Consignment | Fleet Management
A situation where a vehicle owned by one party (such as a leasing company), is entrusted to another party (such as an auction company) for remarketing or sale. Ownership remains with the initial party until the vehicle is sold.
In fleet management, consignment refers to an arrangement where a vehicle owner—such as a leasing company, fleet operator, or government agency—entrusts their vehicle to a third party, typically an auction house or dealership, for the purpose of resale. The consignor retains legal ownership of the vehicle until it is sold, while the consignee is responsible for marketing, storing, and facilitating the sale. This model enables fleet owners to offload the logistical and administrative burdens of selling vehicles, allowing them to focus on core operations.
Consignment is particularly prevalent in the remarketing of fleet vehicles, especially when they reach the end of their service life. Auction companies like Manheim and Copart specialize in handling these transactions, offering services that include vehicle inspection, reconditioning, title processing, and access to a broad network of potential buyers through both physical and online auctions. This approach often results in higher resale values and faster turnover compared to direct sales, as consignors benefit from the consignee’s expertise and established sales channels.
The consignment process is governed by a formal agreement outlining the responsibilities of both parties, including terms for storage, sale procedures, and commission structures. Typically, the consignee earns a fee based on a percentage of the final sale price, incentivizing them to secure the best possible outcome for the consignor. This arrangement provides a flexible and efficient solution for fleet owners seeking to maximize returns on their assets without the complexities of managing the sales process themselves.
Sources
[1]Copart Auto Auctions (Guide) – Dealer 101®