Tag: auto trends

Experian’s Q4 2020 Market Trends Review takes a closer look at aftermarket trends, including the growing sweet spot.

The early assessment for the automotive industry is that despite significant challenges at the onset of the pandemic, the industry continues to rebound.

Essential personnel and organizations are working tirelessly to deliver food and other resources, not to mention, protecting the health and safety of those around us. These vehicles still require proper maintenance and care to ensure they run smoothly. That’s where the automotive industry can help.

Update: After closely monitoring updates from the WHO, CDC, and other relevant sources related to COVID-19, we have decided to cancel our 2020 Vision Conference. If you had the chance to experience tomorrow, today, would you take it? What if it meant you could get a glimpse into the future technology and trends that would take your organization to the next level? If you’re looking for a competitive edge – this is it. For more than 38 years, Experian’s premier conference has connected business leaders to data-driven ideas and solutions, fueling them to target new markets, grow existing customer bases, improve response rates, reduce fraud and increase profits. What’s in it for you? Everything to gain and nothing to lose. Are you a marketer? These sessions were made to drive your conversion rates to new heights: Know your customers via omnichannel marketing: Your customers are everywhere, but can you reach them? Learn how to drive business-expansion strategy, brand affinity and customer engagement across multiple channels. Plus, gain insight into connecting with customers via one-to-one messaging. By invitation only, the future of ITA marketing: An evolving landscape means marketers face new challenges in effectively targeting consumers while staying compliant. In this session, we’ll explore how you can leverage fair lending-friendly marketing data for targeting, analysis and measurement. Want the latest in technology trends? Dive into discussions to transform your customer experience: Credit in the age of technology transformation: Machine learning and artificial intelligence are the current darlings of big data, but the platform that drives the success of any big data endeavor is crucial. This session will dive into what happens behind the curtain. Put away your plastic – next-generation identity: An industry panel of experts discusses the newest digital identity and authentication capabilities – those in use today and also exciting solutions on the horizon. How about for the self-proclaimed data geeks? Analyze these: Alternative data: Listen in on an in-depth conversation about creative and impactful examples of using emerging data assets, such as alternative and consumer-permissioned data, for improved consumer inclusion, risk assessment and verification services. The next wave in open data: Experian will share their views on the potential of advanced data and models and how they benefit the global value chain – from consumer scores to business opportunities – regardless of local regulations. And the risk masters? Join us as we kick fraud to the curb: Understanding and tackling synthetic ID fraud: Synthetic IDs present a serious challenge for our entire industry. This expert panel will explore the current landscape – what’s working and what’s not, the expected impact of the next generation SSA eCBSV service, and best practice prevention methods. You are your ID – the new reality of biometrics: Consumers are becoming increasingly comfortable with biometrics. Just as CLEAR has transformed how we use our biometric identity to move through airports, sports venues and more, financial transactions can also be made friction-free. The point is, there’s something for everyone at Vision 2020. It’s not just another conference. Trade in stuffy tradeshow halls and another tri-fold brochure for the insights and connections you need to take your career and organization to the next level. Like technology itself, Vision 2020 promises to connect us, unify us and enable us all to create a better tomorrow. Join us for unique networking opportunities, one-on-one conversations with subject-matter experts and more than 50 breakout sessions with the industry’s most sought-after thought leaders.    

Vehicle affordability has been a main topic of conversation in the auto industry for some time, and based on the data, it’s not going unnoticed by consumers. The average new vehicle loan in Q1 2019 reached $32,187, while the average new vehicle monthly loan payment hit $554. How are car shoppers reacting? Perhaps the biggest shift in Q1 2019 was the growth of prime and super prime customers opting for used vehicles. The percentage of prime (61.88 percent) and super-prime (44.78 percent) consumers choosing used vehicles reached an all-time high in Q1 2019, according to Experian data. Not only are we seeing new payment amounts increase, but used loan amounts and payments are on the rise as well, though the delta between the two can be one of the reason we’re seeing more prime and super prime opt for used. The average used vehicle loan was slightly above $20,000 in Q1 2019, while the average used vehicle payment was $391. We know that consumers often shop based on the monthly payment amount, and given the $163 difference between average monthly payments for new and used, it’s not surprising to see more people opt for used vehicles. Another way that consumers can look to have a smaller payment amount is through leasing. We’re continuing to see that the top vehicles leased are more expensive CUVs, trucks and SUVs, which are pricier vehicles to purchase. But with the average lease payment being $457 per month, there’s an average difference of $97 compared to loan payments. In Q1 2019, leasing was down slightly year-over-year, but still accounted for 29.07 percent of all vehicle financing. On the other side of the affordability equation, beyond cost of vehicles, is concern around delinquencies: will consumers be able to make their payments in a timely manner? So far, so good. In Q1 2019, 30-day delinquencies saw an increase to 1.98 percent, up from 1.9 percent a year ago. That said, banks, credit unions and finance companies all saw slight decreases in 30-day delinquency rates, and 60-day delinquencies remained relatively stable at 0.68 percent year-over-year. It’s important to keep in mind that the 30-day delinquency rate is still well-below the high-water mark in Q1 2009 (2.81 percent). The vehicle finance market appears to remain strong overall, despite rising vehicle costs, loan amounts and monthly payments. Expect consumers to continue to find ways to minimize monthly payments. This could continue the shift into used vehicles. Overall, as long as delinquencies stay flat and vehicle sales don’t taper too badly, the auto finance market should stay on a positive course. To watch the full Q1 2019 State of the Automotive Finance Market webinar, click here.

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.

Experian’s 38th annual Vision Conference kicks off on Sunday, May 5 in San Antonio, Texas. The sold-out thought leadership conference, is known for driving discussions on the industry’s hard-hitting topics as well as introducing the latest and greatest in technology, innovation and data science. “For 38 years, Experian’s Vision Conference has connected business leaders to new ideas and solutions through cutting edge data and insights. Our goal is to power opportunities for you to target new markets, grow existing customer bases, improve response rates, reduce fraud and increase profits by using our data, analytics and technology. The intimate setting of the conference allows for unique networking opportunities with the industry’s most sought-after thought leaders,” said Klaudette Christensen, Experian’s Chief Operations Officer. A few spotlight sessions include: Several sessions about machine learning and artificial intelligence, highlighting opportunities related to best practices, underwriting and fraud detection A deep dive into the modern mortgage, leveraging insights on home equity and how to leverage data and analytics to redefine the process as it’s known today Sessions on credit delinquency, collections and the Great Recession Marketing analytics and the latest releases from Experian’s Ascend Platform Sessions on advanced analytics and integrated decisioning as they relate to commercial and consumer insights The event, which runs through Tuesday evening, continues its tradition of featuring several noteworthy keynote speakers. On Monday, Gary D. Cohn, American business leader, philanthropist and former Director of the U.S. National Economic Council, will kick off the event. On Tuesday, Aimée Mullins will take the stage discussing what is “possible” by drawing from her experiences as a record-breaking Olympic athlete, model and actress. The closing keynote will feature five-time NBA Champion and two-time Olympic Gold Medalist, Kobe Bryant. The event will also include a Tech Showcase, featuring hands-on demos for attendees to experience. Stay tuned for additional highlights and insights on our social media platforms throughout the course of the conference. Follow Experian Insights on Twitter and LinkedIn and check out #ExperianVision.

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.