General manager Doug Rodriguez stands in front of the auction line during a car auction at Dealers Auto Auction. Auto dealers bid for cars in monthly auto auctions that are also webcast for online bidding.

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Hammer Time

Every Thursday morning, hundreds of vehicles pass through a five-lane auction garage on Stein Road that sits on a 68-acre complex nestled behind a grove of trees. Even though the Dealers Auto Auction of Chattanooga is just a few hundred yards from Chapman Road, home of the highest concentration of car dealerships in a 100-mile radius, the auction is largely unknown outside the car business.

One Tuesday night a month, the facility — which is anchored by a modern, two-story office suite connected to the immense auction garage — holds a public auction that features government surplus and budget vehicles. Still, DAA mainly exists to be the nexus of automobile wholesaling in the region.

On Thursday mornings from 9:30 until midday, the auction garage fills with scores of buyers representing area dealerships — from name-brand new-car stores looking for diamonds in the rough for their used-car departments, to "buy here, pay here" dealers hunting reliable bargains to stock their lots. On a busy morning (and they're all busy, to a point) the auction might move up to 300 vehicles. Yes, that's over 100 sales an hour, almost two a minute.

Doug Rodriguez, general manager of Dealers Auto Auction of Chattanooga, says his fee-based company may sell as many as 16,000 vehicles this year at an average transaction price of about $7,100.

Each vehicle is given a detailed inspection that results in a rating that dealers can trust to be an accurate reflection of the condition of the vehicle. If DAA's ratings weren't consistently spot on, it would erode business, Rodriguez says.

The auction is such an efficient reflection of the local used-car market that dealers here use it as an appraisal service to determine what to offer consumers for their trade-ins.

On auction day, up to 200 buyers converge on the property to take part in the rapid-fire bidding that involves up to five auctioneers hammering deals simultaneously. The buyers, mostly middle-age men, can literally kick the tires on the vehicles as they funnel into different lanes: one for new-car franchises, one for cars sold without reserve, one for surplus vehicles, one for former rental cars and one for inoperable vehicles.

In a recent month, about 40 percent of the DAA vehicles were from rental and commercial fleets, 25 percent were offered by new-car franchises, 22 percent were from existing used-car inventories, 6 percent were government surplus vehicles and 7 percent were bank repossessions.

During the sale, cameras record the procession of cars for Internet buyers, who can place their bids remotely. If 500 units cross the blocks on a given Thursday, DAA expects to actually sell about 300, or 60 percent of the vehicles, Rodriguez said.

"It's vital to our survival, I buy there every week," said Benny Hamby, used-car manager at Crown Chrysler, Dodge, Jeep, RAM of Chattanooga, noting DAA's emphasis on customer satisfaction. "I doesn't matter what kind of problem you have, they are there to do the right thing."

A big share of the automobiles auctioned at DAA of Chattanooga are former fleet vehicles from rental companies. ARI, a giant fleet management service that supplies cars for auctions, has rated DAA of Chattanooga No. 1 in its 11-auction region based on several customer satisfaction metrics. ARI measures things like pick-up promptness, number of days it takes an auction to sell a vehicle, on average, and how quickly funds are posted back to the sellers.

DAA also gets high marks as a place of employment, recently winning an independent national award for employee satisfaction, an honor Rodriguez credits to the company's collaborative management style.

Michelle Gomez, sales coordinator, said she started as a driver at DAA and worked her way through the call center eventually into middle management.

"The work environment inspires the employees to not only look at this as a job but as a lifelong career," she said.

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