British Brands Advance in UK Vehicle Ownership Satisfaction Study

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Mark Lendrich

British automakers have made great strides in the past few years in terms of offering appealing product lines and improved service, which is something they’ve often struggled with in the past. Jaguar, for instance, ranks highest in vehicle ownership satisfaction for a second straight year, according to the 2013 UK Vehicle Ownership Satisfaction Study (VOSS) that is a collaborative effort produced by J.D. Power and What Car?, a website and magazine owned by the Haymarket Media Group in the UK.

In the UK, current forecasts predict that new-vehicle sales will increase nearly 18% during the next five years, according to analysis from our strategic partner LMC Automotive. This puts British brands in a beneficial position to retain current customers and attract new buyers.

The 2013 UK VOSS, which is based on 16,104 online evaluations by original vehicle owners in the UK after an average of two years of ownership, examines customer satisfaction with vehicle and dealer service, based on the evaluation of four key measures. The measures and their weights in the overall index are: vehicle appeal (31%), which includes performance, design, comfort and features; ownership costs (25%), which include fuel consumption, insurance and costs of service/repair; service satisfaction (22%); and vehicle quality and reliability (22%). Continue reading ›

Insurance Websites Offer More Satisfying Service vs. Shopping Experience

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Jeremy Bowler

More than half of all insurance shoppers today use the Web to scout their options and many also go further to seek to obtain quotes online, according to our J.D. Power research. However, our 2013 Insurance Website Evaluation Study (IWES), which measures online customer experiences in performing both shopping and service tasks*, finds that requesting a quote and finding policy information are two of the most difficult tasks listed by auto insurance customers.

The good news is that auto insurance customers who have an existing policy find it easier to use their provider’s site to view policies, change contact information and pay premiums rather than using a provider’s site to shop for a policy. We find that customers who have a good experience are more likely to return and recommend the website.

Among the 20 insurance provider websites examined in the study, Esurance, Progressive and GEICO perform particularly well in the ease of use for both shopping and servicing with their websites. Continue reading ›

How Important is the Internet to Attracting New Vehicle Shoppers in the U.S.?

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Tim Dunne

With sales of new light vehicles in the United States continuing to rebound from the great recession years (light-vehicle sales are up 7% in the first trimester of 2013, after having increased 13% in 2012), one question that automotive marketers might be asking themselves is: How important is the Internet to attracting new-vehicle shoppers?

Based on J.D Power’s 2012 Sales Satisfaction Index (SSI) Study, four out of five new-vehicle buyers are Automotive Internet Users (AIUs)—people who use the Internet to shop for their new vehicle. By far, the most frequently accessed automotive content on websites and mobile apps are vehicle pricing information (64% of shoppers say they search for this information), and model information such as vehicle options, features and technical specifications (63% search for this information). Other popular uses in the online shopping experience include vehicle comparisons (48%), build-a-vehicle, and photo galleries (each 46%). Continue reading ›

Canadian Dealer Financing Satisfaction Reaches Record Level in 2013

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Lubo Li

As the economy in Canada improves and dealers have been able to sell more new vehicles, Canadian dealer financing satisfaction continues to improve from 2012 across all four segments measured—Prime Retail Credit; Retail Leasing; Floor Planning; and Sub-Prime Retail Credit.* In fact, according to our 2013 Canadian Dealer Financing Satisfaction Study,SM dealer satisfaction with finance providers in Canada is the highest it has been since the study was first conducted in 1998.

Overall dealer satisfaction in each of the four segments advances by more than 20 points from 2012. Canada’s dealers are most satisfied with floor planning support in 2013; Floor Planning improves by 21 points from 2012 to 910 (on a 1,000-point scale). Prime Retail Credit and Retail Leasing satisfaction each climb by 24 points to averages of 883 and 858, respectively. Sub-Prime Retail Credit also advances from 2012 by 19 points to 846.

After achieving near-record auto sales (1.67 million units) in 2012 and recording strong deliveries in the first quarter of 2013, Canada’s dealers are optimistic about their business. Our company’s Power Information Network® (PIN) finds that three of four dealers anticipate that their sales will increase in 2013 from 2012. Continue reading ›

Large Pickup Demand Spurs May U.S. Light-Vehicle Deliveries

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John Humphrey provide an auto industry outlook during a J.D. Power International Automotive Roundtable conference.

Demand for large pickups helped drive sales ahead in the first 16 selling days of May, according to a monthly sales forecast update from J.D. Power’s Power Information Network® (PIN) and strategic forecasting partner LMC Automotive.

Through the first half of the month, large trucks account for 11.4% of the industry’s retail sales, which is nearly 10% stronger than a year ago and up from an already robust 11% share of retail sales in April 2013. A year ago, large pickups comprised only 9.7% of the industry’s retail sales mix.

Higher sales of these full-size pickups also is helping to keep the industry’s average transaction prices at record levels. The average transaction price for all new vehicles to date in May is $28,921, the highest ever for any month of May and 3% higher than May 2012, based on our PIN data. Continue reading ›

Hybrid Vehicles Face a Bumpy Road in Southeast Asia

bangkok-thailandThree years ago, Toyota Group began producing and selling the first hybrid model—a Camry—in Thailand. Since then, sales of hybrid cars in that country have grown significantly. In 2012, hybrid sales in Thailand were 19,000 units. Sales of hybrids in Thailand have been growing at an average rate of almost 60% during this time frame. Now, there are at least four hybrid models being sold in the Thai market, and this year hybrid vehicle sales are projected to surpass 20,000 units.

Despite strong and stable growth, a volume of 20,000 unit sales is miniscule in a country where projected sales volume in 2013 is 1.2 million light vehicles. The hybrid vehicle sector accounts for only a 1% share of the entire domestic market (3% of passenger-vehicle volumes). This is very small compared with an 18% hybrid share in Japan, the home market of the key OEMs that have sales operations in Thailand. To be fair, the ratio of hybrid vehicles in Malaysia, a key competitor for regional production of hybrids, amounted to just 2%, or sales of 15,000 units, last year.

Currently, we expect the market share of hybrid cars in Thailand to be under 5% for the foreseeable future. Our projection for hybrid sales in 2020 is slightly over 30,000. In comparison, hybrid vehicle sales in Malaysia are likely to nearly reach 50,000 units by 2020, and will account for almost 10% of that country’s passenger-vehicle market. Continue reading ›

SUVs Continue to Sell in China Despite Smog Concern

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Tim Dunne

The best-performing segment in China during the first quarter of 2013 was the SUV segment, which saw sales surge by 43% from the same quarter in 2012. New product launches added momentum to demand in this category. As mentioned in an earlier post, total passenger-vehicle sales rose 14% during the same period.

SUVs accounted for nearly one-fifth (19%) of the first-quarter sales volume in China, according to analysis from our strategic partner LMC Automotive.

In general, bigger is always better in China, as size implies power, prestige and influence. Chinese consumers also like the high seating and extra room that SUVs provide, and China’s middle-class consumers see SUVs as a safer option on the country’s less than ideal roads, says China auto analyst Michael Dunne in a recent article in The Wall Street Journal.

New fuel-efficiency regulations enacted by China’s government to curb air pollution are based on the weights of vehicles. But these new rules include easier targets for heavier vehicles, which may be an incentive for manufacturers to build more SUVs. This same sort of situation happened in the U.S. market during the ’80s and early ’90s when fuel-efficiency standards were not as strict for heavier vehicles. Continue reading ›

Interest Grows for In-Vehicle Connectivity through Smartphones

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Mike VanNieuwkuyk

The level of purchase interest among vehicle owners with smartphones for device/application link technology to connect and integrate their smartphones with their vehicles infotainment systems continues to rise for very practical reasons, according to our 2013 U.S. Automotive Emerging Technologies Study.

Vehicle owners’ interest in connectivity and, in particular, the smartphone device/application link feature, is all about functionality. Research conducted by J.D. Power’s Consumer Insight and Strategy Group to track social media discussions about new technologies, including device/application link, suggests that consumers believe their in-vehicle infotainment systems lack the technology that their smartphones and tablets have.

Consumers also desire more mobile apps and want the capability to control their own software updates to integrate with their vehicle systems. Another interesting discovery from social media conversations on this topic is that consumers want their vehicle infotainment systems to be powered by their smartphone in order to avoid an additional monthly charge as well as to keep their technology up to date. Continue reading ›

J.D. Power Expert Talks about Tires in Indian Market

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Mohit Arora

Recently, Mohit Arora, executive director of J.D. Power Asia Pacific in Singapore, offered some insight, advice and tips on tire safety, cost efficiencies and ride comfort, based on J.D. Power tire customer satisfaction research in India. Some highlights from Mohit’s discussion related to analysis and research from the 2013 India Original Equipment Tire Customer Satisfaction Index (TCSI) Study are excerpted.

Arora begins by asking three key questions related to tires that customers in India should consider and then offers insight, tips and advice based on J.D. Power Asia Pacific tire studies and research.

Fuel Economy—Excessive fuel consumption has always been the top reported problem in our studies and will continue to be so in light of rising fuel costs. Does the average car owner in India know how to optimize fuel economy from their tires?

Importance of Tire Rotation—Some 40% of drivers report that they do not rotate their tires in an ownership period of 12 to 24 months. Tire rotation impacts fuel economy, tire durability and driving safety. Why is tire rotation important and at what frequency should it be done?

Run-Flat Tires—Nearly three-fourths of respondents say that run-flat tires are very important and express a need for them. Does the average driver actually know what run-flat tires are and why they are needed? Continue reading ›

Premium Brands Try Downsizing Strategy in India Market

Ammar Master

The market share of premium vehicles in India is miniscule. However, premium brand automakers are aiming to increase share by building smaller, locally built, lower-priced models. This trend towards downsizing is not new, but it is likely to be more pronounced in India, which is probably one of the most cost-conscious markets in the world. Also, it’s evident globally that luxury vehicle makers have been moving toward smaller-size models for a number of reasons.

Jonathan Poskitt, head of European Sales Forecasting at LMC Automotive, points out, “There are a few important reasons why premiums have been expanding into smaller segments. One has been that premium brands aim to incrementally increase market

share. To do this there was a renewed focus on smaller cars, both by premium brands and the wider market generally, when European Union CO2 legislation became more concrete late in the last decade.”

In addition to what Poskitt has mentioned, regulatory measures are also partly driving the need for more localization in India. In this year’s Budget 2013, India’s Finance Minister raised the import duty for luxury cars to 100%, from 75%. Continue reading ›