New car database a bonanza for Canadian auto industry

Serendipity has played a big role in the creation of a comprehensive Canadian automotive database by Edmonton-based software developer VIN IQ Inc.

Set to launch later this month, the database will provide a central e-repository of aggregate information to a wide array of industry players: car dealers, finance and insurance companies, repossession firms, government agencies and law enforcement.

The story begins with VIN IQ’s sister company, Live Global Bid, an online auction company based in Moose Jaw, Sask. that hosts and services around 80 per cent of all online automotive auctions in North America, says Rob Orr, CEO of VIN IQ.

Car dealers participating in their auctions complained about a major back-end problem: recording a car’s condition and its Vehicle Identification Number (VIN) – a 17-character alphanumeric bar code identifier introduced by car manufacturers in the 1980s – is a tedious, manual, error-prone process that creates bottlenecks for dealers who may have hundreds of cars to auction off.

So the company developed an automated, intelligent system to accurately scan VIN bar codes, capture a car’s information on to Palm pilots and download it to PCs. They then went looking for a database to hook it up to, says Orr. They found an Edmonton company that had spent the past decade building a massive North American automotive database in a state of “extreme insolvency”, bought it out, cleaned up the database, and created a new company, VIN IQ, in the fall of 2004.

Then serendipity struck.

One by one, like prairie dogs poking their heads out of their burrows to sniff something new in the air, car industry players have stepped forth and expressed an interest in partnering with VIN IQ and contributing their silos of information to help create a truly comprehensive electronic repository of automotive information. Searching for vehicle information in general is a fragmented, mostly manual process, and VIN IQ offers an irresistible feature: “The power of our database is that it recalibrates itself when new information is added,” says Orr.

Canadian Black Book (CBB) is a partner organization that provides information about the cash values of used vehicles to dealers, insurance companies and banks. CBB information enhances the value of VIN IQ’s database and in turn helps CBB gain access to a wider audience. “We charge a fee for the use of our material, so the more VIN IQ units in use out there, the better,” says Larry Shred, executive director at CBB.

VIN IQ also has partnering arrangements with RepoHighway.com and other companies involved in the repossession of vehicles, and CarProof, a London, Ont.-based company that provides electronic car history reports. These reports allow dealers to find out if there are loans, leases and liens on a vehicle. The company is also in discussions with law enforcement to add stolen vehicle lists to the database. “If we can also add police information, then we can tell upfront if a car is on theft or repossession lists,” says Orr.

The company has also had discussions with the Insurance Bureau of Canada (IBC) and the Alberta government, who are very interested in the system to combat auto theft. “Alberta seems to be the auto theft leader in Canada – not in theft per se, but as a [receiver] of stolen cars from other areas. A lot seem to land here to get shipped offshore or slipped through auctions,” says Orr. According to the IBC, vehicle theft costs Canadians $600 million in higher insurance premiums every year.

The company plans to present its wares to the Ontario government and several US states that require recording of the VIN and collection of pictures and history when a car is registered for insurance purposes. “They’re doing that with clipboards and digital cameras now, but we can totally automate the process, plus bring accuracy, speed and more information.

That’s why we’re a natural for government agencies, compared to trying to create their own,” says Orr. The initiative is gaining serious momentum as more and more players learn of VIN IQ’s offerings. “We originally just started out wanting to license a database for our auction site. So even though we’re just getting out of the gate now, we’re able to offer all this other information,” says Orr.

Thanks to a multi-million dollar, five-year year deal with Telus, a Vancouver-based telecommunications leader, VIN IQ will focus its efforts on system enhancements, database development and relationship building, while Telus looks after all back-end functions.

“We’ve worked with VIN IQ to help create and host the database and the billing system. We’ll be supporting the company with a 7/24 North American help desk, and we’ll also be handling the provisioning of equipment to customers,” says Monty Carter, managing director at Telus Business Solutions. “I’ve been in the car business and can speak first-hand to issues. VIN IQ has come up with an amazing, cool tool.”