US Market: Trade-in Percentages Up, Lower APRs Remain Popular

Grace Hamulic

In October 2011, more than one-half (53.6%) of all new-vehicle deals included a trade-in, up from 49.9% of deals in October 2010, according to Power Information Network® (PIN) retail transaction data from J.D. Power and Associates. It’s noteworthy that during the past year, PIN data indicates that the percentage of trades with negative equity (amount owed on trade-in that is greater than the vehicle’s value) continued to drop. About 22.5% of trade-ins were upside down in October, which was down from 23.2% in the same month a year ago. The new-vehicle sales outcome in October was brighter this year than a year ago.

A few more highlights gleaned from PIN retail transaction data in October this year vs. the same month in 2010 are summarized:

• It’s likely that more buyers and lessees replaced their current older vehicles in October 2011, since the average age of a trade-in from all nameplates rose to 6.5 years from an average trade-in vehicle age of 6.4 years in October 2010. The trade-in vehicle age does not appear to have changed much.

• Interestingly, the age of luxury vehicle trades in October 2011 was younger than the industry overall—averaging 5.3 years old vs. 6.5 for the industry. Continue reading ›

Rental Car Customer Satisfaction Returns to Near-2006 Levels

Jessica McGregor

Customer satisfaction with renting vehicles at North American airport locations has returned to near-2006 levels, after regaining ground in 2010 from declines during the 2-year downturn in 2008 and 2009, according to our 2011 North America Rental Car Satisfaction Study. Satisfaction increases from 2010 across all six factors* measured in the study.

The industry average satisfaction score improves this year by 8 points to 758 (on a 1,000-point scale) from an average of 750 in 2010 after achieving much lower scores in 2008 (734) and 2009 (733). In addition to an increase in satisfaction with rental car companies this year, customer loyalty and advocacy have also made a comeback, remaining steady with 2010 levels. Continue reading ›

Satisfaction: Much Higher for Prompt Vehicle Service in Australia

Mohit Arora

Vehicle owners in Australia who wait less than 3 hours to have their vehicle serviced at an authorized service center are much more satisfied with the service experience than are those owners who are forced to wait longer, according to the J.D. Power Asia Pacific 2011 Australia Customer Service Index (CSI) Study.SM

In fact, service satisfaction* for shorter vehicle service wait times is 41 points higher (817 points on a 1,000-point scale) than for wait times of 3 or more hours (776). At the same time, the study reveals that nearly six in 10 customers (59%) have to wait more than 3 hours before their vehicle is returned to them after service, and customers wait an average of 6 hours for their vehicle to be serviced. Continue reading ›

Original Programming, Branded Content Drives Consumer Interest

Partnering with quality content providers is a model that works to develop original programming and branded entertainment across different platforms, according to a panel of five media experts during a presentation on the future trends in advertising and media. During the recent 2011 Automotive Internet Roundtable in Las Vegas, NV, the five experts presented trends and ideas about original programming and the media. Continue reading ›

What Lies Ahead for Automotive Marketers in the Age of Digital Marketing

The world of marketing is rapidly growing with a new age of marketers who will need to keep up with the changing environment. This new age of digital marketers will have a different mindset, tool set, and approach to digital marketing as exhibited in an interesting scenario.

There are seven new-age marketers ready to compete with their ideas for what is called the “Ultimate Marketing Championship” or UMC13, suggests Jason Deal, executive vice president and digital group account director at Initiative USA. He presented a fantasy portrait of these new-age marketers at this year’s 2011 Automotive Internet Roundtable. Continue reading ›

Passionate Users Influence Other Consumers

There’s a new generation of passionate and influential consumers in today’s market, suggests Matt Roseberg, vice president of solutions at SAY Media. He told auto industry members at the 2011 Automotive Internet Roundtable that these users following social media sites can be profiled: 70% are more connected; 15% are younger consumers; 17% have higher incomes; and 20% are better educated than the average consumer and social media user. This new group of passionate users has a voice and can influence a majority of others. Continue reading ›

Social Tools to Empower Female Car Buyers

Both males and females are adopting social media to gather information during their new-vehicle shopping process, but females are more passionate and articulate about their usage, according to findings from a recent study conducted by the BlogHer Network that was highlighted at this year’s 2011 Automotive Internet Roundtable in Las Vegas, NV.

Advice from social network blogs increases excitement, instills confidence, and reduces stress in many female new-vehicle buyers, based on the study, which surveyed 1,000 females and 377 males between the age of 18 and 76. Continue reading ›

Gathering Together to Talk About How to Reach Automotive Shoppers

Arianne Walker

Taking advantage of advances in digital technology and the convergence of platforms beyond the PC—particularly mobile— to attract automotive shoppers in the market for a new vehicle, was one of the hot topics discussed during the recent 2011 Automotive Internet Roundtable in Las Vegas, NV. Members of the auto industry, marketers, advertisers, and Internet-savvy experts gathered to network and to learn more about the evolution of technology and social media as it influences and impacts the auto industry and consumers, both now and in the future.

J.D. Power Experts Provide Extra Insight

Steve Witten

During the opening Automotive Marketing Overview, we covered how new-vehicle buyers are different from the general population in terms of demographics, and more importantly in their behavior. We presented our latest data and information about Internet usage in the shopping process and pointed out the challenges in the online lead process, as well as listing details about mobile and tablet usage.

Following the overview, some questions were asked by members of the audience:

Q: Is there technology that can ID a mobile lead (vs. desktop lead)?


A: Perhaps the question should be: why would you ask shoppers to fill out an online lead form from a mobile device? Click-to-call would probably make more sense. We suggest skipping form completion in this scenario and getting the shopper in contact with the dealer directly. And, while you are at it, use a different phone number for your mobile site versus your traditional internet site—giving you a way to measure how many calls come in from different sources. Continue reading ›

October Retail Sales Finish Slightly Ahead of Expected Pace

Robust light-vehicle sales in the US market during the final days of October helped push the month’s sales totals higher than anticipated, according to J.D. Power and LMC Forecasting analysis and data.* Retail deliveries averaged a 10.5 million-unit selling pace in October, which matched September’s retail sales pace. Fleet sales averaged nearly a 2.7 million-unit rate, which was up by 900,000 units from October 2010.

Total October deliveries (including retail and fleet) rose 11.5% from the same month a year ago to 1.02 million units from nearly 950,000 unit sales in the same month last year. The annual selling rate (SAAR) in October averaged 13.2 million units, which was 1 million units stronger than last October’s 12.2 million-unit pace. It was the strongest selling pace since February 2011. Continue reading ›

Five-Year Snapshot: Component Quality Advances and Satisfaction Rises

Andrew Bernhard

J.D. Power recently released its latest series of Component Quality Reports (CQRs), detailing owner-reported evaluations of the quality of their new vehicles and how satisfied they were with their 2011 model- year vehicle component areas after the first 90 days of ownership.

These CQR reports, which are based on analysis of Voice of the Customer data and findings from our annual Initial Quality Study (IQS) and the Automotive Performance, Execution and Layout (APEAL) Study, cover six major vehicle component areas: Seats/Seat Belts; Interior; Multimedia Systems; HVAC/Rear Defrost; Brakes/Driving Dynamics; and Engine/Transmission.

Notably, when results from the 2011 studies are compared to results from five years ago (2006), when the studies were redesigned, it is observed that quality has improved for five of the six component areas—significantly so for four of the six component areas—and satisfaction, or “things gone right,” has significantly improved in all six component areas.

Multimedia systems is the lone exception among the six component areas, declining significantly in quality, while manufacturers and suppliers continue to struggle with making more complex multimedia systems easier for owners to use and understand. However, as is the case with all other component areas, new-vehicle owners are still significantly more satisfied with their multimedia systems in 2011 compared to owners from the 2006 study.

Outlook and Implications for the Future

With the current landscape of in-vehicle communication and entertainment, the environment for the success of components has evolved. There has never been a complex component area like multimedia that requires such a robust and personal understanding of consumer behaviors and consumer expectations. More than ever, both OEMs and suppliers must understand how to assist and not hinder consumer connectivity. There will be some hurdles to overcome, but as long as the same quality metrics are aligned with improved consumer-driven product development requirements, the road for the next 5 years should improve. Continue reading ›