Monthly Car Payments Are Soaring

these associations working together in a spirit of harmony for the good of the independent collision repairer,” he said. “If this conference was this good already, I can’t wait to be a part of it next year!”

Sustained Success for Collision Repairers

David Willett, chief underwriting officer at Spark Underwriters, discussed “5 Keys to Sustained Success for Collision Repairers.”

Recognized as one of the top leaders at Universal Underwriters, Willett said the intertwine between the five keys is what makes them so powerful. The third key—Shareholder Intimate—is a topic he said is often skimmed over and misunderstood.

“One aspect of it is that everyone in business creates value—any shop that delivers vehicles, any paint company that provides paint, any parts supplier that provides components, creates value,” he explained. “We can argue if the value is adequate, appropriate or enough another time.”

The question, according to Willett, is how much a business is able to keep of the value created—usually in dollars.

“The more imperfect your market(s), the greater percentage you usually get to retain as compensation,” he explained.

During his presentation, Willett also discussed how to use the insight of thought leaders and business groups to develop a well-defined smaller unique market. He noted the fifth key is about development—both personal and professional—and said the goal is to get 5% to 10% better each year.

Willett noted events like the Southeast Collision Conference are important for the development of an automotive professional’s business and industry knowledge.

“It was a successful event with Josh Kent’s leadership, the strength of the CCA and two up-andcoming associations, Gulf Coast and Tennessee,” observed Willett. “The attendees were treated to a strong line-up of thought leaders and suppliers. It is a good thing too as collision repairers were looking to get better, including the many top-tier multi shop owners (MSOs) and single site operators (SSOs) in attendance.”

by Steven Symes, Motorious

One of the areas where people have really been feeling the pinch in the past year or so is car payments.

Unsurprisingly, the average car payment in the U.S. reached an alltime high of $712 in May, according to Moody’s Analytics. While some might just shrug at such a figure, for some households that’s a crippling amount to be shelling out month after month.

Helping contribute to the rising monthly car payments is the fact the average new car was $47,148 in May, according to Kelley Blue Book. It wasn’t that long ago the figure was just a little over $30,000.

And as you likely already know, it’s not like household incomes have increased by an additional 50% suddenly. Worse, rising costs for fuel, utilities, groceries and other essentials are making plenty of people feel like they’re in a financial vice, getting squeezed more and more to the point of breaking.

A recent Cox Automotive & Moody’s Analytics vehicle affordability index report painted an even darker picture. Thanks to higher interest rates combined with more expensive cars, Americans on average can afford less. Quite literally, their dollars are buying less when it comes to vehicle purchases. Plus, increased lending rates mean they qualify for even less expensive options, a double hit which might mean a lot of shoppers are downgrading from one vehicle class to another while paying just as much if not more than before.

Compounding the problem is of course the constrained supply of new cars, thanks in part to the microchip shortage. Demand for new vehicles is strong, causing prices to continue climbing.

All this means it would cost the average household 41.3 weeks of income to buy the average new vehicle. That’s a 19% increase from May of 2021.

These are sobering facts. Surely the market can’t continue to sustain this kind of price inflation, so something has to give, if not multiple things. Exactly what those would be is up for debate.

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