Why you must insist on a vehicle history report when buying used

Second-hand car buyers have various resources to help them avoid ending up with a lemon.

Among these is a vehicle history report, a service offered by multiple third-party providers.

A global risk and information solutions service provider recently touted the return of accident history information on its vehicle verification offering.

According to TransUnion Africa auto information solutions division sales manager Hennie Strydom, the component was removed some years ago despite objections from the insurance sector.

Strydom said certain “nuances” had been addressed, namely questions about protection of personal information.

Customers trading in a vehicle now need to give consent to dealerships purchasing their vehicle for the information to be accessed.

“That opens up a whole new world; if the consumer doesn’t give consent, there’s something wrong,” he said during an interview with TimesLIVE Motoring.

“Our vehicle verifications report has been around since 1992, centred on mitigating fraud, giving dealers and consumers comfort about vehicle details, including theft history.”

The return of accident history data will enable dealerships and buyers to see where damage was recorded on the vehicle and the cost of repair.

“There is the preconceived idea that the motor industry conducts itself in a manner that is not acceptable; we brought the product back as part of our strategy of information for good.”

The data is pulled from a central vehicle industry data service provider.

Strydom said prospective used car buyers would be able to ask retailers to procure a report on a vehicle they are interested in — for which the dealership pays R45.

If they are unwilling to do this, the customer can use the First Check platform at a cost of R99 for a vehicle verification report.

Strydom believes the return of detailed accident history information would help filter out dubious stock on showroom floors of respectable “top-tier” dealerships.

He conceded there would unavoidably be a percentage of vehicles that slip through the system, in cases where owners opted for repairs outside channels of their insurance agreements.

While the data is pulled from a central source — meaning there are other parties offering to facilitate the same service — Strydom believes the reputation his company will augur well.

“We are the biggest credit bureau in South Africa. We have a host of data, by far the biggest in the country, we have a good footprint on vehicle information.”

So what has the response been from the dealerships TransUnion Africa serves?

“The reality is there are dealers who don’t want it, because if they know they’ll have to disclose. Then there are dealers who are super excited, they are going to on-board it and it fits their values — ‘top-tier’ and ‘middle-tier’ dealer groups that run ethical businesses.

“We’ve had good feedback in how it will add value and help them regain the trust between them, the buyer and the person trading in the vehicle.

“It will help them understand what they are buying, even if it is a vehicle that was accident damaged and perhaps properly repaired through the correct channels.”

How does the offering differ from information on the Vehicle Salvage Database that was recently launched?

“The salvage data is not always as transparent and open, with no consent required, which raises questions,” he said.

“This accident data is linked by vehicle and the VIN through a trusted platform and you can see where the accident happened, so you if you know it was right rear or left front, you can inspect the quality of repairs and make an informed decision. That’s the difference, it’s more targeted and accurate.”

Having reported on many incidents of undisclosed accident damage — and customers who buy these vehicles unaware — we asked Strydom if there were statistics about the used car industry and what percentage of cars on the market were accident damaged and repaired.

He said in theory, TransUnion could study its database within certain time parameters to ascertain such figures.

“The data exists, but there’s a question around consent, so you’ve got to take a host of things into consideration.”

Strydom also emphasised the distinction between cars with an accident history that were repaired to manufacturer standards through the correct channels, including minor incidents, and fixes done in a shoddy manner, possibly also involving unaddressed structural damage.

We asked him about the possibility of dealerships using information against trade-in customers.

For example, in the case of a vehicle which might have had a bumper bashing that was repaired to specification which the dealership uses as a justification for a lower valuation.

“If the consumer can prove it was repaired correctly they shouldn’t be penalised. It’s a different story if the dealer can see misaligned panels, overspray and structural damage which hasn’t been fixed correctly.

“If the dealer has no repair work or additional work to do there’s no reason to penalise the customer trading in.

“That is where both parties — dealer and consumer — don't see eye-to-eye and that was the issue when [accident history data] was taken away; insurers felt their customers were being penalised.

“But the other side of the coin is, if I’m buying a vehicle, I have a right to know its history. A lot of dealers might not like the process but the industry is ready for transparency to correct past injustices.”

After the face-to-face interview, TimesLIVE Motoring reached out to TransUnion Africa's communications team to clarify certain points before publication:

First, the name of the central vehicle industry data service provider from where accident history is pulled, which the company said it could not disclose.

“While we can't disclose the specific name of the central service provider in press releases, we can express our confidence in the data source and its compliance with industry standards. Rest assured, we prioritise secure and responsible data management.”

Second, how did TransUnion Africa manage to persuade its insurance company stakeholders to allow the sharing of accident history information again?

Its response:

“We understand the importance of stakeholder buy-in. TransUnion Africa has engaged in extensive discussions with insurance companies, emphasising the value of consumer consent and robust data management practices that comply with legislation. This collaborative approach has fostered a comfortable environment for data sharing.”

TimesLIVE Motoring looked on the First Check website and saw the vehicle verification report service advertised but accident history wasn't among the bullet points of details it includes. What was the reason for it not being advertised?

“The accident history feature isn't listed on the First Check website. We're working with First Check's new ownership to integrate this data set into their platform. We expect a quick rollout to enhance the First Check experience for users.”

Last, we asked how many dealerships subscribe to TransUnion Africa's offerings. The company said it could not disclose this, but reported being “encouraged by the positive response from major dealership groups and continued traction in data”.