Industry News & Trends

AutoTrader Buys KBB

autotrader buys kbb

AutoTrader Buys Kelly Blue Book (Kbb)

Just as the press was cooling down on the announcement of AutoTrader buys vAuto, AutoTrader.com turns around and has bought Kbb.com (Kelly Blue Blook). The rumors have been flying around for awhile now with several other companies/investors interested – including our beloved investors of Zag.com and TrueCar.

Cliff Banks over at Dealer Communications reports that in an exclusive interview with Dealer Communications and the Wall Street Journal, AutoTrader President and CEO Chip Perry and Kelley Blue Book President and CEO Paul Johnson talked about the background and the strategy for the deal.

Industry insiders estimate the deal was in the neighborhood of $550 – $600 million and is expected to close by the end of the year.

In September Kelly Blue Book made a bold move and dropped AutoTrader as it’s source of advertised dealer inventory and moved over to a Pay-Per-Lead model having it’s inventory powered by Vast.com. With this acquisition, it would only make sense to have Kbb.com’s inventory will once again be powered by AutoTrader. Of course I can’t imagine this being the only reason to buy Kbb.com.

What else does Kbb.com have that AutoTrader can find value in?

What will AutoTrader do with ALL this great data? 🙂

This industries landscape will continue to change, and in a fast way if people make the right/wrong decisions.

Founder of DealerRefresh - 20+ Years of dealership Sales, Management, Training, Marketing and Leadership.
C
Where will they stop? They are on a roll. Just reread your post from last May regarding the investment in ATC by Providence Equity Partners and what might play out <a href="http://(http://www.dealerrefresh.com/autotrader-sold-providence-equity-partners/)" rel="nofollow">(http://www.dealerrefresh.com/autotrader-sold-providence-equity-partners/)</a>.

Seems like they still have work to do but will all this be a Dominion type shopping spree or can ATC make something happen?
W
Good for ATC, bad for competition... KBB is a huge acquisition. The thing I&#039;m afraid of is, will this stifle creativity?
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    Andrew Wright
  • October 26, 2010
To me this acquisition makes perfect sense although I&#039;m surprised that the Cox entity making the purchase is Autotrader and not Manheim although I guess it doesn&#039;t really matter. Now you have the marquee name in wholesale vehicle valuations (Manheim) partnering with the marquee customer vehicle valuation source (KBB). Again, I guess that is a good thing.
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    john oconnell
  • October 26, 2010
What does this do to Cars.com ? It is clear these are not the best of times for the media based Cars and their parents they are fighting for their own lives and now AT is just building a fortress of a company.One thing is clear it is all about the data and Cox is getting data from every angle. Things just got a little worse at the newspapers. Who else will be hurt by this?
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    Leslie Markel
  • October 27, 2010
AutoTrader&#039;s acquisition of vAuto and now KBB is not a good thing. It will be only a matter of time before both brands will be destroyed by Chip and his buddy&#039;s. Most informed dealers have woken up to the false promise of Auto Trader. Sad to see that the AutoTrader is taking company&#039;s like Hitler took Europe.
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    Rufus
  • October 29, 2010
Leslie,


Unfortunate and malicious analogy in your October 27th comment on KBB and vAuto.
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Leslie,


Really now, &ldquo;like Hitler took Europe&rdquo;? I don&rsquo;t know what axe you have to grind with AutoTrader or Chip Perry, but very respectfully the acquisition by AutoTrader of vAuto and KBB is a very positive thing for dealers.


One of the most common frustrations of dealers is the lack of integration between systems and tools. Lack of such integration requires dealers to perform duplicative tasks and importantly prevents them from recognizing the true synergy of critical applications. For example, the union between AutoTrader and vAuto will allow dealers to make pricing and stocking decisions knowing what consumers are searching for in their market in real-time at precise price points.


Further, the Kelley acquisition will enable dealers to have classified advertising exposure in a high traffic trusted medium, where it was otherwise unavailable. Giving dealers exposure, in a medium and manner otherwise not available, is a big win for dealers.


There is one further insight that I would like to share with you and others. Although I have know Chip and some of his executives for several years, over the past 6 months I have come to know much more about him and his broader organization. Without hesitation I can tell you that the executive management of AutoTrader is comprised of many individuals who are intelligent and passionate about building a great company to serve dealers. They are serious about their mission and understand that their success is based on the success of their dealer clients. If there is something in particular that is bothering you, I would be very eager to discuss it, and try to resolve the source of your dissatisfaction. My contact information is as follows: 630-343-9016 and [email protected] It is important to constructively communicate and work together.


Respectfully,


Dale
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