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 ›

J.D. Power’s O’Neill Sees Industry Revival with Rosier Sales in the U.S. Market

AutoForum- Fin O'Neill 1New-vehicle sales in the U.S. market have already recovered by more than 10% annually since 2010, Finbarr O’Neill, president of J.D. Power and Associates, said in remarks this week at the company’s 2013 Automotive Forum. The conference was sponsored with the National Automobile Dealers Association (NADA) at the Grand Hyatt Hotel in New York City before the New York International Auto Show* press briefings this week.

Total U.S. sales of cars and light trucks this year should surpass 15.3 million units, which is up from 14.4 million unit sales in 2012, O’Neill confirmed. He also said that new-vehicle sales are projected to surpass 16.4 million units by 2015.

O’Neill also told industry participants at the conference that retail light-vehicle sales are solid and increasing while the daily rental market and fleet sales are well under control, which is very different from the mid-2000 period, when manufacturers relied too heavily on discounts and fleets. At the same time, he said that J.D. Power’s data finds that the average transaction price of a new vehicle has increased by $3,500 since that period. Credit is looser, and leasing has risen to 23% of the sales mix, based on data collected by J.D. Power’s Power Information Network® (PIN). Continue reading ›

India’s New Budget May Hamper Local and Foreign Automakers

Much to the chagrin of the auto industry in India, the country’s Finance Minister P. Chidambaram in his 2013 Budget raised duties for utility vehicles (SUVs and MPVs) and fully-imported luxury cars.

India02The changes mean that excise duties for SUVs and MPVs were increased from 27% to 30%, excluding vehicles that are registered as taxis. In addition, India’s government now defines utility vehicles to be over four meters in length (slightly more than 13 feet or 157.5 inches); with 2.5L engine capacity and a ground clearance of at least 170 mm (6.7 inches).

This definition, especially the new criteria for ground clearance, also will subject certain passenger cars, including the Honda Civic and Maruti Suzuki SX4 to the higher duty, while at the same time allowing utility vehicles like Mahindra’s Quanto or Renault’s Duster to be taxed a lower rate.

In preliminary analysis of this change in the taxes, the SUV sales forecast for 2013 may be cut by up to 5%, although the long‐term outlook for the segment remains positive. The only silver lining is that upcoming compact SUVs (of less than four meters) may help offset some of the impact of this new higher excise duty on larger vehicles. Continue reading ›

Demand for Replacement Vehicles Spurs December U.S. Auto Sales

Car buyer gets keys from DealerDecember nearly always is a strong sales month in the auto industry, and this past year’s 12th month auto sales results were no exception. Consumers in the United States continued to replace their aging vehicles at a faster pace than in the previous year.

The month’s light-vehicle deliveries rose 13.3% from a year ago to 1.353 million units, which translates to a 15.2 million-unit seasonally adjusted annual selling rate (SAAR), nearly matching an earlier forecast from our Power Information Network® (PIN) and strategic partner LMC Automotive. Sales in December were also boosted by consumers replacing vehicles totaled or damaged in late October’s Hurricane Sandy super storm on the East Coast.

Two German Automakers Post Leading Sales Gains in December

December also remained a strong month for luxury deliveries, as anticipated in earlier J.D. Power analysis. Two European automakers, Volkswagen and BMW Groups, sold nearly 40% more new vehicles than they delivered in December a year ago. Volkswagen Group’s Audi and Porsche luxury brands posted stellar sales in December and for calendar 2012. Porsche’s sales rose by more than 60% from a year ago. In addition, the mass-market VW brand was helped by strong sales of newer models such as the U.S.-made Passat and the Jetta. Continue reading ›

Hybrid and EV Sales Charge Ahead in U.S. Market

In August, buyers bought and leased more than twice as many new vehicles with alternative powertrains as they did a year ago, according to transaction data and analysis from J.D. Power’s Power Information Network® (PIN) and strategic partner LMC Automotive.

Sales of five hybrid/electric models—including the Toyota Prius hatchback hybrid—and two plug-in hybrid EVs (PHEVs)—including the Chevy Volt—more than doubled to 25,005 unit sales vs. 12,116 a year ago. Through the first 8 months of 2012, four brands offering six models—Toyota, Chevrolet, Nissan, Honda  and Mitsubishi—delivered 187,324 vehicles with alternative hybrid/electric, extended-range electric, and pure electric powertrains, which was a surge of 76% from the same period in 2011 (106,364 unit sales). Continue reading ›

Overall Sales Satisfaction Dips in Japan; Green Vehicle Customers Dissatisfied

Taku Kimoto

This year, fuel efficiency is the most frequently cited factor in choosing a new-vehicle, and is mentioned by nearly one-half (48%) of new-vehicle owners, in our 2012 Japan Sales Satisfaction Index (SSI) Study. That’s up slightly from 46%, just four years ago. In 2008, the factors most often cited in choosing . . . Continue Reading Overall Sales Satisfaction Dips in Japan; Green Vehicle Customers Dissatisfied

Power Up: Hybrid/Electric Vehicles in Southeast Asia

Southeast Asia’s hybrid/electric vehicle market may yet get another boost with the announcement from Honda that it will assemble its Jazz Hybrid in Thailand. Initially, Honda had contemplated assembling the Civic Hybrid in Thailand, but decided that it was not the right business proposition.

The popularity of the Jazz in Thailand means that a hybrid version will potentially do well. We expect the Jazz Hybrid to follow in the footsteps of Toyota’s locally assembled Camry Hybrid, which is slowly gaining sales. Planned for introduction in the first quarter of 2013, we estimate the hybrid version to improve Jazz annual sales by 25‐30%.

Although Honda has been an active participant in the global hybrid electric vehicle (HEV) market with the launch of the original Insight a decade ago, it has taken its time to bring HEVs to Southeast Asia. The Jazz Hybrid will be the third HEV to be built in Thailand, following the rollout of the Camry Hybrid in July 2009 and the Toyota Prius in December 2010. Continue reading ›

China’s Government Backs Off EVs, Looks to Hybrids

Tim Dunne

After a major push to jump start an electric vehicle (EV) industry in China, it appears that the Chinese government is backing off plans for the world’s largest EV industry, and is instead redirecting its focus on promoting hybrid powertrains.

If history is any indication—and automotive history is filled with a . . . Continue Reading China’s Government Backs Off EVs, Looks to Hybrids

Automakers Focus on Small, Greener and Electric during Detroit Previews

David Sargent

Think small, electric and more fuel-efficient. This could be a theme for more than 50 new products and concepts touted and displayed during this week’s press preview at the 2012 North American International Auto Show in Detroit, MI. The first auto show of the year, which was first held in 1907 at a local beer garden, is housed in Cobo Hall, where more than 1 million sq. ft. of space is devoted to exhibit stands that show off models for automakers around the world. David Sargent, vice president of global automotive at J.D. Power, attended the preview and offers his thoughts:

“The Detroit Auto Show was an upbeat affair this year, reflecting the turnaround that the industry has achieved since the dark days of 2008-2009. All three Detroit automakers are investing heavily in new products, and each had something new and exciting to show. Continue reading ›

New-Vehicle Owners in Japan Less Satisfied with Hybrid Quality

Atsushi Kawahashi

Owners of new hybrid vehicles in Japan indicate that their “green” vehicles meet expectations about fuel economy, but also say they have problems with the design of their hybrid vehicle controls and displays, according to our 2011 Japan Initial Quality Study (IQS), which is based on responses from more than 8,700 new-vehicle buyers during the first 2 to 9 months of vehicle ownership. The 2011 Japan IQS identifies problems in two distinct categories—quality of design, and defects and malfunctions—as measured by the number of problems reported per 100 vehicles (PP100).*

In this year’s study, 13% of new-vehicle owners in Japan say they own a hybrid. In addition, among owners of midsize models, nearly 50% own hybrids. As expected, almost 40% of hybrid-vehicle owners say they “strongly agree” that fuel economy is the most important factor when choosing a vehicle, which is twice as high as the percentage of non-hybrid-vehicle owners that puts fuel economy at the top of their list.

However, hybrid-vehicle owners also say they experience more problems than non-hybrid owners in two of the nine initial quality categories measured— audio/entertainment/navigation and features/controls/displays. Many of these hybrid owners reported problems related to design flaws in controls and displays and also said that features/controls/displays were not user friendly. Since a significant percentage of hybrid-vehicle owners are middle-aged and older, it will be critical for manufacturers to develop features, controls and displays that owners across a wide age range can operate without problems. Continue reading ›