drive market share gains automotive industry insights: q3 ......the forrester wave™: database...
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Drive Market Share Gains -Automotive Industry Insights: Q3, 2009
Jeffrey Anderson, Director of Consulting & Analytics
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Presentation Overview
Third Quarter 2009 Automotive Market Overview
• Vehicles in Operation (VIO)• Vehicle Registrations
• New and Used
• New Vehicle Market Share• Loyalty
• Corporate and Brand
• ‘Cash for Clunkers’
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Understanding the Automotive Customer Leveraging Experian’s “best in class” data assets
50,000 + adults surveyed annually 8,000+ brands in 450+ product categoriesMeasures television viewing, newspaper and magazine readership, internet usage, radio listening plus mobile700+ psychographic measuresEasily extrapolated to any target file
25 million Internet usersinteracting with one million Websites across 160+ industriesAverage of 60 billion emails sent on behalf of clients per year
Consumer2 million credit inquiries daily1.3 billion transaction updates/month99.9% system availability1.3 second response rate220 million credit active consumers50 million public records
Business22 million businesses
235 million consumers, 113 million households1,500+ data attributes per recordAttitudinal segments and touch-points3,200 public and proprietary sources110 million catalogbuyers148 million magazine subscribers
Approximately 600,000 knownfraud records186+ million cross-industry credit applications215+ million consumer200 +demographic and credit records
Experian has “the most well-regarded compiled consumer file on the market today” The Forrester Wave™: Database Marketing Service Providers, Q1 2006, Forrester Research Inc. January 10, 2006
NationalFraud
Database
600 million+ vehicles in U.S. (all 50 states & Wash. D.C.) and CanadaIncludes title, registration, mileage readings, key vehicle events5B+ vehicle history records, including 270M title brands and 92M accident related events
OnlineActivity
DatabasesCredit
Databases
ConsumerMarketing Databases
Simmons National
Consumer Study
NationalVehicle
Database
Integrated Information Assets
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Data foundation
VIO
Loyalty
Market Share
NationalVehicle
Database
Comprehensive coverage• Over 600 million total vehicles – U.S. and Canada
• 280 million total vehicles in operation• 825 million titles, 950 million registrations• Seven Terabytes, over 18 billion rows
Direct Sources• Vehicle title and registration data in 50 U.S. states and D.C.• Many other sources, including fleet, auction, maintenance, inspection, warranty, dealer, police
Variety of Metrics• Registration Trends• VIO Reporting• Loyalty Studies
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VEHICLESIN
OPERATION
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AutoCount Vehicles in Operation (VIO)
Experian Automotive’s AutoCount VIO is a compilation of all new and used vehicles registered on the road in the U.S.
Quick Facts…
• There are nearly 240 million light duty vehicles on the road
• Down over 481,000 units from last quarter, likely contributed to by cash for clunker program
• Ford is the most prevalent make, followed by Chevrolet and Toyota
• Hyundai has more than 6.1 million light duty vehicles (ranked seventh)
• Passenger cars have retaken top place from trucks (50.03% vs. 49.97%)
• Average age of all cars and light trucks in operation is 9.8 years
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0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
18,000,000
Current VIO – Year Model
Source: Experian Automotive as of September 30, 2009 (U.S. light duty vehicles only)
80 percent of vehicles are less than 14 years old
80%
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Current VIO – Vehicle Segment
Source: Experian Automotive as of September 30, 2009 (U.S. light duty vehicles only)
Hybrid vehicles represent 0.65 percent of current VIO
2% 4% 6% 8% 10% 12% 14%
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Current VIO – Percent Share
Source: Experian Automotive as of September 30, 2009 (U.S. light duty vehicles only)
GM
Ford
Toyota
Honda
Chrysler
HyundaiNissan
Other
As vehicles age, luxury and collector brands make up larger
share of VIO
VIO
Sha
re In
dex
Model Year Range
Vehicles in Operation: Share by Brand
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Total U.S. MidWest NorthEast South WestLight Truck 49.97% 49.6% 44.9% 51.9% 50.5%Passenger Car 50.03% 50.4% 55.1% 48.1% 49.5%
0%
10%
20%
30%
40%
50%
60%
Source: Experian Automotive as of September 30, 2009
Q3 2009 Vehicles in Operation (VIO):• Impact of Cash for Clunkers and preference for fuel
efficiency has helped drive cars back past trucks
Current VIO Trends – Vehicle Type
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Current VIO Trends – Drive Wheels by Region
Source: Experian Automotive as of September 30, 2009
4WD AWD FWD RWDWest 23.9% 25.3% 21.1% 23.8%South 28.6% 21.9% 37.1% 53.0%NorthEast 19.8% 29.7% 16.6% 7.7%MidWest 27.7% 23.1% 25.3% 15.5%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
• Market showing slight shift toward 4WD and AWD vehicles
• Front Wheel Drive still dominates total volume by 2 to 1
Q3 2009 Vehicles in Operation (VIO):
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0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
35,000,000
40,000,000
45,000,000
50,000,000
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
smar
tH
umm
erM
aser
ati
MIN
IK
iaH
yund
aiM
ayba
chA
ston
Mar
tinSc
ion
Ben
tley
Lam
borg
hini
Land
Rov
erLe
xus
Aud
iB
MW
Infin
itiM
erce
des-
Ben
zPo
rsch
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zuki
Acu
raTo
yota
Hon
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baru
Nis
san
Cad
illac
Volv
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itsub
ishi
Maz
daLi
ncol
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hrys
ler
Satu
rnVo
lksw
agen
Ferr
ari
Rol
ls R
oyce
Jeep
Che
vrol
etG
MC
Dod
geLo
tus
Pont
iac
Jagu
arFo
rdB
uick
Percent in Warranty Total VolumeSource: Experian Automotive as of September 30, 2009
Q3 2009 Vehicles in Operation (VIO):
An estimated 82.1% of all light vehicles do not have basic OEM warranties.
Perc
ent C
over
ed b
y O
EM W
arra
nty
Vehi
cles
in O
pera
tion
Current VIO Trends –Estimated Vehicles In Warranty
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VEHICLE REGISTRATION
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U.S. Automotive Market Overview
• Q3 2009 vs Q3 2008, new vehicle registrations have dropped only 270,000 units
• Compared to drops of more than 1.2 million units each in Quarters 1 and 2
14
Total Vehicle Registrations by Quarter
New Vehicle Registrations
Source: Experian Automotive
Used registrations are increasing in proportion to new registrations: 2.5x new in 2007, peaking at 4.2x in Q1 2009
2008 2009
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U.S. Market – New Vehicle Registrations
New Vehicle Registrations
Prior to Q3, New vehicle
registrations in past 3 quarters were down an average of 1.3 million units per
quarter
Source: Experian Automotive
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Impact of Cash for Clunkers Program
July and August 2009
Source: Experian Automotive
• New vehicle registrations resulting from Cash for Clunkers program represented one-third of all sales during July and August
• Even if Cash for Clunkers sales are not counted, Q3 would still show improvement vs. prior quarter over quarter comparisons
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Used Vehicle Registrations
U.S. Market – Used Vehicle Registrations
Used vehicle registrations are actually up in Q3
2009, but still down 5.6 percent
overall YTD
Source: Experian Automotive
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New Vehicle Market Overview
New Vehicle Registrations – Q3 2009 vs. Q3 2008
Source: Experian Automotive
• Overall, Q3 2009 down 269,939 units compared to Q3 2008
• However, Hyundai and Ford had gains in registrations (30% and 5% respectively)
• GM showed the largest unit drop (down 207,554 units), while GM and Chrysler shared largest percent drop (27% fewer sales), followed by Nissan (down 6%)
• Honda and Toyota were down slightly
Corporation
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Segment Registration Trends Q3 2009 vs. Q3 2008
CUV –Entry Level
Small Car
Econ.
Hybrid Car
CUV –Mid
Range
Small Car
Budget
Mid-Range
Car Std.
SUV –Entry Level
Van -Mini
SUV –Lower Mid-
RangePickup –Full Size
• CUV and Small car segments had greatest unit increases in Q3 2009 when compared to Q3 2008
• SUVs, Minivans and Full Size Pickups showed largest drops
Source: Experian Automotive
New
Reg
istra
tions
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M&M’s (Market Movers)
Ranked by % change
New
Reg
istra
tions
Source: Experian Automotive
Elantra up 22,353 units
Fusion up 16,569 units
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Market ChangersN
ew R
egis
tratio
ns
Source: Experian Automotive
Elantra and Corolla up
20,000+ unitsFusion and Escape
up a combined 30,000 units
Ranked by Unit Change
Ram and Tundra down 14,500 units
Silverado down 39,000 units
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NVE (New Vehicle Entries) Q3 Performance
• Continued strength of Camaro• Further expansion of CUV category• New entries represent Nearly 200,000
additional sales last 12 months
New Vehicle RegistrationsSource: Experian Automotive
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MARKET SHARE
OVERVIEW
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Who is up? • Hyundai 2.2% share• Ford 1.1% share• Honda 0.4% share
GM
Ford
Toyota
Honda
Chrysler
Hyundai
Nissan
Other
2009
Manufacturer Market Share Analysis
Who is down? • GM -2.8% share• Chrysler -1.8% share• Toyota -0.1% share
2009 YTD vs 2008 YTD Market Share
GM
Ford
Toyota
Honda
Chrysler
Hyundai
Nissan
Other
2008
Source: Experian Automotive
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Q3 2009 vs Q3 2008 Market Share
25
Source: Experian Automotive
• Subaru had highest proportional gain in market share, followed closely by Hyundai and Volkswagen
• Hyundai had highest point gain, followed by Ford and Toyota
• GM and Chrysler had large drops in share points (5% and 2% respectively)
Manufacturer Market Share Analysis
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Q3 2009 vs Q3 2008 Market Share
26
Source: Experian Automotive
• Small sedans key to driving share increases for Subaru, Hyundai and Ford
• Declines across key CUV, Minivan and Full Size Pickups segments impacting share for GM and Chrysler
Manufacturer Market Share Analysis
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CUSTOMERLOYALTY
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Loyalty Methodology
•Migration Measurement
•Multiple Levels
•Purchase Loyalty
Garage loyalty measures whether a new vehicle purchase matches a prior new vehicle owned, including vehicles currently in the garage or disposed up to 90 days prior to the new vehicle purchase.
Provides complete view of repurchase activity
Disposal loyalty measure whether a new vehicle purchase matches a vehicle disposed of +/- 90 days of the new vehicle purchase.
Essentially tracking vehicle replacement
Owned Vehicle:
Honda
Honda
Honda
Acura
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Q3 2009 Corporate Loyalty
29
• Toyota loyalty has dropped, but has gained top loyalty spot for first time
• Ford closing loyalty gap to GM• Hyundai continues to increase, closing in on Honda• Chrysler has dropped by 12 points from Q2 level
Market Overview - Loyalty
Corporate Loyalty by Month
• Ford had strong loyalty in August and September
• Chrysler had dramatic drop in loyalty in July and August
Source: Experian Automotive
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Brand Loyalty – Top Gainers for Q3 2009
Source: Experian Automotive
• Porsche had the greatest proportional jump in loyalty, increasing more than 30 percent
• Porsche also had the highest percentage point increase, jumping by more than 3.5 points
• Ford had the second greatest point gain: more than 2.2 percentage points
Q3 2009 vs Q3 2008 Brand Loyalty: ranked by % change
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Brand Loyalty by Model: Top 10
Q3 2009 Brand Loyalty
31
Source: Experian Automotive
• Toyota Venzaowners were most loyal, with more than 60% returning to Toyota brand
• Ford vehicles made up five of the top ten in brand loyalty
• Toyota Priuswas ranked 7th
in brand loyalty
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2007 – Who took from Whom?
Net Owner Migration
GM Ford
Toyota
ChryslerSource: Experian Automotive
Honda
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2007 – Who took from Whom?
64,000
Net UnitsFord (471,254)GM (330,313)Chrysler (225,213)Honda 325,555Toyota 701,225
Net Owner Migration
GM Ford
Toyota
Chrysler
Honda
Source: Experian Automotive
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2009 First Nine Months: Who’s taking from Whom?
Net Owner Migration
Chrysler
Toyota
GM Ford
Honda
Source: Experian Automotive
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2009 First Nine Months: Who’s taking from Whom?
31,100
Net UnitsGM (212,132)Chrysler (100,574)Ford (62,191)Honda 180,315Toyota 231,394
Net Owner Migration
Chrysler
Toyota
GM Ford
Honda
Source: Experian Automotive
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CASH FOR CLUNKERS
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Cash for Clunkers
Program OverviewTrade in old, low mpg vehicle for new, higher-mileage vehicleVouchers of $3,500 or $4,500 depending on vehicle type, mileage, etc. July 1 through August 24, 2009$3 billion in government fundsNetted 690,114 new vehicles sales
Study MethodologyMatch ‘clunker’ VINs to Experian NVDB: identify clunker participantsFind all those who disposed of same make/models as clunkers, but were notpart of clunker programTrack disposed vehicles and identify new vehicle purchasesCompare ‘Clunker’ participants vs ‘Non-Clunker’ vehicle disposers in terms of:
Brand loyalty, length of ownership, in-market frequencyBuyer characteristics such as age, income
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Cash for Clunkers: What Brands were Purchased?
38
Brands Purchased by Clunker Disposers
Source: Experian Automotive
Brands Disposed in Clunker Program
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Cash for Clunkers: Brand Loyalty
39
Brand Loyalty for Clunker vs Non-clunker
Source: Experian Automotive
• Overall loyalty to disposed brands was more than twice as high for those not part of cash for clunkers
• One explanation could be that it is due to condition of (and experience with) their vehicles versus those that were disposed in clunker program
Disposed Vehicle
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Cash for Clunkers: Brand Loyalty
40
Brand Loyalty for Clunker vs Non-clunker
Source: Experian Automotive
• Large differences in brand loyalty across board for clunker vs. non-clunker disposers
• Clunker participants disposing of a Toyota were most likely to repurchase same brand
• Just over three percent of Chrysler clunker trade-ins were replaced with another Chrysler vehicle
• Smallest clunker vs. non-clunker difference among Pontiac and Mazda ownersDisposed Brand
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Cash for Clunkers: Brand Loyalty
41
Brand Loyalty for Clunker vs Non-clunker
Source: Experian Automotive
• Among pickups, Toyota Tundra clunker disposers were most likely to return to brand, Dodge Ram least likely
• Toyota Previa and Honda Passport clunker disposers were more likely than non-clunker counterparts to return to brand
• Chrysler T&C clunker owners least likely to return to brand
• Toyota 4Runner very similar for clunker and non-clunker disposers
Disposed Vehicle
Pickups Minivans SUVs
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Cash for Clunkers: What Brands were Purchased?
42
Top Brands Purchased by Clunker Disposers
Source: Experian Automotive
Ford:
Toyota:
Dodge:
Chrysler: Honda:
Chevrolet:
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Cash for Clunkers: In-Market Impact
43
Number of Months since Last New Vehicle Purchase
Source: Experian Automotive
• Vehicles traded in for Clunker vouchers were on average nearly 3 years older than non-clunker vehicles disposed for new vehicle purchase
Average Age in Months of Disposed Vehicle
• Those participating in clunker program had been out of new vehicle market for 20 months longer on average when compared to non-clunker owners
Disposed Vehicle
Disposed Vehicle
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Cash for Clunkers: Incremental or Pull Ahead?
44
In-Market Model: Clunker vs Non-clunker
Source: Experian Automotive
• Clunker participants were more than 20 percent less likely to be ranked high in model that predicts likelihood of purchasing a new vehicle
In-Market Model Rank
Clu
nker
vs
Non
-Clu
nker
Inde
x
• Clunker participants were less likely to be in-market for a new vehicle when compared to non-clunkers
• Conversely, those taking part in clunker program were more likely to be ranked in lowest in-market ranking
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Cash for Clunkers: Who Participated?
45
Age of Clunker vs Non-clunker Disposers
Source: Experian Automotive
• Clunker participants were more likely to be 45 – 64 years of age when compared to non-clunker vehicle disposers
• Greatest difference in 45-54 age range, which represented one-third of clunker participants
Age of Vehicle Disposer
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Cash for Clunkers: Who Participated?
46
Income of Clunker vs Non-clunker Disposers
Source: Experian AutomotiveHousehold Income of Vehicle Disposer
• Clunker participants were more likely to have household income of $50,000 to $174,999 when compared to non-clunker vehicle disposers
• Largest differences in $75k-$99k, and $100-$124k
• Clunker owners appeared to be waiting for right time to enter new vehicle market
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Conclusions
New and used registrations seem to have hit bottom in early 2009, and appear to be on upswingGM and Chrysler will need quick success with current and upcoming products to stem declines in market shareNewer segments such as CUV (now at 60+ vehicles) continue to expand, but are pulling sales from existing SUV and minivan categories Finding right mix of vehicles for right-size segments will be challenge for manufacturers as fuel prices and politics intertwineNew vehicles with unique features and appeal can have immediate affect on sales, market share, and loyaltyBattle for market share continues to be interesting, as Ford and Hyundai successes continue, GM moves on with four brands, and smaller manufactures seize opportunityCash for Clunkers program accounted for a quarter of Q3 new vehicle registrations, but debate will likely continue on the overall incremental impact and ROI of this program
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Questions?
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