How Transportation Costs Affect Auction Buying Decisions

Written by

Elise Borngesser

Published on

October 21, 2025

Auctions are no longer local-only plays. With digital bidding and nationwide sourcing, dealers have more options than ever. A manager in Michigan can buy from Dallas, Denver, or Daytona with a few clicks. The boundaries are wide open.

Transportation cost is a big factor that affects your buying decisions at an auction. Freight determines which auctions make sense, which vehicles are worth chasing, and how much gross you can safely protect.

Thinking “transport is expensive” might mean you’re overlooking some opportunities to pick up units at auction where the margins actually do pencil out. Let’s take a deeper look at specific ways freight reshapes buying strategy: seasonality, vehicle mix, and margin modeling.

Seasonal Lane Costs Can Flip the Math

Transport isn't a fixed price all year long. It’s seasonal, lane-based, and tied to carrier availability.

Florida lanes during snowbird season. As retirees migrate south, carriers fill up and lane rates climb. A route that made sense in the summer can destroy margin in the winter. At the same time, trucks might be deadheading on the way out of Florida during the winter, so sourcing vehicles from Florida might make sense in the winter.
Northern tier in winter. Weather delays and tighter capacity mean fewer available trucks, higher rates, and longer delivery times.
Holiday crunch periods. Late-year surges tighten nationwide trucking capacity and push auto transport prices higher.

For buyers, this means the same auction can be viable one quarter and too costly the next. Smart dealers keep track of seasonal freight changes. They time their sourcing from certain regions based on the transportation costs.

High-Margin Vehicles Can Travel Further

Sometimes the obvious must be stated. And, obviously, the more margin that is available in a vehicle, the more budget is available for transporting the vehicle from further away.

A $12,000 sedan with $1,500 in expected gross margin can’t carry $1,000 worth of transport. By the time recon, overhead, and floorplan interest stack on top, the deal is upside down.

By contrast, a $50,000 SUV with $5,000 in gross margin can still deliver healthy profit even after a 1,000-mile haul. The same goes for EVs, rare trims, or region-specific models that aren’t available locally.

The takeaway is simple. The more margin a unit has, the more distance you can safely chase it. When sourcing decisions are made, the question isn’t just “do we want this vehicle?” It’s “can this vehicle justify the freight?”

To help answer that question, we put together a reference table based on distance and margin.

A Quick Reference for Distance vs. Margin

It’s one thing to talk about freight in the abstract. It’s another to see how it cuts into gross. Here’s a simple model that blends:

Estimated transport cost (based on distance),
Recon + overhead (assumed $900 flat per unit),
Floorplan interest (assumed 7% APR, 45-day hold plus transit days).

Together, these numbers show the gross margin required at different price points to make the buy worthwhile:

Distance	Est. Transport Cost	Transit Days Added	Recon + Overhead	Req. GM @ $12k Sale	Req. GM @ $25k Sale	Req. GM @ $50k Sale
100 mi	$125	+1	$900	$1,131	$1,246	$1,466
300 mi	$375	+2	$900	$1,383	$1,500	$1,726
600 mi	$750	+3	$900	$1,760	$1,880	$2,110
1,000 mi	$1,250	+4	$900	$2,263	$2,385	$2,620

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How to use it:

If you’re targeting $2,500 in gross on a $25,000 SUV, a 1,000-mile buy still works.
If your expected margin on a $12,000 sedan is $1,500, the safe sourcing radius is closer to 300 miles.

This isn’t a perfect formula since recon and financing terms vary, but it highlights the right thinking. Every bid should account for freight before it leaves the lane.

Switching Away From Brokers Means Some Auctions Deserve a Second Look

Some dealers may have written off specific auctions because the math never worked with brokers. They weren’t wrong:

Broker markups average 20–30%, inflating freight cost before the first mile is driven.
Delivery times stretch 14–16 days on average means higher floorplan interest costs.
Hidden costs multiply: more auction storage fees, more floorplan interest, and greater risk of missing arbitration windows.

So, even if the unit itself looked profitable, the cost of logistics killed the deal.

But, here’s the thing. Marketplaces change the cost equation. Dealers using AHX save an average of 25-30% on transportation. If you want to see how that’s possible, check out our in-depth breakdown on the costs to factor in for vehicle transportation.

The main reason behind the savings are because on Auto Hauler Exchange, dealers connect directly with vetted carriers, so pricing is transparent. Also, delivery averages less than a week since no one is negotiating against both sides, slowing the process down like brokers do. With faster delivery times, you’re spending less on floorplan interest costs.

Auctions that didn’t pencil out with broker costs in the past may suddenly be back on the map.

AHX as a Competitive Edge

The best buyers treat freight as a factor in their bidding process, not an afterthought. They know which lanes are overpriced in certain seasons, which vehicles justify long hauls, and which auctions to revisit now that marketplace economics are replacing more expensive brokers.

Transportation will always be a cost. But for disciplined buyers, it can also be an advantage as a way to buy smarter, expand sourcing radius, and win deals competitors can’t touch.