Serious Money: eBay should auction off eBay Motors

This is the second in a four part series which I hope gives buyers, sellers, shareholders and dare I say, management, a platform for discussion.

Now that I have unloaded Skype from eBay (NASDAQ: EBAY) in Tuesday's post (Serious Money: eBay should auction off Skype), it's time to move on to an asset that is not losing money, eBay Motors, but may be of more value to one of its competitors like Carmax (NYSE: KMX) or AutoNation (NYSE: AN).

It might also find a home with Amazon.com (NASDAQ: AMZN), its closest competitor in non-automotive categories. There is also the possibility that any number of auto-parts companies like AutoZone Inc (NYSE: AZO) or even the online car referral site Autobytel Inc. (NASDAQ: ABTL) would find eBay Motors a very compelling addition.

The Big Three American automakers might want to compete for this great asset. Since General Motors (NYSE: GM), Ford Motors (NYSE: F) and Chrysler are having difficulty selling new cars, expanding used car sales would be enticing. The problem is they are basically broke and holding on to a thread for dear life. That is not the case for Honda (NYSE: HMC) and Toyota Motor Corp. (NYSE: TM). Perhaps eBay Motors might find a place in their long term plans.

According to Intellichoice eBay Motors sells a car a minute by exposing seller offering to a very wide audience. I doubt any other opportunities can match that.

Which company might find higher value for eBay Motors?
Amazon.com14 (10.5%)
AutoNation or CarMax42 (31.6%)
AutoBytel5 (3.8%)
Auto Manufacturer7 (5.3%)
Auto Zone7 (5.3%)
eBay is still the best58 (43.6%)

If eBay stays intact then eBay Motors should remain, but if the company was split up then higher value might be found elsewhere. Should it stay or should it go?

Follow the story:

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares of EBAY.

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Last updated: February 09, 2012: 11:04 PM

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