One of the things that the emerging world of big data will make possible is to know detailed history on everything. This will have profound impacts on selling ‘pre-loved’ items in general and used cars in particular. With the US used car market valued at around $400bn annually, this is worth noting.
Today, the used car market is – naturally – keen to know the history of the car. However, the way in which this is communicated is still quite limited: in some places a log book containing service history is the norm, other more sophisticated variants include carfax, which tracks odometer readings and reported crashes or, for example, the national database in Sweden which makes information on a car’s annual inspection available. While these do capture some key points in the story of the car, obviously having the full story rather than a set of snapshots can give a more comprehensive view.
The Connected Car will make it possible to maintain accurate logs of all aspects of a car’s operation, taking a full set of sensor readings – these will be stored in the cloud. A potential purchaser of a car will be able to access this data to run some basic analysis to understand how the car has been used – do the logs correlate with the odometer readings? Was the driving behaviour erratic? Was the car’s performance consistent with the maintenance story that is being told? Has it degraded significantly over time? How does it compare with other similar models?
Accurate data on the car’s history will radically change the used car market. No longer will the buyer be suspicious of the stereotypical dodgy used car salesman: the data will speak for itself. This, coupled with other online reputation systems, will make it easier to identify stand up guys selling quality used cars. Direct sales will likely see a resurgence as one of the main values of the dealer – identifying good quality cars – can largely be done through web tools.
Of course, this won’t happen overnight, but the cost-benefit trade-offs in keeping accurate driving logs will become compelling soon (especially when combined with incentives from the insurance industry) and they differ significantly from today’s approach to maintaining a high quality history of the car – expensive dealer services.