Jeff Liaw: On the volume question, and there are many different ways to slice this question into its component parts with our insurance sellers. As Gavin noted, in some meaningful detail, we are observing a literally once in a lifetime suppression of total loss frequency, which we believe will eventually abate and reverse very meaningfully. That, I think we would say, has stabilized. Driving activity has picked up. Depending on the country you’re talking about, it’s picked up a lot in Europe where the driving was more suppressed a year ago than it has been in the US. So driving frequency, times, accident frequency times, total loss frequency is plus or minus the volume equation plus the market share question that you posted a moment ago.
So, in the aggregate, I think we’re seeing stabilization on total loss frequency but still a year-over-year decline, and we’re seeing an increase in driving frequency and accident certainly are picking up as well. On the question of market share, we aren’t in a position. In general, we don’t comment on individual accounts. If you look at long-term arc of history, I’d say we generally speaking have earned more market share over the years both in insurance and outside of insurance. So, in our non-insurance businesses in which we serve automotive dealers, rental car fleets, financial institutions, among others, we believe we continue to gain share relative to other providers in that space.
Unidentified Analyst: Got it. Thank you. And then how do you guys see the competitive landscape changing with the RBA deal with IIA? Are there any synergies that you guys see?
Jeff Liaw: I’d say — I’ll generalize a half step here. We take our competition very seriously, and we view our competitors set expansively. So, in earning the right to sell vehicles on behalf of our clients, we compete against every other path those vehicles can take. So, whether it’s hand selling, retailing, repairs and certainly consignment through other wholesale auction platforms, so we are constantly investing and innovating to deliver the highest possible returns so that we win more of those head-to-head comparison against the alternatives and to eclipse the rising standards we set for ourselves as well. But to address your question specifically about another provider of auction services in the insurance space, we don’t think a change in corporate ownership particularly affects how each of us competes in the marketplace.
So, whether they are controlled by private equity or an activist hedge fund or one corporate holding company or another, we think our stability as a founder led independent company represents a durable and distinctive competitive advantage. In practice, we manage our business with a long-term investment horizon, which in turn creates the accumulating advantage of owning our own land, our technology platform, building a global buyer base in our team.
Unidentified Analyst: Got it. That’s helpful.
Jeff Liaw: Specifically, of course, those questions are better posed to the buyer and seller of that specific transaction.
Unidentified Analyst: Fair enough. Thanks guys.
Operator: The next question is from with JPMorgan. Please proceed with your question.
Unidentified Analyst: Hi, guys. on for Ryan Brinkman. I just had a question on how you guys are looking at margin compression given declining used vehicle values commodities. And is there anything you can do with — by — like adjustment retention rate, change that affect that?
Jeff Liaw: What rate?
Unidentified Analyst: Your retention rate or anything you guys can do to like offset margin compression?
Jeff Liaw: Do you mind just rephrasing that? I’m not sure I understand your question.
Unidentified Analyst: Yeah. So, given that used values — used vehicle values are normalizing lower along with commodities like, is there anything you guys can do on your side by adjusting your retention rate to offset that? Or how are you guys looking at that going forward?
