As the auto industry moves further into 2025, new challenges are presenting themselves. Consumer behavior is evolving, putting pressure on the automotive industry to evolve in step. Luckily, there are new opportunities on the horizon, and if the auto industry is smart about its strategies, it can enjoy increased success moving forward.
Data shows that many consumers are facing increased financial pressures. Auto debt is increasing and is now the fastest-growing category in non-mortgage consumer debt. At the same time, the average price of a new vehicle is also increasing, as are interest rates. In fact, interest rates in 2024 were 56% higher than in 2016.
Additionally, increased financial stress often corresponds to increases in fraud and delinquency. This has proved accurate in recent years; since 2020, there has been a 59% annual increase in synthetic identities. In 2023 alone, synthetic identity fraud increased by 98%, resulting in $7.9 billion in losses.
Fortunately, there are solutions to these problems. 72% of consumers would visit dealerships more if the buying process was improved. This suggests that using Know Your Customer (KYC) tools to elevate the buying experience can go a long way in getting customers in the door. Not only does it make the process more pleasant for consumers, but it also can boost sales.
Another tool is fraud prevention. Weeding fraud out before it has a chance to grow roots can prevent significant economic losses. Solutions like Digital Identity Trust can be a huge help in proactive fraud prevention.
Despite new challenges, the auto industry has opportunities to grow and improve. Taking advantage of KYC tools and anti-fraud measures is important to propel the auto industry to a successful year.
