lifecycle of automobile ownership 2 24 16 fico

© 2016 Fair Isaac Corporation. Confidential. This presentation is provided for the recipient only and cannot be reproduced or shared without Fair Isaac Corporation’s express consent.

FICO Auto & Motorized Mastermind Network MeetingFebruary 23–25, 2016 | Napa, California

Lifecycle of Automobile Ownership

Barrett TeagueVP, Lender Solutions, Black Book


When you think value

• You think sales• You think loans• You may consider insurance• What if I named nearly 50 touch points


Action in the Auction LaneMost often associated with true “Value”


Seven Starting Points


Disruptor

• While you hear the vehicle value cycle, where are opportunities for disruption?

• Black Book is more than just value• Think about the future of transportation• Think from the decision network, which

number shapes our future?


Financial Usage

• Underwriting─ Loan Pricing─ Verification at booking─ Prediction of future portfolio

behavior• Portfolio Analysis

─ Setting reserve for loan losses─ Based on analytics

• Change receivable mixture• Choose to offload or increase

Lending• Residual Setting

─ Facilitating sales─ Lease End Preparation─ Off Lease, CPO, etc.

• Organic Growth─ Lenders mining their own

portfolio• Remarketing

─ Supportive captive client ready to purchase again

─ Repo

http://www.blackbookauto.com/lender-solutions


• Floor planning─ Making inventory readily

available• Dealer financing

─ When an Owner wants to sell a dealership

• Audit • Compliance

• Collections─ Strategy can vary based on

positioning• Securitizations• Ratings agencies

─ Build value in a portfolio beyond historical performance

Financial UsageLending

http://www.blackbookauto.com/lender-solutions


Manufacturing Shipping Marketing

Now let’s retreat to the beginning


Origin

• Manufacturer─ Historical performance indicates

future ─ Brand loyalty is measured in

some ways through value

• Shipping─ Inventory shipped must be

insured─ Premium calculation

• Dimensions for rail• Weight to project fuel

consumption

• Marketing─ Setting consumer expectation

• Think of the ads touting strength of residual

─ Mailers to consumers generate desire

─ Equity calculations• “used car buy back” flyers

─ Internal marketing to existing clients• Predicting when a client will want

a new vehicle and offering tools to assist


The Dealership as a Power User

• Purchase at Auction / Floor plan• Auction Buy Back• Evaluate trade in• Inventory management• LIFO calculations for taxes• Dealership sales• Acquisitions


After the Sale

Government Insurance Legal


The Back End

• Government─ Taxation ─ Ad valorem─ Benefit calculation

• Legal─ Litigation─ Bankruptcies─ Fraud detection

• Insurance─ Underwriting to the proper level─ Pricing─ Claims

• Theft• Damage

─ GAP settlements─ Rental Policies─ Global policies─ Residual Value Insurance


There are endless opportunities to create, earn and build value across the lifecycle of a single vehicle.Where does your innovation fit?

© 2016 Fair Isaac Corporation. Confidential. This presentation is provided for the recipient only and cannot be reproduced or shared without Fair Isaac Corporation’s express consent.

FICO Auto & Motorized Mastermind Network MeetingFebruary 23–25, 2016 | Napa, California

Thank YouBarrett [email protected]

mailto:[email protected]

lifecycle of automobile ownership 2 24 16 fico

Automotive