Mitchell International released their third quarter Industry Trends Report this month; the report focused on gas prices and their affect on car-buying and car value trends. This issue also discusses how volatile and sustained high fuel prices are impacting insurance claims beyond a reduction in miles driven.
Vice president of industry relations for Mitchell International Greg Horn talks about the role gas prices play in resale values of vehicles from fuel-efficient to so-called gas guzzlers.
“Fuel efficient vehicles tend to rise more quickly and reliably in value during periods of high gas prices than gas guzzlers, which fall in value,” Horn said in the report.
The insurance and collision repair industries need the accuracy of a true market survey method for valuing a total loss because constantly fluctuating fuel prices move too fast, with too great an impact, for slower traditional ‘book value’ valuations to accurately reflect the true actual cash value of total loss vehicles.”
Other valuable points of interest in the current issue of Mitchell’s ITR include:
Mitchell’s Q2-2011 data reflect an initial average gross Collision appraisal value of $2,761-$90 less than this same period last year. However, applying the indicated development factor of 9% suggests a final Q2- 2011 average gross collision appraisal value of $3,008. The average Actual Cash Value (ACV) of vehicles appraised for Collision losses during Q2-2011 was $13,705-an increase of $500 over the same period last year.
In Q2-2011, the average gross appraisal value for Comprehensive coverage estimates processed through Mitchell servers was $2,854-compared to $2,625 in Q2-2010. Applying the prescribed development factor of 1% for this data set produces an increase in the adjusted value to $2,883-reflecting the strong storm season with many hail claims.
For more information about Mitchell, visit www.mitchell.com.
To view the entire report please visit www.autobodynews.com.