ATF Professional talks to Steve Hankins, Managing Director at IAA UK which is part of IAA, Inc, a leading global digital marketplace connecting vehicle buyers and sellers. He discusses the rebrand of HBC to IAA, the VISion salvage management system and the future of vehicle recycling.
Can you provide a little background about HBC and how it became part of the IAA group
As you’ll probably remember HBC was subject to a management buy-out in 2013 when four of the directors, including me, bought the business. A couple of years later, HBC was acquired by KAR Auction Services (KAR), a leading American vehicle remarketing company, based just outside Indianapolis. KAR had many divisions including ADESA, AFC, Autoniq, and its salvage management business Insurance Auto Auctions (IAA). In June 2019, IAA demerged from KAR to become a stand-alone company listed on the New York Stock Exchange. At that time, HBC became part of IAA – which is comprised of IAA in the United States and now the UK, and Impact Auto Auctions in Canada.
Since the announcement in August 2019 that HBC was to become part of the IAA group, was the rebrand always intended in this time-frame?
Yes, the global salvage business was always intended to be rebranded as IAA.
Terry Daniels, Senior Vice President of Global Operations for IAA, has stated: “Bringing the UK business under the umbrella of IAA’s global brand will provide this market with innovative products and services, technology advancement and exposure to IAA’s extensive global buyer base.” What do we expect to see and what impact do you think this will have on the UK industry?
The most visible impact will be IAA technology which, put simply, creates a digital marketplace better connecting vehicle buyers and sellers, and also facilitates faster and more effective transactions.
The foundation is the VISion salvage management system – our custom-built Enterprise Resource Planning (ERP) system which has been designed in-house exclusively for the global salvage market. VISion fully integrates all of our business processes through the entire lifecycle of a vehicle from inspection through to sale and settlement. It accelerates sales cycles and provides both vehicle buyers and sellers with an unparalleled customer journey.
Now that we have VISion in place, we will be marketing all of our UK vehicle inventory to the IAA global buyer base in over 135 countries across the globe.
Is the timing of the rebrand a coincidence as we come out of the COVID-19 pandemic, and is it a message to say that operations are returning to normal?
The rebrand and technology investments have been in development for over a year now. There was a shift in the technology install because of the pandemic, and subsequent lockdown, and this obviously impacted the rebrand. It was essential that we executed both the rebrand and the IT programme at the same time – the key message is that this is not a simple re-badging of HBC but an investment in, and total transformation of, the business and our service offerings.
As we adjust and come out of the pandemic, there is speculation of a recession. If this was to come about, what effects, if any, do you think they could have on IAA and the industry in general?
Each economic cycle is unique. Historically, recessions have been an opportunity for the salvage industry; demand for spare parts has increased as consumers sought to extend the life of older cars and there were more drivers looking for lower-cost vehicles. In the past, this has increased both sales volumes and selling prices of salvage vehicles.
With IAA entering the UK market, it perhaps indicates that there is much room for growth and potential and that vehicle recycling is beginning a new age with investment, professionalism and adapting to new vehicle technologies. What do you think is the future for the vehicle recycling industry, and what challenges need to be overcome?
There is still so much room to innovate and reshape the UK salvage market and IAA aims to be at the vanguard of those changes. The opportunity to drive higher salvage returns, using traditional total-loss models, is diminishing. It requires a different approach – and IAA’s technology-driven model is that different approach.
In our view, the future will be centred around three key initiatives: creating additional value and reducing costs for vehicle sellers, enhancing the vehicle buyer’s journey, and delivering supply-chain security to motor insurers and other vehicle sellers.
IAA has just announced its Seller Portal and VISion Salvage Management system in the UK. Can you explain a bit more about this system and the advantages it will bring to your clients? Furthermore, how do you think it will help the vehicle recycling industry?
For motor insurers and other vehicle sellers, we have launched the IAA Seller Portal™, which provides real-time inventory management and performance analysis of the total-loss portfolio from initial instruction, through the sale, and on to payment. Along with intuitive, easy-to-use navigation and a fresh look and design, there is new functionality, including a customisable dashboard, a better instruction form, new and improved reporting, ability to search on VIN number as well vehicle registration, the facility to upload documents or add notes to a file, and an enhanced market guide.
IAA Buyer Portal™ will transform the experience for buyers of total-loss vehicles. There is a new, sleek, responsive website, usable on any device, advanced search capabilities that make finding vehicles and other information easier and a one-glance buyer dashboard from search, to bid, to buy, and ultimately to collection. We’re also taking vehicle merchandising to another level with initiatives such as IAA 360 View™ – an interactive, 360° visual of a vehicle’s interior and exterior, and IAA Engine Start™, which is a 10-second video with audio of the vehicle’s engine running.