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 ›

U.S. New-Vehicle Sales Recovery in Progress with Higher Transaction Prices

Tyson Jominy

Tyson Jominy

As 2012 wraps up, possibly the most important trend for the U.S. auto industry is that new-vehicle sales continue their recovery. Light-vehicle demand continues to increase. Retail sales in calendar 2012 will likely hit 11.74 million units, up from 10.3 million units in 2011. Growth is expected to continue into 2013—our retail sales forecast for next year is 12.25 million units. The forecast assumes that there is a deal reached in Washington, D.C. before the so-called “fiscal cliff” constellation of tax hikes and expenditure cuts are slated to happen at the start of 2013. Three other major trends that we see looking at our Power Information Network® (PIN) data include:

OEM Emphasis on Transaction-Price Growth

While industry sales volumes are increasing, they are still well below the levels recorded in 2004-2007, when annual retail sales were in the 13-14 million-unit range. The primary reason that the industry has not rebounded to these record sales levels is a change in focus among OEMs. Automakers now emphasize strong transaction prices in addition to sales volumes.

This change is evidenced by the record transaction prices that are being earned across the industry. For example, in early 2010, average retail transaction prices were slightly more than $27,000, while at the end of 2012, we have observed average transaction prices approaching $30,000. These strong transaction prices are helping to offset lower volumes, and are driving increased profitability for OEMs. Continue reading ›

May U.S. Retail Sales Volume was Second-Strongest This Year

May was another month of year-over-year sales growth in the U.S. auto market, even though the impact of Memorial Day weekend sales at the end of the month was weaker than anticipated, according to analysis by J.D. Power’s Power Information Network® (PIN) and LMC Automotive.*

May’s seasonally adjusted annual sales pace of 13.7 million units (SAAR) slipped below 14.0 million units, which has been a benchmark in each of the prior four months of 2012. Still, retail sales were the second-highest this year and totaled more than 1.07 million units, up 18.5% from a year ago on a selling-day-adjusted basis.** Fleet sales rose 6.9% to more than 261,200 units.

Most Multi-Franchise Automakers Post Retail Sales Gains

All multi-franchise automakers, except for the BMW Group, posted year-over-year retail and total U.S. sales gains in May. Toyota Group outperformed all other automakers with sales up 73% from a year ago, when inventories were hindered by production setbacks after the March 2011 Japan earthquake and tsunami disaster. Continue reading ›

Mini Car Competition Intensifies in India

The introduction of Hyundai’s all-new small car, the Eon, which was previously known by its code HA H800, will heat up the mini car battle in India. The Eon is expected to be a strong challenger to market leader Maruti Suzuki’s Alto. The Eon, an entry-level hatchback aimed at capturing first-time car buyers in India, was developed over 4 years at a cost of INR 9.56 billion (US $181 million).

In order to meet the requirements of car buyers in this growth market, Hyundai Motor’s research and development team in Hyderabad worked with Hyundai’s engineers in South Korea to design and develop the Eon exclusively for India. The result is a model that is stylishly designed and promises fuel economy of 21 kilometers per liter (equivalent to 13.05 miles per liter or about 79.38 miles per gallon)under test conditions. Powered by an 814 cc 3-cylinder gasoline engine, the Eon is also competitively priced from INR 285,309 (US $5,400) for the base model Eon D-Lite to INR 396,262 (US $7,500) for the top-end Sportz version, which has additional features such as keyless entry and a driver air bag. Continue reading ›

Smartphones, TV, Online Video Can Be Partners in Automotive Purchase Process

Smartphones are taking on a bigger role in both lead generation for dealers and in the entire auto purchase process for consumers, according to research and survey data presented by several digital-savvy speakers at the 2011 Automotive Internet Roundtable. Several speakers also indicated that reinforcing marketing messages through the use of several platforms—such as combining TV and the Internet—increases message retention significantly. Key points from some of the presentations at this year’s comprehensive 2-day event in Las Vegas, NV, which was attended by 1,250 industry members—the highest number of participants to attend any of the J.D. Power Automotive Internet conferences—will be featured in several posts today and during the next few weeks.

Improving Lead Response Quality and Time and Close Rates Benefits ROI

Sujata Sontakke

Sales lead volume has increased, and more customers are requesting quotes this year, according to research conducted by Urban Science. Jody Stidham, global practice director for the retail sales network consulting firm, based in Detroit, MI, told participants at the 2011 Automotive Internet Roundtable that there is a positive correlation between retail sales and lead volume. Stidham covered key points from research based on analysis of 4 million leads that considered the quality and quantity of leads, close rates, and dealer response to leads. Continue reading ›

Auto Industry Remains Stronger Despite External Shocks

John Humphrey

The economy is no longer the primary variable that could impact total US light-vehicle sales volume this year, as the auto industry is now grappling with gas prices* at their highest level in more than two years, as well as the potential for widespread shortages in vehicle availability due to the . . . Continue Reading Auto Industry Remains Stronger Despite External Shocks