The nationalaverage length of replacement rental (LOR) rose slightly in the second quarter of 2015 to 11 days overall, reversing a downturn seen in the first quarter’s data. Compared with the second quarter of 2014, the LOR increased 0.3 days and was up 0.5 days over the 5-year average. The quarterly data, gathered by Enterprise’s Automated Rental Management System® (ARMS), tracks the length of time replacement vehicles are rented to collision center customers and is considered a proxy for vehicle repair time.
Though an increase in accidents due to weather may have played a role in the second quarter LOR increase, there were likely other contributing influences, according to Frank LaViola, assistant vice president of collision industry relations for Enterprise.
“While some regions, such as the Midwest, experienced wetter than normal weather conditions, others were below normal and still increased in LOR,” said LaViola. “So, we need to look at other factors that may be driving longer cycle time. Those could include technician shortages and training, the complexity of newer vehicles being repaired and other issues, such as parts delays.”
The Northeast region led the nation with the highest LOR at 12.3 days. The lowest LOR, 9.4 days, occurred in the Northwest region. The Mountain Region saw the largest increase in LOR, 1.2 days, due in part to the recent hail catastrophes in Colorado. Widespread hail events tend to leave auto repair shops inundated with work for several months and bog down the repair process.
Collision Industry Resource
Enterprise began sharing length of rental information – at no cost – with collision repair centers six years ago in an effort to highlight below-market-average cycle times and provide critical performance data for consistent industrywide comparisons. Although ARMS can help to decrease the duration of rental periods, Enterprise has embraced the system as an opportunity to increase customer service and provide added value to its collision repair and insurance partners.
ARMS data helps collision repair centers increase operating efficiencies, enhance customer service and streamline communications with insurance companies and customers. The ARMS digital management platform enables repair centers to book rental reservations and send vehicle status updates to insurance partners and customers. In addition, repair centers can track, measure and forecast labor needs, and generate monthly reports through ARMS.
Enterprise’s ARMS data has become an invaluable resource for the collision industry. The data figured prominently in the recent Collision Industry Conference where Enterprise’s LaViola joined other insurance and collision repair experts in exploring new solutions for managing repairs and the duration of rentals. Marcy Tieger, principal at Symphony Advisors, moderated the discussion as panelists debated the merits of current methodologies and new solutions for managing repairs.
“Bringing together such a diverse group of experts marked an important first step toward developing a more efficient formula for managing length of rental,” said Tieger. “Enterprise’s ARMS data was especially helpful to this discussion. As the largest cross-section of data currently available, it provides a comprehensive look at the collision repair landscape.”
“For decades, insurance providers and collision repairers have been operating under the same fixed formula for estimating cycle time,” LaViola added. “With automotive technology growing in complexity, it’s increasingly important to take advantage of holistic collision repair statistics, such as Enterprise’s ARMS data, to get a more accurate picture of the repair process and better manage length of rental.”
With more than 5,500 fully staffed airport and neighborhood offices located within 15 miles of 90 percent of the U.S. population, the Enterprise Rent-A-Car brand is able to provide replacement rentals to customers of collision repair centers and insurance companies all around the country.
About Enterprise Rent-A-Car
Founded in 1957, Enterprise Rent-A-Car is an internationally recognized brand known for an extensive network of locations, affordable rates and outstanding customer service. When severe weather and natural disasters strike, the Enterprise neighborhood network plays an integral role in mobilizing the local recovery effortsof insurance providers, emergency response organizations and repair shops. Enterprise Rent-A-Car’s local branches and its insurance and collision partners also can leverage the company’s evolving technology platforms, such as ARMSand the Priority Pass program.