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Ed Attanasio

Ed Attanasio is an automotive journalist based in San Francisco. Ed enjoys sports of all kinds and is a part time stand-up comedian.

 

He can be reached at era39@aol.com.

Wednesday, 08 April 2020 23:00

CCC Analyst Forecasts Impact of COVID-19 on Collision Repair Industry

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Director/Industry Analyst Susanna Gotsch from CCC Informational Services forecasts a rocky road that will drive up claim and repair cycle times for the rest of the year. Director/Industry Analyst Susanna Gotsch from CCC Informational Services forecasts a rocky road that will drive up claim and repair cycle times for the rest of the year.

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“The disruptions in auto parts manufacturing that occurred in China in January and February is expected to result in supply shortages beginning in late March through April and June,” Gotsch said. “If miles driven fall, this could lessen or delay that impact.

 

"Automakers looking for components for use in production had begun shipping at-risk components via cargo plane, and where necessary, looking for alternative suppliers or manufacturing locales for affected parts. As automakers come to grips with the real possibility that auto sales will fall, more will look to slow production even more.”

 

Gotsch’s report states the car manufacturers in the U.S. will do more to keep their customers from going broke in 2020.

 

“Numerous automakers are already offering consumers the ability to delay payments, purchase vehicles with zero-interest loans stretched out over many years or offering to pay monthly payments should a customer lose their job after purchase,” she wrote.

 

Gotsch forecasts a larger decline in new auto insurance premiums related to new car sales.

 

“During the Great Recession, private passenger vehicle net premiums declined, as auto sales in the country fell, and consumers opted to drop all but the coverage mandated by law,” the CCC report stated. “The biggest drop occurred within private passenger auto physical damage in CY 2009: -2.2%. If car sales fall as precipitously as we saw back in 2009, private passenger auto premium growth will also be impacted.”

 

Body shops will also have to deal with longer fulfillment times for certain replacement parts driving up claim and repair cycle times within the next few months or longer, Gotsch explained.

 

“As COVID-19 continues to spread, people will drive less due to quarantines and to limit overall exposure, so our industry can expect a drop in auto accidents and claims as well,” Gotsch said. “With the epicenter of COVID-19 now having moved out of China to Europe and the U.S., the overall impact to the global economy will be significant.

 

"All of us at CCC will continue to monitor this situation closely and provide additional updates during this unprecedented time as we return to normalcy.”


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