The year-over-year rate of digital adoption for contracting and transaction documentation in the U.S. auto market surged by 29% in Q2, according to Wolters Kluwer Compliance Solutions’ latest Q2 Auto Finance Digital Transformation Index. This growth occurred despite ongoing global economic uncertainty and a significant ransomware attack disrupting sales late in the quarter. The Index monitors the shift from paper-based processes to digital in auto finance.
Tim Yalich, Head of Auto Strategy at Wolters Kluwer, noted, “Reaching the midpoint of 2024, it’s clear that digital adoption is thriving even amid industry challenges. Automotive businesses are increasingly embracing digital strategies for their back-office operations. Despite the ransomware attack, many managed to pivot and stay digital, underscoring the critical need for digitization.”
The data shows a steady increase in digital adoption, with a 165% growth over the past four years. Although Q2’s growth rate compared to the previous quarter was a modest 3% due to seasonal industry patterns, the overall trend remains robust.
In the securitization markets, digital adoption also grew, with a 70% increase over four years. While digital auto loan volumes dropped 41% compared to Q1 2024, they rose 39% year-over-year. Improved performance in auto asset-backed securities (ABS), driven by tax refund season and increased prime issuances, contributed to this growth.
