IAA Catastrophe Response Strategy: Vehicle Merchandising

Overview

When the unexpected happens, a swift recovery is critical to ensure business continues and communities get back on their feet. IAA’s Catastrophe Response Strategy is sound and scalable, enabling us to respond to the unpredictability, size and frequency of any weather event. Because these catastrophe events, such as wildfires, hurricanes and tornadoes, have many shifting variables, a proactive yet flexible process is necessary to ensure a timely and appropriate response.

IAA’s Catastrophe Response Strategy provides an unmatched level of service to our customers in their greatest time of need. It comprises four key areas: Real Estate Capacity, Operational Execution, Transportation Logistics and Vehicle Merchandising.

Here, we dive deeper into Vehicle Merchandising.

In the aftermath of a catastrophic weather event, nearby IAA facilities must manage an influx of thousands — sometimes tens of thousands — of total-loss vehicles. Without an innovative, multi-dimensional plan, this large volume of vehicles, coupled with the chaos of a catastrophic event, would pose major cycle-time challenges. Extending cycle times can increase insurance provider costs, lower returns, and reduce customer satisfaction. Processing and selling these vehicles swiftly and efficiently is critically important to our customers and their policyholders.

During normal, day-to-day operations, IAA helps our sellers achieve their business goals with industry-leading technology found in IAA’s products and services. After a catastrophic event, these products and services play an even more critical role in adding value to our customers throughout the entire sale process.

IAA’s Catastrophe Response Strategy focuses on four primary areas to quickly process, create awareness and demand, and sell thousands of vehicles after an event. By focusing on these four areas, we help our customers lower cycle times, minimize depreciation, increase returns, and maintain policyholder satisfaction, while giving buyers trust and confidence in bidding and buying:

• Technology – To quickly secure and inventory vehicles using the IAA Tow App™, IAA Inspection Services™ and IAA Title Services™

• E-Commerce Merchandising – The IAA Interact™ merchandising platform combines imagery, information and personalization to provide vehicle details and reduce the risks associated with the purchasing process for the buyer. This is critical when working with very high volume of vehicles. IAA’s merchandising platform allows buyers to assess damage and value, driving confidence.

• Marketing – IAA’s dynamic marketing approach uses social media, digital advertising, brand ambassadors, segmented direct marketing, email journeys, flooring relationship/promotions and online content to create awareness and drive demand among buyers for the influx of vehicles.

• Auction Model – IAA’s auction model provides multiple bidding and buying channels. Having multiple methods provides further efficiency, selling cars faster and expanding options to buyers.

Workflow Technology

Before a total-loss vehicle can be merchandised and auctioned, there are several issues that may need to be resolved, including vehicle titling and lien settlement. Even in non-catastrophe situations, without innovative solutions these processes can be arduous and time-consuming. The technology that IAA offers can streamline the tasks required to prepare the vehicle for sale. These are particularly valuable during catastrophe events. IAA’s technology can help trim days to weeks off these required processes and can increase the potential vehicle return.

IAA Tow App™

This mobile dispatch solution transforms vehicle transportation, automating the entire process. This reduces the time required to transport vehicles to IAA sites for storage, marketing and sale. It eliminates the wait time required with a traditional, paper-based towing assignment process.

IAA Title Procurement™ and IAA Title Solutions™

These products provide sellers with access to a full-service title procurement team and a suite of services to help support every part of the settlement process.

IAA Loan Payoff™

Since its inception, the IAA Loan Payoff solution has truly evolved into the clear industry leader for lien resolution. Imagine eliminating time spent in phone tag and hold times, vehicle title inaccuracies, time correcting payment sent to the wrong lender, costs to print and ship documentation, and the headaches an Alternative Disposal status creates because of these avoidable delays – that’s IAA Loan Payoff.

Carriers that utilize IAA Loan Payoff have quickly seen the return on their investment in the reduction of fixed costs, time to manage a manual process, and an increase in accuracy rates that ultimately mitigates risk of Alternative Disposal status. It offers lenders and insurers one cohesive digital solution that delivers positive and negative equity functionality, real-time payoff quotes, letters of guarantee, access to title vaults, and direct connection and ACH payments to lenders.

IAA Inspection Services™

This solution enables inspection processes that fit the challenges within a specific market and/or vehicle category. It is an especially helpful option to avoid mounting advanced charges and keeping the claims process moving in the face of labor constraints, which is particularly important following a CAT event. It provides a greater flexibility of resources, and a virtual adjuster can be located anywhere.

E-Commerce Merchandising

Once a vehicle is ready for sale, the IAA Interact™ merchandising platform helps sell units quickly. The industry’s first comprehensive merchandising platform provides potential buyers with the necessary imagery (IAA 360 View™, IAA High Resolution Images™, IAA Key Images™), information (SpinCar® Feature Tour®, IAA Engine Starts™ video, Chrome Equipment Details), and personalization designed to engage buyers, increase bids and returns, and decrease cycle times. IAA’s industry-leading e-commerce strategy helps it sell a large volume of vehicles swiftly after a catastrophic event by reducing risks associated with the bidding and purchasing process for buyers. The Interact platform provides all the information buyers need to make better-informed bidding and purchasing decisions. This increases buyer confidence and drives them to bid more, promoting competition that can result in increased returns.

The platform engages buyers with a vehicle digitally through unique, multiple touch points that provide the details needed to make confident online bidding and buying decisions. The Interact tools and features provide buyers with an unmatched research process, improved purchasing guidance and greater trust.

Marketing 

IAA expands its marketing efforts to bring in a large influx of buyers to purchase thousands of vehicles in a short period of time following every CAT event with a full-spectrum approach. Social media, digital advertising, segmented direct marketing, brand ambassadors, email journeys, flooring companies/promotions, and engaging online content are all used to make buyers aware of increased buying opportunities. Our use of multiple marketing platforms helps increase exposure for the sales, driving buyers to view inventory, and creating awareness of when sales are scheduled so the process of bidding/buying is efficient for the buying customer.

In addition to alerting more buyers to the opportunity to purchase from an unexpected influx of vehicles, IAA also communicates how we can assist them with financing, payment options, and our different auction types.

All marketing efforts help bring an abundance of buyers to IAA auctions featuring catastrophe vehicles, helping to increase bids and returns, and decrease cycle times.

Auction Model 

IAA’s auction model provides the choice, flexibility and convenience our buyers and sellers need. It also provides our sellers with additional marketing opportunities. When catastrophic weather events create a high volume of vehicles to be sold, this approach benefits IAA’s sellers and buyers alike. IAA’s flexible auction model supports additional and continuous exposure for vehicles, allowing vehicles to flow from one auction channel to the next. A vehicle, for example, can immediately move to Buy Now prior to a scheduled auction, and if it is not sold, it can then shift to a Timed Auction. This model helps sell vehicles quickly since they are listed for a set amount of time and can improve seller returns.

Our industry-leading auction experience has been created and improved by continually listening to buyer feedback and then innovating to make it even better. For maximum buyer/seller benefit we offer the following online auction channels:

• IAA Timed Auctions™ 
  Offers a unit for sale for a specified period of time. This online-only model allows for competitive bidding and sale prior to our scheduled IAA Live and Online auctions.

• IAA Online / Digital (Branch) Auctions™ 
  IAA weekly online Branch auctions from our 200+ U.S. locations.

• IAA Buy Now™ 
  Provides a unit for sale for a specific price determined using analytical data. This model allows units to get exposure and sell between scheduled auctions.

• IAA Electric Vehicles™ 
  Single IAA auction to find all electric vehicles in one place from a variety of EV manufacturers.

• IAA Specialty™ 
  IAA auction dedicated solely to light, medium and heavy-duty equipment. Features semi-trucks, trailers, construction vehicles, RVs, agricultural equipment and more.

• IAA Rec Rides™ 
  Dedicated solely to powersports, including motorcycles, ATVs, snowmobiles, jet skis and more. Rec Rides includes salvage title, clear title, repossessed, rebuilt, repairable, donated and parts-only units.

• IAA Dream Rides™ 
  Special IAA-curated auction that features classic, exotic, muscle and luxury vehicles.

Hurricane Harvey: A Case Study

When Category 4 Hurricane Harvey made landfall in late August 2017, it left an immense path of devastation in the state of Texas and a huge volume of total loss vehicles. IAA quickly ramped up its merchandising efforts and went from selling an average of 1,800 vehicles per week in the Houston market, to more than 5,200 per week.

By January 31, 2018, IAA had over 95% of the 65,000+ vehicle inventory sold. In collaboration with our customers, our dedicated CAT teams, our extensive network of towers, our marketing and merchandising efforts, and the commitment from the Texas Department of Motor Vehicles to turn titles fast, IAA delivered with record-shattering speed.

Here’s the story of IAA’s Hurricane Harvey response by the numbers:

IAA Merchandising: Competitive Advantages 

• IAA has consistently delivered the industry's leading catastrophe service and response in events that have occurred in the last 40 years.

• Our industry-exclusive workflow technology (IAA Tow App, IAA Title Procurement, IAA Title Solutions, and IAA Loan Payoff) can trim weeks off cycle times, save hundreds of dollars per vehicle, and help us get vehicles ready for sale faster.

• IAA’s industry-first, comprehensive Interact merchandising platform uses imagery, information and personalization to engage buyers, increase bids and returns, and decrease cycle times. All critically important to selling thousands of vehicles rapidly after a catastrophic event.

• IAA’s proven marketing efforts can attract tens of thousands of buyers from around the world to bid on and purchase vehicles after a catastrophic event. After Hurricane Harvey, IAA’s marketing knowhow, in part, allowed us to sell 65,000+ vehicles in five months.

• The flexibility and convenience offered by IAA’s auction model gives buyers and sellers a wide range of choices for buying/selling vehicles. Available year-round, our auction model helps IAA move a large quantity of vehicles fast.

• Merchandising alone cannot manage a catastrophe. IAA’s Catastrophe Response Strategy consists of four components, including Real Estate Capacity, Operational Execution, Transportation Logistics, and Merchandising – an unmatched portfolio of capabilities.

Forward Looking Statements

Certain statements contained in this release include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”) and Canadian securities laws. Forward-looking statements are typically identified by such words as “aim”, “anticipate”, “believe”, “could”, “continue”, “estimate”, “expect”, “intend”, “may”, “ongoing”, “plan”, “potential”, “predict”, “will”, “anticipates”, “should”, “would”, “could”, “likely”, “generally”, “future”, “long-term”, “foresees”, “estimates”, “opportunity” or the negative of these terms, and similar expressions intended to identify forward-looking statements. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties that may cause actual results to differ materially. These statements are based on our current expectations and estimates about our business and markets, and may include, among others, statements relating to IAA’s Catastrophe Response Strategy, our future strategy, objectives, targets, projections and performance and other statements that are not historical facts. It is uncertain whether any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what impact they will have on the results of operations and financial condition of the combined companies or the price of RB Global’s common shares. Therefore, you should not place undue reliance on any such statements, and caution must be exercised in relying on forward-looking statements. While RB Global’s management believes the assumptions underlying these forward-looking statements are reasonable, these forward-looking statements involve certain risks and uncertainties, many of which are beyond RB Global’s control, that could cause actual results to differ materially from those indicated in such forward-looking statements, including but not limited to: our results of operations, strategy and plans; potential adverse reactions or changes to our business or employee relationships; our ability to integrate acquisitions (including IAA, Inc. ), the diversion of management time on transaction-related issues; the ability of RB Global to retain and hire key personnel and employees; the significant costs associated with the merger; the outcome of any legal proceedings that could be instituted against RB Global; changes in capital markets and the ability of the company to generate cash flow and/or finance operations in the manner expected or to de-lever in the timeframe expected; the failure of RB Global to meet financial forecasts and/or KPI targets; legislative, regulatory and economic developments affecting the business of RB Global; general economic and market developments and conditions; the evolving legal, regulatory and tax regimes under which RB Global operates; unpredictability and severity of catastrophic events, including, but not limited to, pandemics, acts of terrorism or outbreak of war or hostilities, as well as RB Global’s response to any of the aforementioned factors. Other risks that could cause actual results to differ materially from those described in the forward-looking statements are included in RB Global’s periodic reports and other filings with the Securities and Exchange Commission (“SEC”) and/or applicable Canadian securities regulatory authorities, including the risk factors identified under Part I, Item 1A “Risk Factors” in RB Global’s most recent Annual Report on Form 10-K for the year ended December 31, 2023. The forward-looking statements included in this release are made only as of the date hereof. While the list of factors presented here is considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Many of these risk factors are outside of our control, and as such, they involve risks which are not currently known that could cause actual results to differ materially from those discussed or implied herein. RB Global does not undertake any obligation to update any forward-looking statements to reflect actual results, new information, future events, changes in its expectations or other circumstances that exist after the date as of which the forward-looking statements were made, except as required by law.