From: Employee@MilVeh.com
Date: Tue May 13 2003 - 09:52:59 PDT
By ANNE MARIE SQUEO
Staff Reporter of THE WALL STREET JOURNAL
David Doyle likes 2-1/2-ton military trucks more than
most people do. The 41-year-old parks eight of these
12-wheeled vehicles, dating back to the Korean and
Vietnam wars, along the gravel driveway of his yellow,
five-bedroom house half an hour outside Memphis, Tenn.
"I have a tolerant wife and neighbors," he says,
noting the trucks predate his marriage. He takes them
apart, sandblasts the salvageable parts, replaces
rotted ones and drives the trucks in the mud with
dozens of friends who share his passion.
Lately, Mr. Doyle has been buying his trucks in one of
retailing's most unusual corners: the Pentagon's
online Web site for military surplus items. There, at
govliquidation.com, collectors bid for tugboats, steel
swords, big-screen televisions, diesel engines,
heavy-duty cranes, pool tables and other things the
military doesn't want.
For years, a little-known arm of the Pentagon called
the Defense Reutilization and Marketing Service, or
DRMS, handled public surplus sales. Buyers complained
that auctions were disorganized, used inconsistent
procedures and frequently required bidders to travel
hundreds of miles to raise a paddle in person.
In 2001, the Defense Department tapped a closely held
Washington company, Government Liquidation LLC, to
handle surplus sales at 200 military installations, as
part of a broader effort to operate more like a
private business. As part of a contract that lasts
until 2008, the Pentagon receives 80% of sale
proceeds, after Government Liquidation deducts its
costs. Government Liquidation gets the rest. The
government received about $18 million in 2002 as its
cut, up 50% from the previous year's proceeds when the
online auction system was getting started.
WHOA!
Recent sale items on Govliquidation.com
• 21 assorted valves for machinery: $3,709.99
• 50 pairs of black combat boots: $489.00
• Ford F-7000 utility truck with crane: On sale now
• Sundance and Joe, former U.S. Cavalry horses: $900
More than 10,000 items end up on the online auction
block each week, and about 3,000 new buyers sign up
monthly, says Bill Angrick, the company's president.
In recent auctions, a ship propeller 9-1/2 feet in
diameter sold in March for $1,520. A 15-foot one
snagged $6,210. The buyers had to be U.S. citizens and
send in a form saying what they planned to do with the
former Navy equipment.
A Consew sewing machine with old-fashioned foot pedals
ended up selling for $510 after the bidding began at
$35, as it does for most items. Four electric autopsy
bone-cutting saws fetched a total of $685 on March 4.
Two weeks ago, an aircraft hangar equipped with a
noise-suppression system, dubbed a "Hush House," sold
for $6,157 to Adams Electronics of Belton, Texas. The
hangar, which covered 5,318 square feet of ground, had
8-foot-thick filament walls and had been used by the
Kansas Air National Guard.
Users say the bidding can get contentious and last
long after previously set cutoff times. In November,
Mr. Doyle squared off against two dozen rivals over a
military truck located at the Aberdeen Proving Ground
in Maryland. Bidding opened at $35, a floor set by
Government Liquidation, at 6:20 a.m. on Nov. 13. By
the next morning, 15 auction-goers had bid up the
vehicle to $585. By the following afternoon, $1,650
was the price to beat. In the last two hours of
bidding, it was down to three people, including Mr.
Doyle, and the price had risen to $2,047. One person
dropped out and the remaining two pushed the final
price up to $2,410, with Mr. Doyle adding the truck to
his front-yard collection.
Most of Government Liquidation's regular customers are
small-business men such as Shawn Coleman. The owner of
a military-surplus store in Millersburg, Pa., about 25
miles north of Harrisburg, Mr. Coleman also has a
mail-order business and a Web site and conducts about
200 eBay auctions a week to sell his wares. He once
made 30 trips a year to attend auctions, but now he's
down to three or four because he does most of his
bidding online these days.
What he buys ranges from restaurant equipment that
comes from old mess halls to cold-weather gear such as
boots and snowshoes. Mr. Coleman, 37, does a brisk
business selling military tents, as well as military
clothing. He recently bought 108 U.S. Army gray-hooded
sweatshirts online, for $261. He sells them on his Web
site for $14.95 each.
He has also found an interesting niche for some of his
stuff: the military itself. A big buyer of parts for
older aircraft, tanks and ships, he reckons he sells
something back to a military facility about once a
month. "I don't think they expect to need an item and
then something changes, so it's cheaper for them to
buy it back from people like me than to start
manufacturing it again," he explains. He recently
bought some bearings for a C-130 military transport
plane for $50 each, and sold some back to the
government for $60. The military is increasingly using
equipment far longer than originally planned, as it
diverts spending to newer aircraft, ships and vehicles
not yet in the field.
DRMS officials point out that warehousing racks of
spare parts costs money, too. Mr. Coleman, for
example, says he has a few hundred thousand parts in
his possession. So while he gets to mark up the price
to the government for something it sold in the first
place, Tom Legeret, deputy of business operations at
DRMS, points out: "There's an awful lot these folks
buy that we never want back."
Included in that category would be aging cavalry
horses. Last June, Marion Smith paid $900 for a pair
of 21-year-old quarter horses called Sundance and Joe.
While the U.S. eliminated cavalries in the 1940s, the
1st Cavalry Division at Fort Hood, Texas, remains
active, though its job these days centers on
presidential inaugurations, Rose Bowl parades and the
like. But the horses held sentimental value for Mr.
Smith, who has purchased military equipment over the
years and often donated it to local charities.
Mr. Smith, 57, an audio-visual engineer, is a softie
for sick animals. At his farm in Murfreesboro, Tenn.,
about 30 miles south of Nashville, he already has two
blind cows, a horse with a broken ankle and some
llamas. Sundance, who is blind in the left eye, and
Joe, who has arthritis, fit in well. Mr. Smith's
13-year-old daughter, who wants to be a veterinarian,
cares for the menagerie.
But Mr. Smith's main motivation was his 86-year-old
dad. "My father was in the cavalry in 1942 when they
discharged all the horses, taking them to Nevada and
turning them loose," he recalls. So he bought the
horses as a surprise and arranged for the truck
delivering them from Texas to stop by his dad's house
on the way. "He cried," says Mr. Smith. "It just
thrilled him to tears."
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