headlines 2008
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Headlines 2008
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Headlines 2009
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U.S. Automotive IndustryU.S. Automotive IndustryEconomic Impact Economic Impact
$576 billion in retail sales in 2008$576 billion in retail sales in 2008
More than 14% of total retail sales are More than 14% of total retail sales are generated at new-vehicle dealerships generated at new-vehicle dealerships
18,94318,943 new-vehicle dealerships in U.S. new-vehicle dealerships in U.S.
Over 1 million jobs at new-vehicle Over 1 million jobs at new-vehicle dealershipsdealerships
3
55
Number of Franchised Number of Franchised New-Car DealershipsNew-Car Dealerships
(Reduction from 50,000 in 1950)(Reduction from 50,000 in 1950)
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
YTD 2009
Source: NADA Industry Analysis
Recession1990-92 Recession
2007
Recession1980-82
Recession2001
4
66
Source: NADA Industry Analysis
8.53 8.27 8.14 8.70 8.85 8.42 8.06 7.61 7.50 7.67 7.80 7.60 6.79
6.57 6.86 7.408.20 8.50 8.70 8.74 9.00 9.30 9.23 8.70 8.50
6.36
0
5
10
15
20
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
Mill
ion
s o
f U
nit
s
Cars Lt. Trucks
13.2 Million Light Vehicles sold in 200813.2 Million Light Vehicles sold in 2008(Truck/SUV accounted for 48% of Sales)(Truck/SUV accounted for 48% of Sales)
Forecast for 2009 is 10.1-10.4 millionForecast for 2009 is 10.1-10.4 million
15.1 15.116.9
15.517.117.4 16.616.8 16.916.8 16.116.5
13.2
5
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CUV’s and Small Cars Sell Down CUV’s and Small Cars Sell Down during Clunker Programduring Clunker Program
-50% -45% -40% -35% -30% -25% -20% -15% -10% -5% 0%
Truck-based SUVs
Pickups
Large Cars
Midsize Cars
Minivans, Vans
Luxury Cars
Small Cars
Crossover Utility Vehicles YTD 2009
2008
Source: Ward’s Automotive6
88Source: R.L. Polk, Ward’s Automotive
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
2000
2001
2002
2003
2004
2005
2006
2007
2008
Un
its
GMNissanFordHondaToyota
Sales of HybridsSales of Hybridswere were 315,688 in 2008315,688 in 2008
7
Total DealershipTotal DealershipAdvertising ExpendituresAdvertising Expenditures
$0
$1
$2
$3
$4
$5
$6
$7
$8
$9
Bil
lio
ns o
f d
oll
ars
Source: NADA Industry Analysis8
Dealership Advertising Dealership Advertising Expenditures Expenditures
Per New Light Vehicle SoldPer New Light Vehicle Sold
$0
$100
$200
$300
$400
$500
$600
$700
Do
lla
rs
Source: NADA Industry Analysis9
1111
Television 16.6%
Direct mail 10.2%
Newspaper 52%
Newspaper 23.2%
Other 15.1%Other 16.6%
1998 2008
Advertising Advertising Expenditures at New Car Expenditures at New Car
Franchised DealersFranchised Dealers
Radio 15.3%
Television 18.8%
Radio 15.2%
Internet 17.2%
Source: NADA Industry Analysis10
1212
0123456789
101112131415161718
Perc
enta
ge
Internet Advertising as a Internet Advertising as a percentage of Total percentage of Total
Advertising ExpendituresAdvertising Expenditures
Source: NADA Industry Analysis11
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National “Buy Now” National “Buy Now” PSA campaignPSA campaign
Most extensive public advertising Most extensive public advertising campaign in NADA historycampaign in NADA history
Extraordinary support from mediaExtraordinary support from media Ads are running:Ads are running:
• In nearly 350 marketsIn nearly 350 markets• On 343 TV stations or cable systemsOn 343 TV stations or cable systems• On 189 radio stations or groupsOn 189 radio stations or groups• In 172 newspapers or publishing groupsIn 172 newspapers or publishing groups
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U.S. Auto Industry 2009U.S. Auto Industry 2009
Industry has declined to 10.1-10.4 Industry has declined to 10.1-10.4 million units, but outlook is better for million units, but outlook is better for 2010: 12 million units2010: 12 million units
Dealer network continues to Dealer network continues to downsize as GM, Chrysler restructuredownsize as GM, Chrysler restructure
““Cash for clunkers:” 700,000 vehicles Cash for clunkers:” 700,000 vehicles soldsold
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Advertising Outlook, Advertising Outlook, 2009 and Beyond2009 and Beyond
Expect advertising spending to increase with new-Expect advertising spending to increase with new-vehicle sales in 2010. vehicle sales in 2010.
Expect even higher rates of ad spending by 2012, Expect even higher rates of ad spending by 2012, lifted by new-vehicle sales reaching 15 million units lifted by new-vehicle sales reaching 15 million units for total advertising spending of well over $7 billion.for total advertising spending of well over $7 billion.
Larger dealerships use more TV, and industry Larger dealerships use more TV, and industry consolidation will drive relatively higher TV use.consolidation will drive relatively higher TV use.
2009 advertising spending has dropped 19.5 2009 advertising spending has dropped 19.5 percent as of mid-year (June), but ad spending percent as of mid-year (June), but ad spending during Clunkers period will reduce this rate of during Clunkers period will reduce this rate of decline slightly.decline slightly.
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““Cash for Clunkers”Cash for Clunkers”Top Sold:Top Sold:
1.1. Toyota CorollaToyota Corolla2.2. Honda CivicHonda Civic3.3. Toyota CamryToyota Camry4.4. Ford FocusFord Focus5.5. Hyundai ElantraHyundai Elantra
Top Traded:Top Traded:1.1. Ford Explorer 4WDFord Explorer 4WD2.2. Ford F-150 PickupFord F-150 Pickup3.3. Jeep Grand CherokeeJeep Grand Cherokee4.4. Ford Explorer 2WDFord Explorer 2WD5.5. Dodge CaravanDodge Caravan
Source: Department of Transportation15
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Clunkers Impact in August: Clunkers Impact in August: August vs. Year-to-Date ShareAugust vs. Year-to-Date Share
Share of U.S. New Light Vehicle Market Share of U.S. New Light Vehicle Market
0% 5% 10% 15% 20% 25%
Volkswagen
Hyundai
Chrysler
Nissan
Honda
Ford Motor
Toyota
General Motors
Aug-09
YTD 2009
Source: Ward’s Automotive16
181817
1919
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