The following interview with Copart UK’s Managing Director, Jane Pocock recently featured in Insurance Times.
Copart’s UK MD says a global client base is essential for sustainability and opportunity beyond 31 October, and how it can benefit its insurer and broker partners.
A global buyer base is going to play a prominent role in ensuring the salvage sector is able to handle the challenges and maximise the opportunities Brexit will bring.
That is according to Jane Pocock, Copart’s UK managing director, who said some effects of the referendum result from June 2016 are bringing benefits to the salvage sector.
She said there was evidence that falls in the value of sterling had already attracted more EU and overseas buyers of insurance categorised vehicles.
And she believes the heightened interest from foreign buyers will benefit insurers, post-Brexit.
She said: “The onset of Brexit has driven an increase in the number of overseas buyers registering with Copart; an average of 1100 non-UK buyers are signing up with us each month, which is up 30% year on year.”
Along with this, Pocock expects that interest to accelerate should the pound experience further falls in the lead up to 31 October and beyond.
Technology bringing better returns
Pocock explained that Copart’s live auction technology, which uses artificial Intelligence and machine learning, has improved returns for their insurer customers.
She said: “Technology has enabled us to access the biggest buyer base in the industry, with buyers across our 113 countries, including 81 non-EU domiciles and we invest in technology to validate all our buyers with a strict ‘know your customer’ process enabling us to audit our buyers.
Although Copart has a strong presence in the UK, with a large proportion of our buyers being located domestically, Brexit increases the importance of salvage companies like us being able to access an overseas base, because our insurer customers will benefit from the increased buying power of foreign parts procurers.”
She said that exports of salvage vehicles will be unaffected, as Copart adheres to EU legislation for the transfer and shipping of these vehicles.
She added: “We have no concerns about the strength of our supply chains.”
Benefits of an international client base
Pocock said this brings additional advantages to salvage businesses with a large foreign buyer base who can exploit the rise in the number of vehicles UK insurers send to salvage.
She explained: “The rising costs of repair, driven by price hikes for parts and labour, the capacity with the repair network and the increase in salvage returns we make for our customers has seen an increase in volume of vehicles insurers are choosing to sell off for salvage. As a result, Copart has invested in new capacity to handle additional loss volumes, providing over 400 acres for UK vehicle storage.”
Uncertainty increases demand
Finally, Pocock predicted that the demand for used parts will continue to increase, which will boost demand for salvaged vehicles to source parts both in the UK and beyond.
“Experience tells us that the demand for parts and used vehicles increases during economic downturns and uncertainty, and that currency fluctuations create opportunities for both EU and non-EU buyers,” she said.
“Looking ahead, our buyers, especially in non-EU countries, will hold the key to maximising salvage returns for our customers.”
Source: Insurance Times
Categories: Industry News