Like many companies, Philips Medical Systems tried to sell its used corporate vehicles to employees before resorting to dealer auctions. That proved difficult in 2001: Detroit car makers were offering zero percent financing and "there were literally thousands of rental cars on the market after the 9/11 tragedies," says Gage Wagoner, fleet manager at the Bothel, Wash.-based division of Royal Philips Electronics.
To solve the inventory problem, Wagoner and two other Philips executives approached Alpharetta, Ga.-based fleet-management firm LeasePlan USA Inc. to devise a tool — similar to eBay Motors — that sold cars to employees. And this spring, ReDrive, a partnership between LeasePlan and software maker Driveitaway.com Inc., began marketing Philips's cars internally in real time, with the potential of saving the company — and its employees — hundreds of dollars per vehicle.
ReDrive allows Philips to post vehicles on a customized Website 6 to 12 weeks before they come off lease. Included is information about the car's condition, financing availability, and delivery. But Wagoner concedes that "the biggest challenge is raising [employees'] comfort level about buying a car they've never seen."
The benefit to the company "lies in the gap between the retail and the wholesale price," says Bryan Calloway, senior vice president of marketing at LeasePlan, who adds that the difference averages $1,500 per car. The company can then pass on that savings to its employee customers. And companies broaden their buyer pool exponentially by offering vehicles to employees, says Driveitaway president George Muller. "Previously," he says, "the technology wasn't available to aggregate such a large number of buyers and vehicles."
Now if they can just do something about the price of gasoline.