Autotrader.com for sale? Not anymore - is that too bad?

[Alex Snyder]

Our (okay, maybe not "our" but definitely my) favorite online vendor was for sale for almost a month, but isn't anymore.  According to Ward's:

AutoTrader.com is estimating 23% growth in revenue this year to $635 million. It has some 2,600 employees and with 14.9 million unique visitors, it is one of the leading online automotive services.

Read the whole article here:  http://wardsdealer.com/latest/autotrader_market_off_081111/

If Autotrader.com is such an asset why would Cox Communications even consider selling it?  Is something happening behind the Oz-curtain?

 

[Matt Watson (blog)]

I'm not buying that their revenues are up. Not in this economy... dealers are slashing their advertisement budgets.

 

[Cliff]

Cox has a signifcant amount of debt it has to get rid of AT will bring Cox a lot of cash it will use to pay down that debt.

Ony problem is, acquisitions aren't happening while the credit crisis is ongoing. So they had to take it off the market for the time being.

 

[Ryan]

I'd like to have the over at 150 posts!

From the Ward's article 'Sources say the process didn’t get far enough with interested buyers to determine a possible price. Although there were several interested purchasers, the current market environment makes it difficult to contemplate such a large transaction."

Who do you think the "interested purchasers" are and what would they do to the product?

 

[Brian in Etown]

635 million in revenue is a crazy amount of cash! I wonder how much they were hoping for? Going off what some dot com's have sold for that didn't have any revenue and using atc math, 635 billion will be the buy it now price! I think dealer refresh should start a buy autotrader.com fund. Could you imagine if the dealer community owned atc?

 

[Brian in Etown]

Oh and Ryan, I see that you have learned that you never take the under on ATC. Alex I hope you have learned your lesson as well

 

[David (blog)]

We are a software company based in Tulsa Oklahoma. We have about 80 dealer customers. For the last couple of Months, we start to have dealer calling us and ask if they can do any Ad besides AutoTrader.com. (Half of our dealer use AT) This has never happen before since we assume AT give them the result or return that dealer expected. Now we have to assume AT is NOT performing well as they used to do.

Some comments from our dealer customer

1) Cars.com is performing the same as AT, but with lower price tag
2) Price increasing is beyond dealer’s budget
3) We feed our dealer’s inventory to AOL, MySpace, Google Base really help dealer to get more attention.
4) We have been looking at all AT customer in Tulsa Area, we have not seen their customer base grow like they used to be.
5) Craigslist give dealer VERY positive results.

Can you share your comments on AT results? return? ROI?

Thanks

David

 

[JIM]

The revenue of AT is very questionable in the present market. AT is a online classified ad. They do not project,or claim to be a lead provider and unless you have an internel method to track where your customers originate you would only guess as to the ROI of AT.
I believe that the some of the new marketing concepts discussed here are implemented in AT then they will further decrease in market share.

 

[Billy]

AT has done a great job of portraying themselves as the 800 lb gorilla to dealers and the public.

Through our lead provider rating report, AT ranks as above average among all lead providers.

Even for dealers that have no idea what their ROI is for AT or any other lead provider (yes I know you guys don't call yourselves lead providers) the image of that 800 lb gorilla is too much not to be a part of.

 

[Jesse]

They want to sell because they reached viable market penetration a while ago and realistic new sales growth is not there at least in this economy their revenue will do nothing but decline. They've recently consolidated top end management regionally from 4 national divisions down to only two (East & West) I would venture a guess that they are going to reduce force after their fiscal year ends in Dec. by reducing field sales operations by a significant amount. They've had a crazy year raising rates and renewing contracts early into a reccessive economy. I can't think of another possible way they could've alienated and pissed off their dealer accounts anymore than they managed to accomplish this year. As soon as the capital markets improve they'll dump it, they've already put 29 unprofitable newspapers up for sale along with Valpak.