System, method, and computer program for forecasting residual values of a durable good over time

• US 10,410,227 B2
• Filed: 02/02/2017
• Issued: 09/10/2019
• Est. Priority Date: 08/15/2012
• Status: Active Grant

• Current Assignee: J.D. Power
• Original Assignee: ALG, Inc. (TrueCar, Inc.)
• Inventors: Strauss, Oliver Thomas, Hansen, Morgan Scott
• Primary Examiner(s): Miller, Alan S
• Application Number:
  US15/423,026
• Publication Number:
  US 20170148040A1
• Time in Patent Office: 950 Days
• Field of Search: 705 711- 742
• CPC Class Codes: G06Q 30/0202 Market predictions or forecasting for commercial activities
• CPC Class Codes: G06Q 30/0205 Location or geographical consideration
• CPC Class Codes: G06Q 30/0206 Price or cost determination based on market factors

Abstract

Systems, methods and computer program products for forecasting future values of an item, where an initial value for the item is determined, and then a baseline forecast for a future reference period is computed based on factors that include microeconomic data which is specific to an industry of the item and macroeconomic data which is non-specific to the industry of the item. The forecast may also be adjusted based on data for a set of competitive items. The forecast for the item is stored and is then made available to clients that can access the forecast to determine the expected future value of the item at some point in the future.

Claims

1. A method for production of automotive residual values, the method comprising:

determining a baseline value for a vehicle with a base configuration, the determining performed by a computer at a base time based on a market value derived from auction data;

determining, by the computer at the base time, a reference time period for value alignment with vehicles in a competitive set, the value alignment constrained by automotive industry-level frequencies, the automotive industry-level frequencies including a frequency for which macroeconomic data is updated;

determining, by the computer at the base time given a set of constraints, a constant width of time intervals, the set of constraints include a length of time constraint relating to the reference time period, and a frequency constraint relating to the frequency for which the macroeconomic data is updated;

determining, by the computer, a locality adjustment based on an average cost of vehicles in the automotive industry in a locality at a reference time and a local cost of vehicles in the automotive industry across a plurality of localities at the reference time;

obtaining, by the computer, any incremental values of modification to the base configuration of the vehicle;

producing, by the computer, a locality-adjusted value of the vehicle at the reference time, the producing comprising adjusting the baseline value associated with the base configuration to account for any modifications to the base configuration of the vehicle and to account for the locality adjustment;

determining, by the computer, an adjustment for macroeconomic variables at the reference time based at least in part on the macroeconomic data collected at the base time;

determining, by the computer, an adjustment for microeconomic variables at the reference time based at least in part on the microeconomic data collected at the base time;

generating, by the computer, a residual value of the vehicle at the reference time with the adjustment for the macroeconomic variables at the reference time and the adjustment for the microeconomic variables at the reference time; and

communicating over a network the residual value of the vehicle at the reference time to a graphical user interface on a client device.

2. The method according to claim 1, further comprising:

constructing competitive sets of similar and substitute vehicles in the automotive industry, the constructing comprising determining factors to compare to for each competitor, establishing a matrix of vehicle features, and performing a matrix analysis on the matrix.

3. The method according to claim 2, further comprising:

determining a quality assurance adjustment based at least in part on an average residual value of a competitive set of the competitive sets, the residual value of the vehicle at the reference time, and a baseline of a closest competitor from the competitive sets; and

applying the quality assurance adjustment to the residual value of the vehicle at the reference time.

4. The method according to claim 1, further comprising:

determining natural depreciation values for the vehicle over time based on historical data, wherein the residual value of the vehicle at the reference time accounts for the natural depreciation values.

5. The method according to claim 1, wherein the auction data comprises auction records from data sources external to the computer.

6. The method according to claim 1, wherein the computer collects in a data store data of a plurality of data types from various data sources, the plurality of data types including the modifications, the locality, the macroeconomic data, and the microeconomic data.

7. The method according to claim 1, wherein the microeconomic data is specific to the automotive industry and wherein the macroeconomic data is not specific to the vehicle or to the automotive industry.

8. A system for production of automotive residual values, the system comprising:

at least one processor;

at least one non-transitory computer-readable medium; and

stored instructions translatable by the at least one processor to perform;

determining a baseline value for a vehicle with a base configuration, the determining performed at a base time based on a market value derived from auction data;

determining, at the base time, a reference time period for value alignment with vehicles in a competitive set, the value alignment constrained by automotive industry-level frequencies, the automotive industry-level frequencies including a frequency for which macroeconomic data is updated;

determining, at the base time given a set of constraints, a constant width of time intervals, the set of constraints include a length of time constraint relating to the reference time period, and a frequency constraint relating to the frequency for which the macroeconomic data is updated;

determining a locality adjustment based on an average cost of vehicles in the automotive industry in a locality at a reference time and a local cost of vehicles in the automotive industry across a plurality of localities at the reference time;

obtaining any incremental values of modification to the base configuration of the vehicle;

producing a locality-adjusted value of the vehicle at the reference time, the producing comprising adjusting the baseline value associated with the base configuration to account for any modifications to the base configuration of the vehicle and to account for the locality adjustment;

determining an adjustment for macroeconomic variables at the reference time based at least in part on the macroeconomic data collected at the base time;

determining an adjustment for microeconomic variables at the reference time based at least in part on the microeconomic data collected at the base time;

generating a residual value of the vehicle at the reference time with the adjustment for the macroeconomic variables at the reference time and the adjustment for the microeconomic variables at the reference time; and

communicating over a network the residual value of the vehicle at the reference time to a graphical user interface on a client device.

9. The system of claim 8, wherein the instructions are further translatable by the at least one processor to perform:

constructing competitive sets of similar and substitute vehicles in the automotive industry, the constructing comprising determining factors to compare to for each competitor, establishing a matrix of vehicle features, and performing a matrix analysis on the matrix.

10. The system of claim 9, wherein the instructions are further translatable by the at least one processor to perform:

determining a quality assurance adjustment based at least in part on an average residual value of a competitive set of the competitive sets, the residual value of the vehicle at the reference time, and a baseline of a closest competitor from the competitive sets; and

applying the quality assurance adjustment to the residual value of the vehicle at the reference time.

11. The system of claim 8, wherein the instructions are further translatable by the at least one processor to perform:

determining natural depreciation values for the vehicle over time based on historical data, wherein the residual value of the vehicle at the reference time accounts for the natural depreciation values.

12. The system of claim 8, wherein the auction data comprises auction records from data sources external to the computer.

13. The system of claim 8, further comprising:

a data store storing data of a plurality of data types from various data sources, the plurality of data types including the modifications, the locality, the macroeconomic data, and the microeconomic data.

14. The system of claim 8, wherein the microeconomic data is specific to the automotive industry and wherein the macroeconomic data is not specific to the vehicle or to the automotive industry.

15. A computer program product for production of automotive residual values, the computer program product comprising at least one non-transitory computer-readable medium storing instructions translatable by at least one processor to perform:

determining a baseline value for a vehicle with a base configuration, the determining performed at a base time based on a market value derived from auction data;

determining, at the base time, a reference time period for value alignment with vehicles in a competitive set, the value alignment constrained by automotive industry-level frequencies, the automotive industry-level frequencies including a frequency for which macroeconomic data is updated;

determining, at the base time given a set of constraints, a constant width of time intervals, the set of constraints include a length of time constraint relating to the reference time period, and a frequency constraint relating to the frequency for which the macroeconomic data is updated;

determining a locality adjustment based on an average cost of vehicles in the automotive industry in a locality at a reference time and a local cost of vehicles in the automotive industry across a plurality of localities at the reference time;

obtaining any incremental values of modification to the base configuration of the vehicle;

producing a locality-adjusted value of the vehicle at the reference time, the producing comprising adjusting the baseline value associated with the base configuration to account for any modifications to the base configuration of the vehicle and to account for the locality adjustment;

determining an adjustment for macroeconomic variables at the reference time based at least in part on the macroeconomic data collected at the base time;

determining an adjustment for microeconomic variables at the reference time based at least in part on the microeconomic data collected at the base time;

generating a residual value of the vehicle at the reference time with the adjustment for the macroeconomic variables at the reference time and the adjustment for the microeconomic variables at the reference time; and

communicating over a network the residual value of the vehicle at the reference time to a graphical user interface on a client device.

16. The computer program product of claim 15, wherein the instructions are further translatable by the at least one processor to perform:

constructing competitive sets of similar and substitute vehicles in the automotive industry, the constructing comprising determining factors to compare to for each competitor, establishing a matrix of vehicle features, and performing a matrix analysis on the matrix.

17. The computer program product of claim 16, wherein the instructions are further translatable by the at least one processor to perform:

determining a quality assurance adjustment based at least in part on an average residual value of a competitive set of the competitive sets, the residual value of the vehicle at the reference time, and a baseline of a closest competitor from the competitive sets; and

applying the quality assurance adjustment to the residual value of the vehicle at the reference time.

18. The computer program product of claim 15, wherein the instructions are further translatable by the at least one processor to perform:

determining natural depreciation values for the vehicle over time based on historical data, wherein the residual value of the vehicle at the reference time accounts for the natural depreciation values.

19. The computer program product of claim 15, wherein the auction data comprises auction records from data sources external to the computer.

20. The computer program product of claim 15, wherein the microeconomic data is specific to the automotive industry and wherein the macroeconomic data is not specific to the vehicle or to the automotive industry.