One unsavvy Mercedes-AMG G63 owner found out the hard way about how some online auctions work and it cost him the buyer’s premium on Bring a Trailer
3 hours ago
An AMG G63 seller was nervous about losing money on his vehicle at auction so he bid it up himself on Bring A Trailer (BaT). What he didn’t realize is that he was about to both win his own car and have to pay thousands for that honor. Here’s one case of shill bidding that bit the buyer in the bank account.
Shill bidding is the practice of the seller trying to drive up an auction selling price by bidding on the auction directly. In this case, it turns out that the seller had a friend also bidding up the AMG to make things appear more normal. We’ll come back to that though because there’s another important note to clarify first.
Auction houses have a buyer’s premium that in the case of Bring A Trailer is five percent of the winning bid. For example, a final bid of $100,000 would see the buyer actually pay $105,000 in total with $5,000 going directly to Bring A Trailer. As Doug Tabbutt, the owner of SwitchCars explained to VINWiki, the seller of this G63 asked him to sell the car on Bring A Trailer and required a reserve price of $90,000.
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In cases where the final bid is within five percent of the reserve price, the auction house will consider that vehicle sold. They take the final bid plus the five percent and give the seller their reserve price. All of these factors came together to see the seller of this G-wagon ultimately pay that buyer’s premium for their own vehicle.
By shill bidding their own car up to $86,000 they triggered the five percent rule as the total with the premium came to $90,300. As a result, they now owed Bring A Trailer $4,300 for the auction. Tabbutt says they wanted to somehow get out of the situation but that he sided with Bring A Trailer since shill bidding is unethical.
The seller then contacted Tabbutt and asked him to contact another of the bidders in an effort to sell the car directly. It’s at this point though that the seller informed Tabbutt that at least one of the other bidders was a friend.
He, of course, declined to assist. We see dealers and flippers doing all sorts of shady things in the automotive market at times. It’s nice to know that sometimes, they don’t walk away with a big payday.
