Northern Nevada's construction industry may be flagging, but some growing economies worldwide contributed significantly to big numbers at a heavy construction equipment auction at Patrick, along Interstate 80 east of Sparks.
Ritchie Bros. Auctioneers took in more than $20 million during a one-day auction attended in person by several hundred bidders, with many more people bidding online for a seemingly endless line of backhoes, loaders, tractors, graders, excavators and other heavy machinery.
International bidders accounted for 30 percent of gross proceeds, or about $6 million, while nearly half the day's bidding 42 percent came from the Internet.
Mike Brenner, the Ritchie Bros. territory manager for northern Nevada, says the publicly traded company with international headquarters in Vancouver expected aggressive online bidding. At recent auctions, 25 percent or more of the bidding has come online.
"It just shows what the world economy is doing," Brenner says. "There are still growth markets and emerging markets in the world economy that are doing well. There are other areas of the world that have growth and are building."
Brenner says international bidders typically contract with trucking companies to haul their newly purchased equipment to the nearest port, where it is loaded into containers for shipment. All buyers have two weeks after the Oct. 3 auction to remove their equipment from the temporary site in Patrick.
Much of the equipment that was auctioned came on consignment from northern Nevada construction companies that have scaled back their fleets in the wake of the building downturn. Among the sellers were
F&P Construc-tion, Sierra Nevada Construction and Q&D Construction.
Some equipment also was hauled over the Sierra from sites in northern California, although Ritchie Bros. keeps a permanent auction yard in the farming town of Dunnigan about 50 miles north of Sacramento.
"This was a very good sale for buyers and for our consigners," Brenner said. "The types of equipment and quality were very good. The items people in northern California had to sell paired well with what we were already selling in the auction, and it was in their best interest to bring it over the hill to sell it."
Most of the equipment will be leaving the state. Ritchie Bros. Regional Manager Mike Johnston said more than 80 percent of buyers were from outside Nevada.
"That is a pretty staggering number," Johnston said.
The $20 million gross on 623 pieces of heavy machinery was the largest auction Ritchie Bros. has conducted in northern Nevada. An auction in June of 2007 generated $5 million in gross sales. Ritchie Bros. earns a percentage of each transaction, but its take varies depending on the type of equipment and amount of marketing put into pre-sale activities.
"We were extremely pleased with the prices on auction day, especially given the current economic
uncertainty in the United States and the quiet construction market in northern Nevada," said Johnston.
"There definitely were some ups and down. Some specific categories of equipment were softer than expected, while other categories were at or exceeded expectations."
Despite the regional construction slowdown, Brenner says Ritchie Bros. has not seen a flood of consignment equipment headed for auction.
"Our numbers have been pretty consistent," he says. "When the building boom was going on we saw a large amount (of activity) then because many contractors were upgrading, buying newer equipment with lower hours. When things are slow they thin their fleets out and prepare for a slower time."
