Tag: auto
Beginning with the birth of stock muscle cars, like the Pontiac GTO, vehicles with powerful V8 engines permeated the roads in the 1960s. Given consumers’ “need for speed,” these vehicles were synonymous with American culture following World War II - some going as far as to call muscle cars as American as apple pie. It’s no doubt that these vehicles have made an undeniable lasting impression on the automotive industry. Today, there are still automotive enthusiasts who appreciate the style and strength of the muscle car, but most of us want practical vehicles with better fuel economy and easy maintenance. This has resulted in a dramatic increase in the volume of 4-cylinder vehicles on the road. As seen in the graphic above, over the last 11 years, 4-cylinder engines have increased in volume over 55%, 6-cylinder have declined 4% and 8-cylinders have increased 9.8%. More power, smaller engines This trend doesn’t necessarily mean that those of us who elect for a smaller engine size aren’t able to satisfy our need for speed. Horsepower has received a significant boost over the past two decades. This has been partially driven by EPA guidelines, as manufacturers have implemented engine enhancements to increase gas mileage to meet the guidelines, resulting in higher horsepower. 4-cylinder engines have as much horsepower today as 6-cylinder engines had in 2003. That gives today’s drivers a lot more pep in engine performance. Similarly, today\'s 6-cylinder engines have nearly the same horsepower today that V8s had in 2009. Where does that leave true muscle car enthusiasts? Well, if you are looking for raw power, things are looking up. In 2018, V8 engines averaged a whopping 370.4 horsepower, nearly double V8 output of 204 horsepower in 1999. Those who buy V8s today have power to burn. Above chart detailing percentage of total volume count and average vehicle MAX HP over history. The automotive market is driven by consumer preferences and offers a range of engine options, which provides something for everyone. The boost in horesepower in today’s engines provides a nice mix of fuel economy and performance. While muscle cars remain an important fixture in American society and automotive culture, demand has shifted and understanding these data points in the broader industry context empowers dealers to make the right inventory decisions. To learn more about the latest automotive trends impacting the marketplace, view the full Q4 2018 Automotive Market Trends Analysis.
When it comes to new vehicle registration, there is one segment that stands out from the pack: crossover vehicles. According to Experian’s Q4 2018 Automotive Market Trends Analysis, over the last four years, crossovers (CUVs) have spiked in popularity, representing about a third of new vehicle registrations in 2014 (34.1 percent), but growing to nearly half the new vehicle market in 2018 (47.6 percent). In fact, the large growth in CUVs isn’t limited to just the last four years – there was a large volume of growth year-over-year compared to 2017; the share has grown nearly 4 percent. Sedans and hatchbacks, meanwhile, have seen their share decrease year-over-year. The charts below detail this change in market, based on Experian’s latest 2018 quarterly findings. Source: Experian Automotive VIO as of December 31, 2018 (light duty registered vehicles only) What’s driving this growth? Across the board, the number of light-duty vehicles on the road continues to increase, up to 275.3 million in the U.S. market, at the end of 2018, compared to 271.4 million a year prior. The growth in CUVs isn’t entirely unprecedented, as it’s been going on for a number of years. CUVs continue to grow in popularity for a variety of reasons including: Greater visibility, as the driver sits higher than in a sedan/coupe Larger storage capacities for passengers or cargo Number of varieties available, such as size, engines, and manufactures Higher fuel efficiency than a full-size SUV or minivan Currently, there are over 130 different CUV/SUV Make/Model combos offered, and of those, the different engines, options, etc. drive that volume even higher. Source: Experian Automotive VIO as of December 31, 2018 (light duty registered vehicles only) Potential for growth Currently, there are only two CUVs among the top vehicles in the aftermarket “sweet spot.” Vehicles in the sweet spot are 6 to 12 model years old, and typically aged out of general OEM warranties for any repairs. These vehicles likely require more part replacement services, which may be performed by aftermarket service shops using parts from aftermarket part manufacturers. According to Experian data, the sweet spot has stopped falling and has settled for now. But, there is expected growth of the number of vehicles that fall into the sweet spot over the coming years. One of the segments where the aftermarket industry can begin to focus on will be CUVs. Source: Experian Automotive VIO as of December 31, 2018 (light duty registered vehicles only) The aftermarket can use this data to make more informed product decisions, specifically, around the high volume of CUVs expected to come into the sweet spot. With the number of vehicle options available on the market today, CUVs will continue to stand out as a segment to watch within the auto industry. There’s a greater story beyond the numbers and understanding how to leverage the data at hand can provide the industry with a greater understanding of CUVs and its potential for even greater growth. To learn more about CUVs/SUVs and total vehicles in operation, view the full Q4 2018 Automotive Market Trends Analysis.
There’s recently been a significant amount of discussion about the stability of the automotive finance industry. Many fear the increase in the volume of delinquent U.S. automotive loans may be an early stage harbinger of the downfall of the automotive industry. But, the fact is, that’s not entirely true. While we certainly want to keep a close eye on the volume of delinquent loans, it’s important to put these trends into context. We’ve seen a steady increase in the volume of outstanding loan balances for the past several years – though the growth has slowed the past few quarters. And while much of the increase is driven by higher loan amounts, it also means there’s been an overall higher volume of vehicle buyers leaning on automotive lenders to finance vehicles. In fact, findings from our Q4 2018 State of the Automotive Finance Market Report show 85.1 percent of all new vehicle purchases were financed in Q4 2018 – compare that to 81.4 percent in Q4 2010 and 78.2 percent in Q4 2006. Suffice it to say, more financed vehicles will undoubtedly lead to more delinquent loans. But that also means, there is a high volume of car buyers who continue to pay their automotive loans in a timely manner. Through Q4 2018, there were nearly 86 million automotive loans and leases that were in good standing. With a higher volume of automotive loans than in the past, we should pay close attention to the percentage of delinquent loans compared to the overall market and compare that to previous years. And when we examine findings from our report, the percentage of automotive loans and leases that were 30-days past due dropped from 2.36 percent to 2.32 percent compared to a year ago. When we look at loans and leases that were 60-days past due, the percentages are relatively stable (up slightly from 0.76 percent to 0.78 percent compared to a year ago). It’s worth noting, these percentages are well below the high-water mark set during Q4 2009 when 3.30 percent of loans were 30-days delinquent and 0.94 percent of loans were 60-days delinquent. But, while the rate of delinquency is down and/or relatively stable year-over-year, it has trended upward since Q4 2015 – we’ll want to stay close to these trends. That said, much of the increase in the percentage of 60-day delinquent automotive loans is a result of a higher percentage of deep subprime loans from previous years – high-risk originations that become delinquent often occur more than 16 months after the origination. Additionally, the percentage of deep subprime originations has steadily decreased over the past two years, which could lead to a positive impact on the percentage of delinquent automotive loans. Despite rising automotive loan amounts and monthly payments, the data shows consumers appear to be making their payments on-time – an encouraging sign for automotive lenders. That said, lenders will want to continue to keep a close eye on all facets of car buyers’ payment performance moving forward – but it is important to put it into context. A clear understanding of these trends will better position lenders to make the right decisions when analyzing risk and provide consumers with comprehensive automotive financing options. To learn more about the State of the Automotive Finance Market report, or to watch the webinar, click here.
A closer look at the data shows GM’s losses might not be particularly significant, despite the announcement of discontinued models.
Experian Boost gives consumers greater control over their credit profiles by allowing them to add non-traditional credit information to their Experian credit file.
Today, we’re excited to announce that AutoCheck® has received a facelift! AutoCheck has always been the industrial strength Vehicle History Report that automotive professionals trust to help manage risk and confidently buy and sell the right vehicles. We’ve made this great tool even greater by adding more data and accident insights than ever before and improving the user experience by making it easier to read across all mobile devices. Among the data and insights updated within AutoCheck: Updated display of how buyback protection details are presented Vehicle ownership history presentation Vehicle use history details Updated accident and damage check sections Updated display of how title brand information is displayed Updated odometer check Open safety recall information, inspection, service and repair history checks Based on extensive research, we’ve added many visual changes which make it easier for dealers and cars shoppers to understand and use the full report. One noticeable change is the addition of the Experian logo and color scheme. Experian continues to invest significantly in building a widely recognized and trusted brand. Reinforcing that AutoCheck is backed by Experian’s rich data and industry expertise will resonate with consumers as they look for a trusted source to confidently move along their vehicle shopping journey. The AutoCheck Score® has a new visualization, designed after an automotive-themed gauge to illustrate if the vehicle’s AutoCheck Score is below, within or above the score range for similar vehicles. Making the score easier to use and understand will help consumers better compare their vehicle to other similar vehicles currently in the market. We’ve also made the report easier to use and access for both consumers and dealers. AutoCheck is now optimized for tablet and mobile users, providing even more shopping convenience for users. As always, dealers can access the new report via AutoCheck Fast Link℠ for their online vehicle listings and through multiple integrations within their DMS or inventory management solution. The report will still be available directly from AutoCheck.com for consumers and AutoCheck.com/members for dealers. In addition, the report is available through most dealer platforms and all premier consumer automotive portals. Check out the full report redesign changes, updates and some additional highlights below. Updated AutoCheck® Buyback Protection Information As always, AutoCheck will buy back your vehicle if your AutoCheck report fails to list certain title brands available to Experian at the time the report was issued. Items impacting Buyback protection are now grouped together, so users can clearly see what data impacts Buyback qualification. Items that do not impact Buyback are captured in other areas of the report. Buyback Protection badging for eligible clients displays on the first page as well as in the specific State Title Brand section if the vehicle is, or is not, Buyback protected. NEW: Owner History AutoCheck now displays information for the current, last and previous vehicle ownership. The report will now highlight the year and state the vehicle was purchased from as well as the ownership date ranges and length of ownership. NEW: Vehicle Usage AutoCheck now clearly highlights the historical usage activity level for the vehicle, whether it was used as Personal, Fleet, Rental, Lease, Taxi, Livery, Police, Government, Drivers Ed and/or Commercial. NEW: Damage Check Section We have added a new Damage Check section to more clearly illustrate the historical activity for the vehicle. The Damage Check section will highlight damage records from auctions, salvage, or independent sources such as recycling and crash tests. We will continue to offer the Accident Check section, which highlights accident dates and location from government sources and independent agencies. The Damage Check section will highlight damage records from auctions, salvage auctions or independent sources such as recycling and crash tests. Other Title Brand and Specific Event check: Other title brands that are not included in Buyback protection qualification will be listed here. In addition, event activity such as theft and insurance loss is also included in this section. UPDATED: Odometer Check We have combined information to provide one place for all odometer related history checks. State title odometer check reflects all odometer related brands from the state such as Exceeds Mechanical Limits (EML), Not Actual Mileage (NAM) and Broken Odometer (BRK). Auction odometer check are the odometer brands either reported to auctions or upon inspection in auction announcements. The odometer calculation check is Experian’s proprietary odometer sequence calculation to determine if there are any potential discrepancies. NEW: ‘Check’ sections: To highlight specific data for easier reference and understanding, we have added an open safety recall check, Inspection history check, and service and repair history check section. What do all these changes mean for dealers and their customers? They have an easier-to-use AutoCheck VHR with more comprehensive information than ever. For dealers, it will help with their buying decisions at auction or on trade-ins. For consumers, it provides even more peace of mind when making a used vehicle purchase decision. Ultimately, it improves the shopping process for everyone involved and can help dealers develop even stronger relationships with their customers. Want to learn even more about AutoCheck? Visit our site for more details: https://www.experian.com/lp/automotive/autocheck-dealer-lp
Subprime originations hit the lowest overall share of the market seen in 11 years, but does that mean people are being locked out car ownership? Not necessarily, according to the Q3 State of the Automotive Finance Market report.To gain accurate insights from the vast amount of data available, it’s important to look at the entire picture that is created by the data. The decrease in subprime originations is due to many factors, one of which being that credit scores are increasing across the board (average is now 717 for new and 661 for used), which naturally shifts more consumers into the higher credit tiers. Loan origination market share are just one of the trends seen in this quarter’s report. Ultimately, examining the data can help inform lenders and help them make the right lending decisions. Exploring options for affordability While consumers analyze different possibilities to ensure their monthly payments are affordable, leasing is one of the more reasonable options in terms of monthly payments. In fact, the difference between the average new lease payment and new car payment usually averages more $100—and sometimes well over—which is a significant amount for the average American budget. In fact, leases of new vehicles are hovering around 30 percent, which is one of the factors that is aiding in new car sales. In turn, this then helps the used-vehicle market, as the high number of leases create a larger supply of quality use vehicles when they come off-lease and make their way back into the market. On-time payments continue to improve As consumer preferences continue to trend towards more expensive vehicles, such as crossovers, SUVs, and pickups, affordability will continue to be a topic of discussion. But consumers appear to be managing the higher prices, as in addition to the tactics mentioned above, 30- and 60-day delinquency rates declined since Q3 2017, from 2.39 percent to 2.23 percent and 0.76 percent to 0.72 percent, respectively. The automotive finance market is one where the old saying “no news is good news” continues to remain true. While there aren’t significant changes in the numbers quarter over quarter, this signals that the market is at a good place in its cycle. To learn more about the State of the Automotive Finance Market report, or to watch the webinar, click here.
There are four reasons why the auto industry should be enthusiastic about the electric vehicle segment’s future.
Where are electric vehicles most popular? During the first half of the year, 3.6 percent of all new registrations in California were EVs.
While electric vehicles remain a relatively niche part of the market, with only 0.9 percent of the total vehicle registrations through June 2018, consumer demand has grown quite significantly over the past few years. As I mentioned in a previous blog post, electric vehicles held just 0.5 percent in 2016. Undoubtedly, manufacturers and retailers will look to capitalize on this growing segment of the population. But, it’s not enough to just dig into the sales number. If the automotive industry really wants to position itself for success, it’s important to understand the consumers most interested in electric vehicles. This level of data can help manufacturers and retailers make the right decisions and improve the bottom line. Based on our vehicle registration data, below is detailed look into the electric vehicle consumer. Home Value Somewhat unsurprisingly, the people most likely to purchase an electric vehicle tend to own more expensive homes. Consumers with homes valued between $450,000-$749,000 made up 25 percent of electric vehicle market share. And, as home values increase, these consumers still make up a significant portion of electric vehicle market. More than 15 percent of the electric vehicle market share was made up by those with homes valued between $750,000-$999,000, and 22.5 percent of the share was made up by those with home values of more than $1 million. In fact, consumers with home values of more than $1 million are 5.9 times more likely to purchase an electric vehicle than the general population. Education Level Breaking down consumers by education level shows another distinct pattern. Individuals with a graduate degree are two times more likely to own an electric vehicle. Those with graduate degrees made up 28 percent of electric vehicle market share, compared to those with no college education, which made up just 11 percent. Consumer Lifestyle Segmentation Diving deeper into the lifestyles of individuals, we leveraged our Mosaic® USA consumer lifestyle segmentation system, which classifies every household and neighborhood in the U.S. into 71 unique types and 19 overachieving groups. Findings show American Royalty, who are described as wealthy, influential couples and families living in prestigious suburbs, led the way with a 17.8 percent share. Following them were Silver Sophisticates at 11.9 percent. Those in this category are described as mature couples and singles living an upscale lifestyle in suburban homes. Rounding out the top three were Cosmopolitan Achiever, described as affluent middle-aged and established couples and families who enjoy a dynamic lifestyle in metro areas. Their share was 10.1 percent. If manufacturers and retailers go beyond just the sales figures, a clearer picture of the electric vehicle market begins to form. They have an opportunity to understand that wealthier, more established individuals with higher levels of education and home values are much more likely to purchase electric vehicles. While these characteristics are consistent, the different segments represent a dynamic group of people who share similarities, but are still at different stages in life, leading different lifestyles and have different needs. As time wears on, the electric vehicle segment is poised for growth. If the industry wants to maximize its potential, they need to leverage data and insights to help make the right decisions and adapt to the evolving marketplace.
Electric vehicles are here to stay – and will likely gain market share as costs reduce, travel ranges increase and charging infrastructure grows.
In the aftermath of Hurricane Florence, Experian is here to help. As a first line of defense against purchasing a flood-damaged vehicle, people can download our free Vehicle Flood Risk Check app.
Trivia question: Millennials don’t purchase new vehicles. True or False?
When it comes to driving the automotive industry forward, Experian Automotive has a motto: “The right cars. The right customers. The right data to know the difference.” We deliver an integrated perspective based on the highest quality automotive information and market intelligence. Data is important to us, and we have the most robust combination of data assets under one roof. The North American Vehicle Database℠, File One℠ Credit Database, Consumer View℠ Marketing Database, Online Activity Databases, and National Fraud Database℠ all fed into Experian’s Auto HyperConnect™. Auto HyperConnect houses two different solutions: Auto HyperTargeting™ and Auto HyperMonitoring™. There are four different components to Auto HyperTargeting, and the one we will focus on today is Expired Lease. Dealers have found success marketing to their own customers when vehicle leases come due. The challenge has been conquesting off-lease consumers who didn’t buy from them. While off-lease consumer marketing lists are available, they only provide the estimated lease end date and monthly lease payment. When restricted to this data, it’s hard to tell if a $550 a month payment is for a Ford F150 or a BMW 3-series. And yet this is exactly the level of detail needed to successfully target off-lease marketing. Experian’s new Auto HyperTargeting- Expired Lease addresses this challenge by enabling dealers to identify and engage off-lease audiences through a highly targeted approach that has never been possible! Now, finding customers is much easier and cost-effective. You can use the best mix of selection criteria to maximize your off-lease conquesting strategy. Some of the ways you can identify your audience are: Lease Maturity Date Vehicle Make Vehicle Model Zip Code Model Performance Tier Distance from Dealer Ship Vehicle Status (New or Used) Signing up for Auto HyperTargeting- Expired Lease comes with five perks. The first is a monthly file. This includes name and address, lease maturity date, make/model, monthly payment bands, and phone and email address when available. The second is the ability to make sign up for a subscription monthly payments. Third is marketing flexibility with direct mail, email, and phone. Four there is no firm offer of credit required for this. Finally, a quarterly sales report. ARA reports provide sales metrics industry wide for your targets. Other competitive features also available in Auto HyperTargeting- Expired Lease is the customers full contact information with name, address, email address and phone number. And for online and offline channels, you can select a specific audience that is customizable. Auto HyperTargeting has some amazing features to successfully conquest customers, and Expired Lease is one of the four ways to do this. Stay tuned for Auto HyperTargeting- Vehicle Owners coming up next!
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