Length of rental (LOR) has decreased by 1.4 days to 16 compared to Q2 2023, but is still high above pre-pandemic figures, according to Enterprise Mobility’s latest LOR report for Q2.

Traditionally, LOR continues to decrease from Q1 into Q2 followed by an increase in June, according to the report. Enterprise said the trend continues minus the traditional rise in June.

Alaska had the highest overall LOR in Q2 2024 at 20.7 days followed by 19.4 days in Colorado and West Virginia. New Mexico was close behind at 19.2 days.

North Dakota had the lowest LOR at 11.1 days followed by Washington, D.C. at 12.3 days and Iowa at 12.6. Montana had the largest LOR drop — down 3.1 days from Q2 2023 to 16.7. Washington was close behind, recording a drop of 2.9 days to 16.3.

Only West Virginia had an LOR increase in Q2 2024 compared to Q2 2023, up one-half day to 19.4 days.

John Yoswick, CRASH Network editor, noted in the report that the average backlog of work fell nearly nine days between Q1 and Q2 which is the largest decline since the 10-day drop during Q2 2020 when COVID-19 pandemic lockdowns began.

The average scheduling backlog is now 2.7 weeks — three weeks shorter than the high of 5.8 weeks reached in Q1 2023.

“That said, a 2.7-week average remains higher than any quarter prior to mid-2021, and nearly double the historical second quarter average of 1.4 weeks,” Yoswick said. “Backlogs typically rise from Q2 to Q3 each year, so if the decline continues this summer, that will be surprising.”

Delivery days for all part types also decreased and didn’t show the traditional “June bump” in line with LOR data, according to Greg Horn, PartsTrader chief industry relations officer.

“We are seeing the collision parts ecosystem working well, having recovered from issues at the west coast shipping ports and the UAW strike in 2023,” Horn said. “However, a situation to monitor is the potential of an East Coast and Gulf Coast dock strike this year. Hopefully, a deal can be reached to avoid any work stoppages.”

During a “Collision Repair in Focus” webinar last week, Horn said the strike would impact seven of the top 10 ports in the United States.

“It will impact not only the aftermarket coming in from Taiwan — because they do come through the Panama Canal to make some deliveries to the East Coast — but it’s also going to impact European manufacturing,” he said.

He added this would also impact vehicle components manufactured in Alabama and South Carolina.

According to Ryan Mandell, Mitchell International director of claims performance, the average first-party claim deductible amount continues to climb. That could mean fewer claims might be filed or first-party coverage dropped, especially as premiums have increased dramatically, he said.

“In the U.S., the average first-party deductible rose to $832 in Q2 2024, up from $700 in Q2 2023,” Mandell said. “This is the largest YOY jump ever witnessed in our data.”

In Q2 2024, drivable LOR was 14.6 days, a 0.9-day drop from Q2 2023’s 15.5 days, according to the report. However, comparing Q2 2024 to Q2 2021, drivable LOR has increased 3.1 days.

Non-drivable LOR was 22.4 days in Q2 2024, a 3.2-day decrease from Q2 2023. In Q2 2021, non-drivable LOR was 18.7 days, or 3.7 days lower than this quarter’s results.

Vermont had the only non-drivable LOR increase, with their 28.6-day result representing a 2.5-day jump.

Yoswick said a sign of work slowing down at shops is seen in 2024 revenue expectations. Based on the first five months of the year, revenue hit a four-year low in June, according to CRASH’s quarterly survey.

Fifty-four percent of about 400 shops that responded to the survey said they expected revenues to be higher this year compared to 2023 including 33% who expected an increase of 10% or more. However, that was down from the same survey’s findings in Q2 2023. At that time, 83% expected higher year-over-year revenues, which was also down from the same period in 2022 (79%) and 2021 (66%), Yoswick said.

“Shops may be working through their backlog more quickly than they did in recent years because of successful hiring,” he said. “There were 99,540 body technicians employed in the industry by mid-2023, an increase of more than 8,000 in just one year, according to the Department of Labor.

“The number of painters in the industry rose by 1,130 during the same period, nearly a 5% increase over the prior year.”

LOR for rentals associated with total loss claims was 14.7 days, down 1.8 days from Q2 2023.

Vermont had the highest total loss LOR at 19.2 days followed by Hawaii (18.9) and West Virginia (17.9).

South Dakota had the lowest LOR at 11.6 days followed by North Dakota (12.3) and Nebraska (12.9).

Washington D.C. had the highest total loss LOR increase, with its 17.2-day result representing a 3.7-day rise.

Images

Featured image credit: ArLawKa AungTun/iStock

Graphs provided by Enterprise Mobility