Auto finance companies and dealerships integrally involved in underwriting might have some kind of vehicle-history component embedded into their scorecards and other tools.
However, Black Book on Tuesday rolled out what the vehicle valuation company believes is its most precise tool yet — it’s VIN-specific History-Adjusted Valuations, an analytics-driven process for determining the impact a vehicle’s history has on its value.
Today when valuing a vehicle, Black Book contends that automotive industry professionals check the vehicle’s history report and make an “unscientific, educated guess” as to its impact on the vehicle’s value.
“This is subjective and problematic, as it often leads to mistakes in valuation,” Black Book said. “Making an inaccurate estimation on appraisal values can decrease margins for a dealer, as well as increase losses for auto lenders.”
Black Book has leveraged its advanced analytics capabilities and deep editorial expertise to bring insight into precisely how a vehicle’s historical events impact its value. The company insisted this development is critical since a recent survey of automotive professionals indicated that 96 percent of respondents feel a vehicle’s history has a moderate to significant impact on the value of a used vehicle.
Black Book’s creation of History-Adjusted Valuations analyzes multiple factors and events in a vehicle’s history such as number of owners, vehicle usage, accident and accident severity, title issues, flood/hail/fire damage, CPO history, and other variables that are not obvious when physically inspecting a vehicle.
“We are providing our customers a competitive advantage by precisely valuing a vehicle based on its VIN-specific history," said Jared Kalfus, executive vice president of revenue at Black Book. “Whether appraising a trade-in, bidding at auction or valuing a vehicle portfolio, precision drives profit, growth and customer satisfaction.”
Black Book’s customer promise is to deliver ever more precise valuations. On average, History-Adjusted Values are 31 percent more precise when compared to the auction transaction price than valuations without a history adjustment included.
“The evolution of data and analytics continues to have a profound impact on the overall auto industry, from dealers and remarketers, to manufacturers and lenders,” said Anil Goyal, executive vice president of operations at Black Book. “Our analytics play a significant role in recognizing the patterns in a vehicle’s history and determining their impact on each vehicle’s value, enabling our customers to make better decisions.”
To learn more about Black Book’s new History-Adjusted Valuations, call (800) 554-1026.