What do buyers want most?

March 20, 2011

KPMG surveys auto execs on key buying factors

The key factors influencing consumer buying decisions are changing, according to KPMG’s 12th annual global survey of auto executives.

KPMG interviewed more than 200 global executives representing vehicle manufacturers and suppliers and found that fuel efficiency, safety innovation and styling will be the three most important product issues influencing consumer purchase decisions over the next five years. This represents a shift in perceived buying priorities from survey results conducted in previous years.

“Competition is driving the production of higher quality vehicles that incorporate new technologies for better performance and an enhanced driver experience. As a result, today’s consumer has come to expect a great deal from their vehicles,” says Gary Silberg, national automotive industry leader for KPMG LLP. “That innovation is benefiting the consumer across the entire vehicle category spectrum.”

When asked to rate the importance of product attributes to consumer purchase decisions over the next five years, “fuel efficiency” was most frequently cited in the 2011 survey (91 percent), followed by safety innovation (82 percent), vehicle styling (77 percent), and environmental friendliness (75 percent).

Safety innovation (71 percent in 2010) and vehicle styling (61 percent in 2010) were among the factors seeing the most significant increases in perceived importance compared to last year’s survey results. Consumer preferences for ergonomics and comfort, and telematics/personal assistance services also rose significantly.

Hot segments

In terms of which vehicle segments will be hot, those surveyed saw growth coming from new and emerging technologies. When asked which vehicle categories will see global sales increases over the next five years, hybrid vehicles (84 percent) were most frequently named by the respondents, followed by electric vehicles (77 percent), which was a new category option in the survey this year, cars (69 percent), other alternative fuel vehicles (63 percent), basic/introduction cars (60 percent), crossovers (56 percent), SUVs (51 percent), luxury vehicles (46 percent), small pick-up trucks (45 percent), minivans (41 percent), and large pick-up trucks (27 percent).

The categories seeing the most significant increases in the 2011 survey responses, compared with 2010, however, were SUVs, luxury vehicles, large pickup trucks, and crossovers.

“Executives believe that these categories are here to stay, that consumers are drawn to them, and that success lies in competitively producing the best vehicle within each category,” says Betsy Meter, national audit leader for KPMG’s automotive practice. “What we are also seeing is more optimism across the board for vehicle sales following the economic downturn.”

Conversely, responses for hybrid vehicles dropped in 2011, and basic/introduction cars fell more than 20 percentage points from last year. In fact, Hans Flick, national tax leader for KPMG’s automotive practice, noted that executives appear to indicate that the idea of entry-level cars may not have met expectations. “It may just be that even emerging market customers new to the car market look for all the features and comforts of a standard car,” said Flick.

In considering these results, it is important to note that they reflect the opinions of auto executives concerning what customers want, not the opinions of customers themselves.

KPMG has released an annual survey of automotive executives expressing their views on the state of the industry since 1999. For more information, visit: www.us.kpmg.com


About Todd Phillips

Todd Phillips is the editorial director of Universus Media Group Inc. and the editor of Canadian auto dealer magazine. Todd can be reached at tphillips@universusmedia.com.

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