CarDr, an automotive diagnostics technology company, announced last week it has launched an Auction Arbitration Risk Report, which can help auctions and dealerships find hidden mechanical exposure before a car enters a sale.

This standalone diagnostic intelligence validates findings from vehicle scans against arbitration policies from the National Auto Auction Association, aiming to prevent avoidable issues spiraling to post-sale disputes.

CarDr’s Mechanical Intelligence platform analyzed a sample of 45,000 vehicle scans, uncovering more than 190,000 diagnostic faults that would represent potential repair exposure of more than $40 million — and many of these faults would not be seen through traditional appraisals, warning-light checks, vehicle history reports or basic code scans, the company said.

CarDr conducted a 150-vehicle pilot with an auction partner, who scanned each of those vehicles with the company’s Mechanical Intelligence platform and applied the Auction Arbitration Risk Report prior to the sale.

The auction realized a 30% increase in pre-sale inspection throughput, while also recording only three verified arbitrations on the 150 cars.

That’s half of the typical 4% wholesale benchmark for mechanical arbitrations, CarDr said. Based on the average mechanical arbitration cost of $1,500 per vehicle, the auction partner avoided roughly $4,500 in policy-loss exposure during the pilot.

“Every enhancement we develop starts with one question: how can we help our customers make better business decisions?” CarDr CEO Greg Lubrani said in a news release.

“This pilot is exactly what we hoped to prove — that turning diagnostic data into real operational intelligence doesn’t just reduce risk on paper, it changes outcomes in the lane.”