the existing dealer customer base of Dealer Solutions and its potential for growth was a very big attraction in the purchase.
“They are north of 30 per cent of motor dealers in this market with some 3000-plus individual dealerships using Dealer Solutions in one form or another,” he said.
“So they have very good penetration, especially in Queensland and northern NSW. So we think there is a very significant opportunity for them to achieve that penetration in the rest of NSW and in Victoria.”
Mr Jones said that Dealer Solutions has a number of products that are well supported by the car industry in Australia.
“But when we look to the Cox Automotive family of products globally there are businesses such as vAuto (a new and used car inventory management system), HomeNet (which extracts inventory from dealer systems and publishes it online) and Haystak Digital Marketing which uses advanced bid strategies to optimise dealer stock listings to attract online car buyers.
“The fundamentals are that we really want to assist the motor dealer world with the right data and information to help them maximise their opportunities in retailing cars and speed of processing their vehicles through their businesses and speed of taking their vehicles to market with data aggregation links to third-party websites and so on.
“Our challenge will be making sure that we don’t overload the Dealer Solutions guys. They already have a wonderful pipeline of products under development which they are bringing to the market and really for us it is a matter of helping them to accelerate their innovation and development,” he said.
Damian Jones said the synergies between the two companies would benefit customers and fuel business growth.
“Work has already commenced on how we will best collaborate and not only maintain our excellent levels of customer service at Dealer Solutions and Manheim, but build, strengthen and collectively improve our customer-focused approach,” he said.
Disclosure: Cox Automotive has a minority interest in GoAutoMedia Pty Ltd.
By John Mellor