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2018
prepared by
Susanna Gotsch
Putting the AI in the Automotive Industry


Advances in digitalization, artificial intelligence,
machine learning, the internet of things (IoT),
sensor and camera technology are driving
dramatic change and improvements in
automotive technology. And these advances
are creating a ripple eect throughout the
entire automotive ecosystem.
Accident avoidance technology, or advanced
driver assistance systems (ADAS), are
beginning to gain good market traction, and
the auto industry is beginning to explore what
the implications of these are to auto sales, auto
care, auto repair, and auto replacement. Layer
in car sharing, and autonomous vehicles, and
it’s clear that the traditional auto ownership
model will change.
In 2017 Crash Course we explored market
dynamics through the context of an
automotive claim. With data and technology
driving change into so many aspects of our
lives, this year we will instead look through
the lens of the full auto ownership life
cycle – from auto shopping to purchase
through vehicle end of life, hoping to provide
some visibility into how these will change in
the future.
We’ll begin with the ‘Buy’ decision, exploring
why consumers buy vehicles, how they
decide which vehicle to buy, how they pay
for the vehicle, how they choose to insure
the vehicle, and how auto industry sales have
fared to date and what they may look like
in the future. Today’s vehicles have a natural
depreciation and deterioration cycle that
ultimately leads to the need for replacement.
Will the replacement of the future involve a
new vehicle purchase or something like an
autonomous vehicle subscription?
When the vehicle is acquired, we move into
the ‘Drive’ phase. In this section, we’ll explore
how driving has changed and how it may
change in the future. Will overall miles driven
continue to grow? Who actually will be doing
the driving? How might insurance change
when we consider the change in who is
control of the vehicle? With the auto industry
reeling from numerous years of significant
vehicle recalls, how does more technology
that now controls the vehicle itself challenge
automakers in the future?
With the focus on crash avoidance and,
ultimately, vehicle autonomy, will auto
‘Crash’(es) and fatalities fall? And how
quickly? Early benefits of ADAS have shown
marked improvement to bodily injury claim
frequency and costs. How might this change
insurance casualty claims? Is the ‘Road
to Zero’ a possibility, and when might we
get there?
When the vehicle does crash, and needs
‘Repair’, what further changes can we expect
in terms of the types of tooling, training, and
investment required of collision repairers? How
will repair frequency and costs change? With
OEM’s taking a more active role in providing
information on how the vehicle should be
repaired, how will that change our industry?
And finally, if the vehicle cannot be repaired,
what does that mean to the consumer and
her decision to jump back to the ‘Buy’ start of
the overall cycle?
Finally, data and intelligence will continue to
drive market developments in each of these
areas. This year our guest authors will provide
some thoughts as to how digitalization, data,
analytics, and artificial intelligence (AI) are
bringing change to our industry today.
“It’s Happening” was our 2017 theme for Crash
Course – and it’s safe to say that our industry
endured a good deal of transformation
throughout the year. With the promise
of rapidly advancing technology such as
AI, this year we’ll provide our viewpoint
“Putting the AI in the Automotive Industry.”
So, sit back, and we hope you enjoy this year’s
issue of CCC’s Crash Course!
executive
summary
05
PART 2
DRIVE
PART 1
BUY
2
5
PART 3
CRASH
57
PART 4
REPAIR
79

What Americans
Are Buying Today
In 2017, over 90 million vehicles were sold
globally.
1
The United States continues to be
one of the single largest markets for vehicle
sales. In 2016, a record 17.55 million light
vehicles were sold in the U.S., beating the last
record set in 2000. In 2017, auto sales slowed
by 1.8 percent to 17.25 million; however, record
average new vehicle prices meant a majority
of automakers still considered it a very good
year (see Figure 1). Most analysts project
auto sales will slow to between 16.5 million
and 16.9 million in 2018, with less pent-up
demand, higher interest rates, and declining
used vehicle values driving sales down. At
the same time, continued growth in the U.S.
population, a strong economy and strong
employment, and consumer desire for new
auto features such as WiFi and advanced
driver assistance systems (ADAS), will help
bring customers back to the showroom, just
at a slower rate than the last three years.
Light truck sales achieved a new record –
64.5 percent of all new vehicle sales in 2017,
as car sales in 2017 fell 11.2 percent while light
truck sales grew 4.4 percent (see Figure 2).
The average new vehicle transaction price
rose 2 percent for the full year (versus 2.5
percent in 2015 and 2016), with December
2017’s transaction price of $36,113, setting
a new high, and largely driven by higher
light truck sales (see Figure 3).
2
Light
trucks – and full-size pickups in particular-
continue to drive a great deal of the profit for
automakers, particularly the U.S. automakers.
Profit margins on pickup trucks typically
are well above 10 percent and can outpace
margins on luxury cars.
3
With an average
selling price of over $47,000 for full-size
pickups in November 2017 (with upgrades
that price can jump to as much as
$60,000), it can be argued that
pickups are the new
luxury segment.
4
05

BUY
7
© 2018 CCC Information Services Inc. All Rights Reserved.
6
© 2018 CCC Information Services Inc. All Rights Reserved.
For example, Fiat-Chrysler dropped
numerous small and midsize passenger cars
from its lineup, to instead focus on Jeep
SUVs and Ram pickups.
5
And despite an
expected slowdown in auto sales, in the next
10 years an additional 25 million consumers
in the U.S. will move into the 35 to 44 age
bracket. LMC Automotive predicts many will
opt for bigger SUVs as they move to suburbs,
potentially driving up sales of midsize SUVs
by 16 percent between now and 2022, while
large SUVs may jump as much as 25 percent.
6
As auto sales slow in the coming years, sales
of these more profitable vehicles will be key
as automakers are pressured to maintain
profitability while investing billions in new
strategies for self-driving and
electric vehicles.
7
As the average MSRP of new vehicles has
grown, so too have concerns regarding
aordability. As of Q3 2017, there were over
$1.21 trillion in open automotive loans, with
an average loan term length of 69 months.
8
Easier credit allowed more buyers from the
subprime markets to enter the market again,
resulting in slightly higher delinquency rates
as the year progressed, particularly among
auto finance companies that have historically
originated and held more than 70 percent of
subprime auto loans.
9
Overall however, the
outstanding loan balance for the subprime
sector has remained fairly steady at about
24 percent of the overall since 2011.
10
And
while there was some concern that the
market might face an auto finance bubble,
many banks restructured their portfolios and
adjusted their auto finance exposure in 2017.
11
Transunion reported declining originations
each quarter between Q2 2016 and Q2 2017,
and the slowest growth in overall auto-
finance balances in Q3 2017 since Q3 2012.
12
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14. 00
16.00
18.00
20.00
CY 1996
CY 1997
CY 1998
CY 1999
CY2000
CY2001
CY2002
CY2003
CY2004
CY2005
CY2006
CY2007
CY2008
CY2009
CY2010
CY2011
CY2012
CY2013
CY2014
CY2015
CY2016
CY2017
CY2018E
8,130,945
7,884,601
7,042,140
5,69 2,432
5,987,531
6,378,508
7,472,518
7,788,973
7,7 49,432
7,566,668
6,893,078
6,120,774
8,4 30,044
8,269,351
6,203,578
4,739,077
5,602,313
6,400,377
7,020,574
7,7 93,163
8,773,231
9,916,173
10,645,974
11,125,098
0 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 12,000,000 14,000,000 16,000,000 18,000,000 20,000,000
CY2006
CY2007
CY2008
CY2009
CY2010
CY2011
CY2012
CY2013
CY2014
CY2015
CY2016
CY2017
Cars
Light Trucks
-2.0%
-1.5%
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
CY2005 CY2006 CY2007 CY2008 CY2009 CY2010 CY2011 CY2012 CY2013 CY2014 CY2015 CY2016 CY2017E
% CHANGE FROM PRIOR YEAR
AVG MSRP NEW VEHICLES SOLD
Avg MSRP % Chg from Prior Year
U.S. Light New Vehicle Sales in Millions (Figure 1)
CY1996-CY2017
Light-Truck Share of U.S. New Vehicle Sales (Figure 2)
CY2006-CY2017
NADA “Average Selling Price of New Vehicles Sold” (Figure 3)
CY2005-CY2017E
Source: Automotive News
Source: Automotive News
Source: NADA
64.5%
60.7%
56.7%
53.1%
50.0%
48.4%
50.1%
48.3%
45.4%
46.8%
51.2%
50.9%
剩余56页未读,继续阅读














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