Tag: vehicles

In a recent episode of the Used Car Dealer Podcast, host Zach Klempf, sat down with Jim Maguire, Experian’s senior director of product marketing for automotive, to discuss the prevalence of fraud in the automotive industry. During their conversation, Jim highlighted the findings in Experian’s 2023 Identity and Fraud Report, giving listeners a deeper understanding into the evolving dynamics of fraud, with data and insights on the current landscape and what actionable strategies dealers can take to prevent it. The episode is now available across all major podcast platforms, click the link below to watch: YouTube For more information on the Used Car Dealer Podcast, visit - https://www.sellyautomotive.com/podcast Facebook - @SellyAutomotive Twitter - @SellyAutomotive LinkedIn - @SellyAutomotive

Whether a consumer has a brand-new or used vehicle, it’s inevitably going to need regular maintenance and require repairs. Fortunately for aftermarket professionals, the aftermarket “sweet spot” is continuously growing—a trend that should be watched closely. Vehicles in the sweet spot are typically between six- to 12-model-years-old and have aged out of general OEM manufacturer warranties for any repairs. Knowing the model year and type of vehicles that are in operation will be important for aftermarket professionals to determine what parts may be needed, and anticipate potential consumer needs. According to Experian’s Automotive Market Trends Report: Q1 2022, 35.8% of vehicles in operation (VIO) now fall within the aftermarket sweet spot, a 6.5% year-over-year increase. It is important to note that the aftermarket sweet spot max volume record of 104 million is expected to be broken over the next 12-18 months, considering the sweet spot volume was 100.3 million through Q1 2022 and the last time it exceeded that number was nine years ago. The increase will create more opportunities for aftermarket professionals as more vehicles will potentially need maintenance. Aftermarket “sweet spot” will continue to grow Right now, the aftermarket sweet spot consists of model years between 2011 and 2017. There were 10.5 million 2011 model year vehicles on the road through Q1 2022, this low volume will transition into the post-sweet spot next year. At the same time, there will be 16.5 million 2018 model year vehicles entering the sweet spot. Furthermore, an estimated 16.7 million vehicles in operation with a 2019 model year and almost 14.3 million vehicles in operation with a 2020 model year will be transitioning into the sweet spot in the next two years. When these model year vehicles enter the sweet spot, the current 12 million vehicles with a 2012 model year and an estimated 13.7 million 2013 model year vehicles will transition into the post-sweet spot, resulting in a notable increase. Watching this data closely will allow aftermarket professionals to continue assisting with maintenance and repairs for these vehicles that are currently on the road, as well as prepare for what’s to come to the aftermarket industry in approaching years. To learn more about other vehicle registration trends, watch the full Automotive Market Trends Report: Q1 2022 presentation on demand.

Last year is a testament to how quickly trends can shift, and entire industries can be turned upside down.

While the automotive industry initially took a hit at the onset of COVID-19, things are beginning to rebound. New vehicle registrations are still down compared to 2019, however, the year-over-year comparisons by month are starting to level out. And, while most of the attention has been paid to new registration figures, we can’t lose sight of the vehicles on the road. Some consumers acted to take advantage of automaker incentives and low interest rates, and others purchased due to newfound needs, but the vast majority have stuck with their current vehicle. That means, despite some bumps over the past few months, opportunity for the aftermarket and dealer service departments to thrive by keeping these vehicles on the road still exists. It starts with understanding what’s on the road. Insight into these vehicles will better position aftermarket suppliers and repairs shops to perform scheduled maintenance and address the needs of drivers. According to Experian’s Q2 2020 Market Trends Review, there were 280.6 million vehicles in operation, up from 278.1 million a year ago. Of those vehicles on the road, light-duty trucks accounted for 56.5%, and passenger cars made up the remaining 43.5%. So, there’s little surprise that the top three segments on the road were full-sized pick-ups (16%), CUVs (10%) and mid-range cars (9.9%). And if we break it down even further, the top three brands were Ford (15.5%), Chevrolet (14.3%) and Toyota (12.1%). But we understand that not all 280.6 million vehicles will need aftermarket parts or service; it’s important for the industry to keep a close eye on the aftermarket “sweet spot”—those vehicles that are six- to 12-years old. Identifying these vehicles and anticipating their maintenance needs will help aftermarket suppliers navigate the recovery. In Q2 2020, 31.2% (87.6 million) of vehicles in operation fell within the “sweet spot”—with a mix nearly 46% domestic and 54% import brands. And while the opportunity today is significant, we expect the “sweet spot” to continue to grow for at least the next four years. To make the most of the opportunity, aftermarket suppliers need to understand where these vehicles are located, what types of vehicles fall within the sweet spot and the most common parts that are used. COVID-19 has shifted the industry for all parties involved. Some consumers may opt to hold onto their vehicles a little bit longer rather than purchase a vehicle; only time will tell. In any event, the more aftermarket suppliers and repair shops understand about the vehicles on the road, the better positioned they will be to address the needs of consumers and grow business. To view Experian’s full Q2 2020 Market Trends Review, click here.

Experian recently released its Q1 2020 Market Trends report, which provides insights about the vehicles on the road and the most popular vehicle segments. 

In the past 10 years, consumers begin purchasing convertibles as early as March.

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.

Like every other industry, the automotive market is driven by consumer preferences and behavior. While there are a myriad of options to choose from, fuel-type seems to dominate media headlines as a hot topic of conversation among industry pundits and consumers, alike. Little surprise then that alternative fuel vehicles, which include diesels and hybrids, have maintained a steady demand over the past few years. But, there’s a specific segment that’s beginning to emerge. As we detailed in our earlier blog series, electric vehicles (EVs) are began to stand out as a prominent alternative fuel vehicle. And during Q3 2018, we saw more of the same. EVs held 1.8 percent share of total vehicle registrations. While that number may seem small, consider this.  Just two years ago, in 2016, EVs comprised only 0.5 percent of registrations, growing at a much slower pace since 2014, when it was 0.4 percent. It’s worth noting that gasoline-powered cars still dominate the market, making up 92.9 percent of registered vehicles through Q3 2018. But, the demand for alternative fuel type options should not be underestimated. Alternative fuel vehicles are becoming a significant segment in today’s auto market, and the large growth in EVs are a testament to that growth. While EVs are proving to be a popular option compared to other alternative fuel types, other options remained steady. Diesel vehicles maintained 2.8 percent of the market year-over-year, while hybrid vehicles saw a slight increase since 2017, growing from 2.6 to 2.8 percent of the market. A picture of the alternative fuel buyer So, who’s investing in these alternative fuel vehicles? We see that most buyers tend to be married, single family home owners with a college education, and belong to either the Baby Boomer generation or Gen X. It’s interesting to note that EVs make up a notable percentage of registrations of alternative fuel type preferences across generational car buyers, according to Q3 registration data. Among Baby Boomers, EVs fall second to hybrids, accounting for 1.0 percent of registered alternative fuel type vehicles compared to 1.2 percent respectively. But, EVs made up the biggest share of alternative fuel type registrations among Millennials (1.1 percent) and Gen X’ers (1.2 percent). With the number of vehicle options available on the market today, EVs 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 the EV market and its potential. To learn more about the electric vehicle market and other alternative fuel type vehicles, view the full Q3 2018 Automotive Market Trends Analysis webinar.

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!

Throughout the year, there are certain models that are incredibly popular. SUVs and crossovers fly off the shelves during the wintertime while down south, the pickup-truck is the sales king. There are times when less popular vehicles flood your inventory, creating stress for your sales team to try and get them into the hands of customers. The good news for dealers is that you don’t need to panic when strange bonus programs are floated out by the manufacturer. Data-driven methods can be used to find potential buyers. The upshot of this is dealers don’t have to wait for buyers to waltz into their showroom. Although you can pick a specific model based on incentives, it is a good idea to review your model goals to confirm they are realistic. Based on the models you are trying to move, identify the sales trends by unit and geography. This analysis may help you discover the vehicle margin opportunity isn’t worth the advertising investment. On the other hand, you may learn competitors are selling a plethora of that model and there is plenty of room to conquest market share. Always let data be your guide. Checking a vehicle’s popularity can determine if you should market it. If the model’s popularity in your geography is growing, it will be easier since potential consumers are going into showrooms, asking questions, and doing research online. On the flip side, a vehicle with declining popularity is more difficult, and therefore more expensive, to market. As vehicles become unpopular or out-of-season, aggressive pricing may be in-store. In the past, the “spray and pray” method was what dealers and marketers would use, simply hoping that your campaign would find your target. Today, the best practice is to pinpoint the demand for your model by analyzing your pre-determined market radius to identify those ZIP Codes™ which show the most interest. For example, narrowing down to neighborhoods showing recent sales of your model can help identify future purchase demand. When combined with demographic, psychographic, web analytics, and your CRM data, the formula for determining model-specific demand becomes a precise science. Determining where to market is one thing, but identifying the in-market customer is another thing altogether. To identify the persona for potential purchasers of your models, utilize a system like Experian’s Dealer Positioning System. It helps determine the demographics and psychographics of consumers along with various buying patterns. This persona will include what interests consumers of your model and what they value in a marketing message. While creating the persona, think about what kind of marketing would be the most effective. Are your customers on social media and would they prefer digital advertising? Perhaps a more traditional approach with direct mail or by phone? Understanding their preferences will indicate which approach will most effectively resonate with them. Now campaigns for your model of choice can begin. Use the ZIP Codes and demographics of your highest potential customers to create an effective media plan. Based on the data, craft out digital, traditional, or other campaign types that can be run successfully. Focus on the features that will most appeal to your key demographic– all-wheel-drive, navigation, advanced safety features, made in America, etc. Moving that model off the lot and onto the customer’s driveway does not have to be difficult. If the model is not popular in the first place or it isn’t the right time to market it, you may not want to spend money trying to promote it. With the methods we stated earlier, selling a vehicle to customers based on geotargeting and specific marketing messages make moving even the most unwanted vehicle easier. Also, remember the where, who, and what. Where are you targeting your customers, who are your customers, and what medium are you going to use? Using this can help to move that model and grant you sales success.