Frost & Sullivan recently conducted a survey to evaluate the dynamics impacting the North American salvage parts aftermarket, such as the insurance, collision and mechanical repair, remarketed vehicle, and the scrap vehicle industries.
In its 96-page report, titled "Strategic Analysis of the North American Automotive Salvage Industry," the business research and consulting firm offered many insights, including making the case for why the use of salvaged parts is not only advantageous to insurers but is also becoming more commonplace.
Citing the economic decline as a factor in lower used-vehicle prices, Frost & Sullivan analysts explained the corresponding dip in the actual cash value (ACV) of vehicles. Also compounding the issue is the rise in prices of raw materials. Because materials tend to be more expensive, repair costs are higher. In turn, this drives up the number of total-loss claims.
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