While many parts of the auto industry are considered essential and have operated throughout the pandemic, there have been obvious and severe impacts to everything from manufacturing to lending to insurance to data collection. In addition, Covid-19 has caused the industry to reframe how we think and communicate about safety issues. A global pandemic and resulting social and economic pressures have changed many people’s priorities. Communicating about vehicle repairs in the face of a health crisis – especially during the periods of sheltering in place and lockdowns – may be received as insensitive. Reaching vehicle owners also was challenged since many people moved to shelter with family or friends or to live in less expensive areas due to working remotely or other job changes.
Dealers, lenders, repair providers and other parts of the auto industry had an opportunity to create new ways to serve consumers, including mobile repair and concierge services as mentioned in our previous blog. Extra steps including vehicle cleaning, providing PPE for employees, and allowing for social distancing within repair shops also are required now to help assure owners that they and their vehicles are kept safe during the repair process.
From a data standpoint, DRN has noticed a “mixed bag” during the pandemic. With communities in various stages of shutdown, businesses closed, and many people working from home or – unfortunately – unable to work, there have been fewer cars on the road and more staying parked at home. This resulted in a decrease in vehicle scans, but also enhanced our ability to locate vehicles and verify accurate addresses. Through this, we initiated various migration studies that confirmed a significant increase in borrower relocation during the pandemic. In one example, movement of more than 50 miles from the stated address was 4.2% of the portfolio in January 2020. By March, it had grown to 10.5% – an increase of 125%. We also saw a high rate of data depreciation due to the increase in migration.
Tune in next week for the last part of our Auto Recall Blog Series, or click here to download the full white paper.
