The Current Economic State of The Used Car Industry
Many hoped the end of 2021 would spark a light at the end of the tunnel in terms of used car prices, however, the tides have yet to turn as record prices continue to impact those looking for a vehicle. As consumer inflation was reported to have increased 6.8% in the 12 months prior to November, one of the biggest factors in this increase was used vehicles.
The importance of reliable vehicle GPS tracking has only been heightened within the past year. Before the pandemic, the average used vehicle price was 54% of the average cost of a new vehicle. By the end of 2021, it has increased to 63%. While this sharp increase is beginning to slow, vehicle prices are not likely to decrease anytime soon, standing as a formidable obstacle for BHPH dealers working with those risky buyers of low credit scores.
Potential Consequences for BHPH Auto Dealers
As used car prices remain high, auto dealers are faced with a variety of consequential issues in their industry. In 2019, nearly 20% of car loans were held by individuals with poor credit. The effects of the pandemic have only emphasized these circumstances and the average number of delinquent accounts continues to steadily rise. With the average used car payment now amounting to more than $500, auto dealers can expect an increased risk of poor payment performance. It’s important for auto dealers to implement reliable and swift payment processing now more than ever, as it is never a good time for BHPH auto dealers when the average person can barely afford a used car.
The ongoing computer chip shortage as a result of the pandemic continues to take its toll on vehicle production for many automakers, vastly limiting production, and Goldman Sachs forecasts the shortfall to persist well into 2022 and 2023. This has resulted in new vehicles being in short supply and thus used cars selling at a premium. With customers now more than ever-fleeting to the used car market, it goes without being said that there will be a ripple effect throughout the entire industry level that would impact inventory levels across the board. Strained inventory levels further shed light on the importance of prompt recoveries on those with delinquent payment and getting dealers’ cars back on the lot ready to sell to take advantage of the heightened demand. Â
Be Proactive Rather Than Reactive With Vehicle GPS Tracking
These increased risks highlight the need to ensure all of your auto lending collateral is secured with an advanced GPS Tracker. Devices such as the iGotcha GPS Quick Device allow you to get your cars back on the lot and combat the very high used car prices that are increasing risk. iGotcha GPS puts auto dealers in control of their vehicle assets with on-demand location features, impound lot notifications, and a specialized DMS platform.
Hold the ability to execute swift and secure repossessions with industry-leading visibility into your collateral. Subprime lenders and BHPH dealers know there’s always a risk when it comes to borrowers with less than stellar credit, and that couldn’t be more than true today.
iGotcha GPS Protects Your BHPH Collateral
For over 16 years iGotcha GPS has provided those in the auto-lending industry the peace of mind they deserve.
- Trackers In Stock – Ready To Be Shipped!
- Locate Your Collateral On-Demand
- Streamline Your Collection Efforts
Combat The Trepid Used Car Market Today
With increased risk comes an increased need for protection. iGotcha GPS provides BHPH auto dealers with complete control over their vehicle assets at all times. CallPass has the solution you need to combat the risks of poor auto payment performance, strained inventory levels, and unprecedented changes in the used car industry.Â
If there was ever a time to invest in reliable GPS Tracking for your BHPH dealership, it’s now. Don’t allow the current obstacles facing the BHPH auto industry to affect your business. Take action, and let iGotcha GPS protect and monitor your cars, so you can handle the rest.Â
