Right now, any one of us might reasonably and accurately predict the future. Say we are talking about paper statements. One day, very soon, they won’t be an option. We see it coming. Getting bill reminders texted to our phones. Typing YES and bills are paid instantly. At some point, service providers will move 100 percent away from the once genius paper statements to the now near standard electronic reminder. But in 1980, most of us wouldn’t have predicted that.
When I sat in my ’82 Chevy Beretta with my first bag phone, I didn’t see how that device would invade all aspects of my life, and certainly couldn’t see the future of paying bills from it. When I got my first text reminder, or even as little as a few years ago, I didn’t dream that I would one day click a PAY NOW button and take care of a bill without even logging into a portal and providing a username and password. We might have been saying “computers will rule the world,” but we didn’t really have an idea of what that meant.
Little by little and by leaps and bounds we are making progress. The closer we get to something, the more real it seems.
I’ve spent nearly my entire career in the auto finance industry, thinking and talking about “what is” versus “what should be” and “what could be” and “when.” We all feel powerless at times, dictated by the needs or whims of dealers and other factors outside of our control. Whether it’s perception or reality, feeling controlled can lead to a state of complacency. Complacency can slow our forward motion. And now is not the time to slow down.
Change is coming – especially in the auto industry. It’s just a matter of what and when. So, I thought it would be fun to try something.
Take a look at the list of questions below and predict what you think will be affecting our industry in the future. If you are reading this in the print magazine, clip it out, write in your answers, and photograph or scan it and email to me at firstname.lastname@example.org. If you are reading this online, click the link below and take the survey, and watch for a follow up blog at blogs.defiSOLUTIONS.com.
What do you think 2030 is going to look like?
1. What will be the average age to get a driver’s license? (In 2014, just 24.5% of 16-year-olds had a license, a decrease from 1983 when 46.2 did.)
2. What percentage range do you think is most accurate in the year 2030 for each of the bulleted questions below?
• What percentage of cars on the road will be self-driving?
Experts today predict autonomous vehicles will help curtail the number of lives lost in accidents. But can Americans give up control?
• What percentage of Americans will own a car?
Currently it’s over 90 percent.
• What percentage of cars will be sold through a traditional dealership?
According to Autotrader, car buyers spend 59 percent of their time researching online; the majority use third-party sites. While 81 percent of car shoppers give the test drive portion of shopping an 8-10 on a satisfaction scale of 1-10, after an average of three hours spent at a dealer, the customer satisfaction rate drops to 56 percent.
• What percentage of prospective first-time buyers will actually purchase a vehicle (not just lease or rideshare)?
Millennials currently own fewer cars than previous generations, but some say they were simply late bloomers or impacted by the Great Recession or school loans and are now buying cars in big numbers.)
• What percentage of prospective first-time buyers will lease (not buy or rideshare)?
According to Edmunds, “Over the past five years lease volume grew by 91 percent and in 2016 accounted for 31 percent of all new vehicle sales, up from 29 percent of sales in 2015.”
• What percentage of first-time buyers will rideshare (not buy or lease)?
According to Kinsey & Company, Lyft and Uber accounted for 30 million vehicle miles travelled (VMT) in 2013 and 500 million VMT in 2016. Still only one percent of overall VMT.
• What percentage of cars will be electric?
According to “The Economist,” in 2018 the electric car will be cheaper to own and operate and as “hip as the miniskirt once was.”
• What percentage of loan documents for auto will be fully 100 percent electronic, never printed?
For auto loan documents, current technologies make it possible to prepare, send, sign, and maintain all loan documents digitally. While the true percentage of total is unknown, according to Jeff Belanger, RouteOne’s senior vice president of Business Development, 40% percent of overall eContracting eligible contracts are booked electronically. Ford and Toyota lead the industry at a much higher rate.
3. In 2030, how many lenders will a dealer’s system send one application to?
Currently one app is reviewed by 2-3 prime lenders and 4-5 sub-prime lenders.
4. Innovation pushed Blockbuster out of the brick and mortar movie rental business. Which auto related lines of business will be the next “Blockbuster”? (Rank from most likely to least likely to survive.)
5. Forget about cars – self driving or not – what will be the next mainstream mode of transportation?
6. Would you mind telling us the year you were born?
When you sit back and do the math, you realize that 2030 is a mere 12 years away. How much can we change in one decade? A lot. We’ve seen it happen. We’ve made it happen. Let’s continue to work together to predict and drive what “what could be,” “what should be,” and “when.”
Stephanie Alsbrooks is CEO and chief soothsayer of defisolutions. E-mail Stephanie at email@example.com.