Latest British car import: A cut-rate sales model

Into an already challenged U.S. market comes competition from across the pond. But this British invasion is premised not on music but cars - specifically, used cars.

WeBuyAnyCar.com, a family-owned business in the United Kingdom that has been doing what its name says since 2005, wants a piece of the used-car market in this country. It has plans to move into a U.S. headquarters in Media by Nov. 1 to coordinate that expansion.

Since March, WeBuyAnyCar executives have been operating out of temporary offices near Philadelphia International Airport and have opened four modest car-buying outposts in this area: two in the city and one each in Willow Grove and Cherry Hill, with more planned. In all, they have opened about 20 U.S. sites, with the latest debuting Thursday in Boston. An Atlanta launch is planned for next week.

Never mind the bricks and mortar. The cornerstone of the company's operation is software - an online "pricing engine" like none other in the industry, said Chris Adams, an Indiana resident and 17-year veteran of Enterprise Rent-a-Car who helped start WeBuyAnyCar abroad and is heading its U.S. effort.

That pricing engine enables anyone interested in selling his or her car to get an online quote within 60 seconds based on "real-time" conditions such as demand, oil prices, and credit markets.

If the quote is acceptable, the car owner takes the vehicle to the nearest WeBuyAnyCar site, where a manager or manager trainee (the typical staffing at any site) will look over the car and drive it before cutting a check on the spot if various legal and financial terms are met.

The vehicles are then sold at auction, Adams said.

For the consumer who thrives on haggling, WeBuyAnyCar might not be the right choice.

"Our price is our price," Adams said.

Unlike car dealerships, which derive revenue not only from vehicle sales but from repairs, WeBuyAnyCar's only revenue source is those auction sales. Margins on such wholesale transactions usually aren't as large as what can be achieved through retail sales.

"Our margins are that thin," Adams said. "Success in the U.K. is volume-driven and low margins. The scale needs to be there for us to do that."

That's why consumers need to check a variety of options to determine the worth of a vehicle before selling it, said Kevin Mazzucola, executive director of the Automobile Dealers Association of Greater Philadelphia. Although selling a car privately online or through the newspaper might yield a higher price than through an entity such as WeBuyAnyCar, he said, it comes with the "hassle" of arranging the deal and "worry" about checks bouncing.

Of WeBuyAnyCar's arrival here, Mazzucola said: "Competition is not a bad thing."

WeBuyAnyCar handles 1.5 percent of all used-car transactions in the United Kingdom, buying and selling 1,500 to 3,000 cars a week, Adams said. If that same market share can be achieved in the United States, that would mean 20,000 cars a week, he said.

Conditions are not ideal, he acknowledged. There is a continuing shortage of used cars resulting from the economy's collapse three years ago and the chill that has had on new-car purchases. When new cars aren't being bought, cars aren't being traded in, and the used-car inventory dwindles.

Even when the economy improves, WeBuyAnyCar should not expect an easy go of it here, said Chris Albertson, a salesman at Import Cars of West Chester, which buys cars as well as sells them.

"I think they're going to find this is a very competitive and difficult environment," Albertson said.