Copart Germany: A New Salvage Auction Model | In Practise

Copart Germany: A New Salvage Auction Model

Former Director at Copart Germany

Learning outcomes

  • Regulatory differences between the German and US auto insurance industry
  • The existing German salvage model and why it’s inefficient for both buyers and sellers
  • History of Copart acquiring WOM to enter the German salvage market
  • Why only 10% of buyer bids actually receive the car and how Copart solve the issue
  • How Copart are changing the German auto insurance regulatory landscape
  • The new Copart model in Germany and how the profits are shared with insurers
  • Core challenges in scaling the Copart model in Germany
  • How Germany can unlock the rest of Europe for Copart
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Executive profile

Andreas Zeh

Former Director at Copart Germany

Andreas has 15 years in the German automotive salvage industry and is a Former Director at Copart Germany. Andreas grew up working on his family’s car dealership and was involved in buying and dealing wrecked vehicles very early in his life. In 2005, he joined WOM, one of the largest German salvage auction companies which Copart acquired in 2012, and was heavily involved in bringing Copart to Germany. Andreas became a Director at Copart after the WOM acquisition and he was responsible for driving new relationships with insurers to roll out the Copart model. He now works for carexpert, a leading German auto claims management company, where he works with insurers and Copart throughout the country. Read more

Andreas, can you provide some context to your background in the German salvage industry?

From my childhood, I started working in my parent’s company. They had a car dealership and, there, I took my first steps in the salvage market, because we had lots of vehicles from accidents that had been wrecked, which we had to sell or which we were buying. From that time on, I became familiar with these accident vehicles. I did my studies, went to school and I also did an exchange year in the States, in Texas. In 2005, there was a big opportunity for me that WOM, Wreck Online Market, one of the salvage auction platforms was founded and I had the chance to step into the company and to raise the company from scratch.

I started in 2005, in WOM. From there, we built out the business. We established the workflows for the total loss vehicles, we provided a very good service and we improved the service. Later on, I will talk about the key facts of what is good at WOM and differentiates it from the other salvage auctions. I started there as an assistant to the board and grew up through the different departments and, finally, became the IT product manager. I also undertook some additional certificates in IT management. We improved our platform and our interfaces to the insurance companies here in Germany. We also made a good contact with the company called Copart which then, in 2012, bought the WOM company. I still worked at WOM, until 2019, as a product manager for Copart and made sure that the processes from WOM to Copart were integrated and that the Copart business could run well, here in Germany.

In 2019, I made a decision, related to the geographical location of my family. WOM and Copart were quite a distance from my home, so I decided to switch more to the insurance side, so I started to work for an insurance company, one of the biggest here in Germany. We have 450 car assessors, who go to the vehicles and decide what to do with the vehicles and how to compensate the car owners for the loss or damage. It is actually one step before the WOM platform, so we bring the damaged vehicles to the auction platforms, to get a salvage estimate, and then compensate the car owner.

That’s where I am right now. I am a business development manager and sales manager at carexpert. As I said, it is a company owned by three insurance companies, R+V, Ergo and Nürnberger, which is also pretty close to my hometown, to my family, so I just have to drive 15 to 20 minutes and then I am at work. When I was working at WOM and Copart it to me more than an hour to get to work, sometimes even two hours. I also spent a lot of time in hotels during that time. As I am now a father of two children, I now have more time to spend with my family. Of course, during this coronavirus pandemic, I am working from home, so I have even more time to spend with my family.

Did you approach Copart, at WOM, to sell the business?

We first met Copart at an exhibition, in 1998, where WOM was presenting their services and had a big stand. I actually made a contact with some guys at Copart, in the UK. From that time on, we met almost monthly, to talk about the opportunities for Copart, the opportunities for WOM. It took a couple of years until Copart could buy out WOM. WOM was also founded as an incorporated company and the shares sat with the big car dealership here in Germany. They sold all of their shares to Copart.

You actually saw the vision of a potential consignment model in the early 2000s, if not earlier?

Yes, exactly.

Can we dive into the German salvage industry. Let’s just assume we have a pre-accident value, of a vehicle, of €10,000. What is the process, typically, in Germany, when the policy holder crashes?

In the time before the salvage auctions, if there was an accident, a car assessor would look at the car and would estimate the salvage price by guessing or by orienting on some online platforms, such as mobile.de or AutoScout, newspaper announcements, where they put vehicles up for sale. This was before the auction platforms.

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Copart Germany: A New Salvage Auction Model

November 4, 2020

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