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To: nokomis who wrote (75548)	12/15/1999 9:54:00 PM
From: kendall harmon	Respond to of 120523

CPRT from todays IBD <<EBay Inc. it's not. But Copart Inc. surely took a few tips from the online auctioneer when it set up its own auction site on the Web specifically for dismantlers of salvaged cars. Copart is believed to be the first brick-and-mortar salvage auctioneer to offer online bidding. On its Web site, the company posts lists of cars due to be auctioned off at its 69 floors nationwide. Photographs are included showing the extent of each car's damage. If a dismantler in Los Angeles needs a 1998 Mercedes 320 with the front end intact, he can conduct a national search on Copart's Web site. Should there be a suitable match, even in faraway Mississippi, the dismantler can bid for and buy the vehicle without being present. The only catch is shipping the vehicle once it's purchased. But for a higher-value vehicle in short supply, that cost is considered nominal. Going Global "(Salvage auctioning) used to be strictly a brick-and-mortar business conducted on a local basis. But with the Internet, you might say we've gone global," said Jason Adair, Copart's president. "We are even selling to bidders in Canada and Mexico." Copart's core business is to liquidate, via auction, wrecked vehicles regarded as complete losses and left on the hands of insurance companies. The cost of fixing the damage may exceed the value of these cars even after they're repaired, but the parts still have value. Recovered stolen vehicles for which an insurance settlement with the vehicle's owner already has been made also are auctioned. Bidders on these include licensed dismantlers, rebuilders and used vehicle dealers. Copart shares the auction price with the insurer or gets a flat fee for each car sold. It also receives fees for towing and storing the vehicles and handling the paperwork, including title transfer. Copart has 20% of the salvage auction market, on par with its largest rival, Insurance Auto Auctions Inc. Before online bidding appeared, Copart's business was growing at a single-digit rate. Now that rate has been bumped into the double-digits. In its fiscal first quarter ended Oct. 31, same-store sales climbed 32% vs. a 25% gain in the prior quarter. Raising Prices The Internet is doing more than expanding the field of buyers. It's raising auction prices by feeding more demand into the system. This, in turn, enhances Copart's reputation with insurers, which results in more vehicles being sent its way. This is Copart's ultimate goal. "Any vehicle sold on the Net sells for at least one increment higher than would be usual. And any vehicle that is pushed sells for at least two increments higher, maybe more," said analyst Walter Kirchberger of PaineWebber. "This allows Copart to say to an insurer, ‘I can get you more for your vehicles.' That's important, as it's all about getting more cars to auction." Copart usually requires online bidders to submit in advance the maximum price they will pay for a certain car. If someone online put in a bid of $1,800 and the last price on the auction floor is $1,600, the online bid usually is lowered to one increment higher than the last floor price to, say, $1,650. Someone on the floor then can "push" his bid to $1,700, and the online bid then would push it up more. In the first quarter ended Oct. 31, Copart's earnings climbed 53% to 23 cents a share. Sales rose 34% to $40.5 million. Analysts expect earnings to hit $1.01 in 2000 and $1.27 in 2001, First Call says. The company sells as CPRT near 29. More Brick-And-Mortar In addition to online moves, Copart is adding to its network of brick-and-mortar sites. This fiscal year, it plans to open six to 10 locations, four of which already are open. Ultimately, the company sees the potential to grow from its current 69 sites to 100 sites nationwide. The plan is to expand into smaller cities of under 1 million residents. Copart also is trying its hand at public auctioning, where the cars come not from insurance companies but from financial institutions (repossessions), car dealers (trade-ins) and public sellers. The company sees tremendous potential here, as 10 million vehicles are sold via newspapers each year. Salvage auctions handle 2.5 million to 3 million cars annually. "We've spent the last year looking at the public auction market and like what we see," Adair said. "It could eventually be bigger for us than salvage.">> investors.com