eBay Motors will begin taking a bigger chunk of the sale price after September 2, 2008. Rob Chesney, VP of eBay Motors announced fee changes that although inviting at first, they look kinda bad if you have a successful sale.
Currently, US sellers pay a flat $40 insertion fee for vehicles. If the vehicle sells, they pay a $50 "successful listing fee." (eBay doesn't call it a "Final Value Fee" because they are not automobile dealers. Therefore they cannot legally tie the amount of the fee to the sale price of the vehicle.)
Under the new arrangement, sellers can list their first four vehicles, in a given calendar year, for free. However, the Successful Listing Fee is $125.
So, it's a price increase any way you look at it. What used to cost a total of $90 now will cost $125.
Beginning with vehicle number five, the insertion fee will be $20 per vehicle, and successful listings will be charged $100. So in this case, what was $90 will now be $120. It's a fee increase for successful vehicle sales.
For vehicle sellers in Canada, the news is worse. They currently pay $4.25 to list a vehicle, and $50 more if it sells. Their fees will now be the same as the US fees. A real jump for them. (Thanks Bill for pointing this out.)
Granted, it will benefit sellers who list vehicles that do not sell, since they'll have less up front risk. My first thought was how vehicle sellers will game the system - and they will.
eBay Motors - Post 9/08
To take advantage of the four free listings. Sellers will definitely use multiple accounts. Four free per account. Simple, and not much harm done to anyone in the big picture.
The harm will come from dealers who sell off-eBay. Higher fees are an incentive to avoid them altogether.
Dealers will put more inventory on the site, thanks to the lower insertion fees. In turn they'll grab more leads, and intercept the sale to avoid the "successful listing fee." Buyers will have nowhere to turn when and if things go wrong. As a result, eBay Motors will suffer along with the eBay core site. Since buyers will say they "found the car on eBay" - eBay will take the hit.
Vehicle dealers are seriously hurting all over the world. This fee increase is coming at the worst possible time for them.
Popularity: 16% [?]
0 comments ↓
There are no comments yet...Kick things off by filling out the form below.
Leave a Comment