1. Odometer fraud is increasing, affecting 2.45 million cars nationwide. 2. Vehicles with rollbacks lose approximately $3,300 in value. 3. Top states for odometer fraud include Montana, Tennessee, and Arkansas. 4. CARFAX offers tools to help consumers check vehicle histories effectively. 5. S&P Global Mobility manages CARFAX, emphasizing consumer protection.
FAQ
Why Bullish?
The rise in odometer fraud increases demand for CARFAX services, indirectly benefiting SPGI.
How important is it?
The article highlights increasing issues within S&P Global's service domain, potentially enhancing SPGI's market presence.
Why Short Term?
Immediate consumer concerns may drive higher traffic to CARFAX, boosting revenue soon.
Significant Increase in Odometer Fraud: 2.45 Million Vehicles Affected
In an alarming trend for used car buyers, recent data from CARFAX indicates that approximately 2.45 million vehicles are suspected of odometer rollbacks. This represents a notable 14% increase from last year and a 4% rise from 2023 to 2024. With SPGI companies like CARFAX at the forefront of automotive history reporting, these statistics highlight a pressing issue in the used car market.
Understanding Odometer Rollbacks
Odometer rollbacks occur when individuals manipulate the mileage recorded in a vehicle's electronic systems, making the vehicle appear less driven than it truly is. Faisal Hasan, Vice President of Data Acquisition at CARFAX, explains, "As modern vehicles have transitioned from mechanical to digital odometers, tampering has unfortunately become more common due to the wider availability of inexpensive tools." The increased frequency of mileage recording has made it easier to identify discrepancies, ultimately protecting consumers.
Financial Implications for Consumers
This rise in odometer fraud is not only misleading but also financially detrimental. CARFAX reports that vehicles with a suspected odometer rollback see an average value loss of approximately $3,300. Unsuspecting buyers could face additional costs for unexpected repairs and safety risks, thereby compounding their financial burden.
States Most Affected by Odometer Fraud
The following states have recorded the highest numbers of vehicles suspected of odometer rollback:
- Montana: 33% increase
- Tennessee: 30% increase
- Arkansas: 28% increase
- Oklahoma: 25% increase
- Kansas: 24% increase
- New Jersey: 21% increase
- Florida: 20% increase
These statistics underscore the growing prevalence of this issue across various states, emphasizing the need for vigilance among buyers.
Protecting Yourself from Odometer Fraud
To safeguard against potential odometer fraud, CARFAX recommends several proactive measures:
- Conduct thorough research by pulling a CARFAX report to check vehicle history, title, maintenance, and inspection records for mileage verification.
- Use the CARFAX Odometer Check by entering the Vehicle Identification Number (VIN).
- Inspect wear and tear on the gas, brake, or clutch pedals as indicators of actual usage.
- Always have a trusted mechanic inspect the vehicle before purchasing to assess whether it appears older than the odometer suggests.
About CARFAX and S&P Global Mobility
CARFAX is part of S&P Global Mobility, which assists millions in shopping, buying, servicing, and selling used cars with innovative vehicle history solutions. Since its inception in 1984, CARFAX has evolved into a leader in vehicle history information, providing essential tools such as CARFAX Used Car Listings and the flagship CARFAX Vehicle History Report. S&P Global, traded under the symbol SPGI, is renowned as the world's foremost provider of credit ratings and analytics across various markets.