Metal to Metrics: Remarketing & Recovery Strategies

Abstract: In this panel on recovery and remarketing strategy, Erin Maloney (Senior Director, Reservices, CanCap) moderated a discussion with Taylor Bursey (Director of Sales, Copart), Gerry Johnson (National Accounts, Canada Auctions), and Bryan McIntyre (Director, Commercial Sales, EBlock) on why the back office has become the front line of lending performance. The panel explored whether valuation tools are being over-relied on as “gospel,” how condition decay and transport costs are silently shaping loss severity, and why auction data—especially in a repo-heavy market—may be distorting front-end underwriting assumptions. Across recovery, inspection, and disposition perspectives, the takeaway was clear: recoveries are no longer just an operational afterthought; they are a strategic source of risk discovery, and lenders that fail to connect backend asset intelligence to front-end origination decisions are flying blind.

👉 Check out the full VIDEO here.

Erin Maloney: What we’ve heard repeatedly today is that the back office is now the front line. For decades, the industry operated on a very comfortable myth: that it’s easy to find the person, cheap to seize the car, and almost certain that you’ll collect your costs. But in this market, that myth has become an existential risk. We have to lend to recover, and recover to keep lending. If we can’t dispose of assets efficiently, we can’t afford to originate the next ones. So Taylor, let’s start with you. There’s a lot of talk about valuation tools being gospel. Is that actually the case? And what back-end data should be informing front-end origination decisions?

Taylor Bursey: Valuation tools are incredible, but they should be treated as a baseline—not gospel. The same goes for the car person’s instinct. A great car person can look at a vehicle, hear it, maybe even smell it, and know something is wrong. But they don’t necessarily know where that car is sitting, what the regional demand looks like, or what transport costs and buyer-pool dynamics are going to do to the final result.

That’s where backend data matters. On the recovery and remarketing side, our role is often seen as just logistics, but really what we do is determine loss severity. We get the vehicle, move the vehicle, and sell the vehicle, and every one of those steps has a financial consequence.

So yes, if you rely too heavily on generalized averages or on instinct alone, there’s a real chance you’re overleveraging certain assets. The better approach is to combine all three: valuation tools, human judgment, and backend remarketing data that can confirm or challenge those assumptions.

Erin Maloney: Gerry, one of the things you’ve talked about before is how distressed borrowers often stop doing even basic maintenance. You’re seeing these units hit the lanes in rough shape. Are there pieces of that condition decay that are not making it back to underwriting teams?

Gerry Johnson: Absolutely. A lot of the vehicles coming through are what I’d call peaches—and not in a good way. If someone stops making payments, odds are they’re also not doing oil changes, routine servicing, or anything else to keep that vehicle in shape.

That’s why we tell our customers: really look at the condition report. Look at the pictures. Look at the warning lights. We are your eyes and ears at the auction. Since COVID, a lot fewer reps are physically showing up to see these assets themselves, so we take that responsibility seriously.

We’ll send vehicles through the shop where it makes sense, we’ll try to clear codes, and we’ll document what we can. In some cases we even tell the lender, “You name your number and we’ll buy the car outright and handle the remarketing,” because what they often really need is liquidity. Get the asset in, get it out, redeploy the money somewhere else.

Erin Maloney: Bryan, building on that, auctions are often the only place where someone truly sees the asset at end of life. A lot of 2023 and 2024 vintages are already coming back in poor condition. How much origination risk is being created because that data isn’t flowing back quickly enough to underwriting teams?

Bryan McIntyre: A lot of it. In an indirect lending world, the lender may never have seen the vehicle at all. They’re completely reliant on the data they received at funding—and that obviously leaves room for misrepresentation on trim, VIN, condition, and everything else.

When the vehicle gets to auction, that’s often the first time anyone really touches it. That backend information does feed guidebooks and residual setting to some extent, but the issue is that a lot of the auction data in the last few years has been heavily skewed toward repossessed inventory. That means the “market” data everyone is looking at may actually be a view of the worst of the worst inventory.

I’ve seen cases where a lender wants a certain number for a ten-year-old Honda Civic with 300,000 kilometers on it because the borrower owes $30,000. But the market says it’s worth $8,100. The loan balance doesn’t matter anymore at that point. What matters is today’s market price.

That’s one of the hardest but most important lessons: don’t price recovery assets based on what someone owes or what the residual was four years ago. Price them based on what the lane is telling you today.

Erin Maloney: Let’s stay on pricing strategy for a second. Taylor, is there such a thing as overspending on polishing an asset for sale? Where’s the line between reconditioning and just taking the first money?

Taylor Bursey: Absolutely, there is such a thing as overspending.

At Copart, because of our origins in salvage and damaged vehicles, we know that there are plenty of units where extra spend simply won’t change buyer appetite. A damaged unit is still a damaged unit. If there’s structural or major mechanical damage, a cosmetic touch-up or extra polish isn’t going to move the final sale price enough to justify the cost.

The key is segmentation. Know your inventory and know your lane. Every auction provider has a niche. The real job is getting the right vehicle into the right lane with the right buyer audience. In some cases, you may take a slightly lower gross, but a stronger net because you sold it faster and avoided excess carrying cost.

There are definitely units worth reconditioning. But there are also units where “clean and first money” is the best decision.

Erin Maloney: Bryan, in our prep call you made an analogy to real estate—staging a home, doing a renovation, or just selling as-is because someone is going to tear it down anyway. Can you unpack that?

Bryan McIntyre: Sure. The point is that market value is always driven by real-time, local transactional data. Just like a house is worth what sold on that street in the last 30 days—not what some broad average says—the value of a vehicle is based on what buyers are actually paying in the lane right now.

That’s where auctions act a bit like real estate agents or home stagers. At the core of what we do, we put eyes on inventory and attract bidders. If we can clean the vehicle, remove dents, shampoo the seats, clean the engine bay, or otherwise make it look better, that can absolutely add value—especially if it builds buyer confidence.

OEMs and captives are usually more willing to spend a dollar to make a dollar because protecting residual value matters strategically. Banks can be more cautious because they may still be pursuing deficiency balances and need to justify every incremental dollar of spend. But there is enough data now to prove when that spend makes sense and when it doesn’t.

Taylor Bursey: And that’s where understanding the inventory really matters. If you’re looking at a total-loss or heavily damaged asset, don’t spend money you don’t need to spend. The whole point of the backend partner relationship is that we should be helping you know when to invest and when to walk away.

Cycle time matters too. Just like timing matters in real estate, it matters in remarketing. Knowing when to sell and in which market conditions can materially affect outcome. That’s why trusting your recovery and remarketing partners matters.

Erin Maloney: Gerry, Canada Auctions handles non-auto product too. Do you see different practices there, or is the strategy basically the same?

Gerry Johnson: It’s basically the same. Whether it’s auto or non-auto, we clean it, we photograph it, and we gather the information. We treat non-auto the same way we treat auto, because at the end of the day, clean product sells.

Whether it’s a house, a car, or a piece of equipment, if it looks good and presents well, you’ll usually generate more interest. If it’s dirty, caked in mud, or clearly neglected, you’re not going to get the same bidding or the same value.

Erin Maloney: What about pre-sale inspections? Do investments there make a meaningful difference?

Bryan McIntyre: Yes, they can. Most auctions are already doing visual and cosmetic inspections with lots of pictures, but going the extra mile with a true mechanical assessment adds another layer of confidence.

If you can tell the buyer that the car has been road-tested, that the transmission is fine—or that it isn’t—that helps them make a much more informed decision. That confidence can translate into stronger bidding and more repeat participation in your lanes.

It also reduces arbitration risk. If buyers trust that your condition reporting is thorough and reliable, they’ll show up more often and bid more confidently.

Taylor Bursey: But again, that’s not every unit. Some assets simply don’t warrant that spend. If a vehicle is fundamentally damaged enough that no buyer is going to value the extra insight, then a mechanical inspection may just be sunk cost. The point is to understand the type of asset you’re dealing with before you decide how much to invest.

Gerry Johnson: And beyond the confidence piece, inspections help lenders declare the vehicle properly. If we can tell you the engine is seized or the transmission is slipping, then you’re in a much better position to go back internally and say, “This car isn’t worth what we have in it.” It’s about giving you enough information so you can price the vehicle realistically.

Erin Maloney: Final question. Since COVID, a lot of clean fleet and lease-return inventory has stayed inside OEM and captive ecosystems, which means open auction lanes have become disproportionately repo-heavy. What’s the impact of that on lenders, and who’s most at risk when that hierarchy collapses?

Bryan McIntyre: It’s true. Coming out of the pandemic, repossessed assets still make up a big portion of what moves through open auction channels. We’re only now starting to see more lease returns, ex-rental, and cleaner fleet units come back in meaningful numbers.

That matters because if guidebooks and market participants are relying heavily on wholesale auction data, they need to remember what kind of data that actually is. If the market is being measured mostly through repo inventory, then the signal is going to skew toward the worst-performing units.

There’s also an interesting conflict inside dealerships themselves. The used car manager in the lane may be saying, “This car is only worth seven,” while the F&I office is asking for a stretch because they want the value to be ten or twelve. Those opposing incentives affect what data gets pushed back into the market.

So yes, the data source matters. We need to keep asking where the valuation inputs are coming from and what type of inventory is actually making up the benchmark.

Erin Maloney: So to wrap it up, recovery and remarketing are no longer an afterthought. If this data doesn’t make its way back to lenders, then underwriting and collections decisions are missing a critical piece of the picture. That means originations, recoveries, and residual strategy are all more connected than ever.

Here are 10 key insights from the panel:

The back office has become the front line
Recovery and remarketing now sit at the center of lending performance, not at the edge of it.

Valuation tools are a baseline—not gospel
Static tools and human instinct both have value, but neither should be used in isolation without backend market context.

Loss severity is shaped by logistics, transport, and buyer pool—not just book value
Where the asset is, how it moves, and who can bid on it all materially affect recovery outcomes.

Condition decay often starts long before recovery
Distressed borrowers frequently stop maintaining vehicles, which creates hidden value erosion that lenders may not fully see early enough.

Auction houses are often the only parties truly seeing the asset at end of life
That makes their reporting, inspections, and market feedback critical inputs into future underwriting and pricing.

Overspending on reconditioning is real
Some vehicles benefit from extra spend, but others are better sold quickly and as-is; segmentation matters.

Pre-sale inspections can materially improve buyer confidence
When done on the right units, deeper inspections can reduce arbitration risk and strengthen bidding.

Clean inventory still matters—even beyond auto
Across asset classes, presentation quality affects buyer interest and market outcome.

Repo-heavy lane data can distort residual assumptions
If market benchmarks rely too heavily on distressed inventory, lenders may be over- or under-estimating true front-end asset risk.

Recovery data needs to flow back into origination strategy
Without tighter feedback loops, lenders are making front-end decisions without a full view of backend value realization.