Despite soaring popularity and dramatic sales forecasts for the next several years, hybrid market share is still expected to peak at 3 percent of the U.S. automotive market by 2011, according to a special report from J.D. Power & Associates.
In 2004, nearly 88,000 hybrid-electric vehicles were sold in the United States, comprising just 0.52 percent of the total U.S. light-vehicle market. The report anticipates hybrid sales will surge to more than 200,000 units this year, resulting in a market share increase to 1.19 percent. By 2006, when 17 hybrid-electric models will be available, sales are expected to climb to more than 260,000 units and market share to reach 1.53 percent. According to J.D. Power & Associates, that vehicle number will grow to 38 hybrid models (17 cars and 21 light trucks) by 2011, with sales reaching 535,000 units, or 3 percent of U.S. sales.
Toyota, which currently holds more than 60 percent of the hybrid market in the United States, is expected to maintain the greatest hybrid share through 2011, when it likely will hold 40 percent of the hybrid market. Honda currently holds 31 percent of the hybrid market share but is expected to see its share slip to 20 percent by 2011. Chevrolet is expected to be the largest domestic brand in the hybrid market, growing its market share to nearly 15 percent by the end of the decade.
“Despite the significant growth in the number of models and annual sales over the next five years, we anticipate hybrid market share to reach a plateau of approximately 3 percent near the end of the decade,” said Anthony Pratt, senior manager of global power train forecasting at J.D. Power-LMC.
Study Says Price is Biggest Draw to Local Dealerships
Scarborough Research, a research firm that identifies local, regional and national shopping trends for the American consumer, released an analysis of 19 million Potential New Auto Buyers located across the 75 local markets Scarborough surveys. According to Scarborough, 33% of Potential New Auto Buyers say price is the primary reason they chose the last auto dealership where they made a purchase. The other primary factors considered include: vehicle selection (22%), dealer reputation (20%), dealer location (19%), service (17%), financing (11 %), and warranty (10%).
Also from the study: Scarborough found that over half of all potential new auto buyers plan to purchase larger automobiles in the coming year: 29% indicated they plan to purchase a new SUV during the next 12 months, 19% plan to buy a pickup, and 12% plan to buy a van or minivan.
Car manufacturers are only as successful as their dealerships, and understanding the factors that bring consumers in the front door of a showroom is essential to building business on the local dealer level, said Alisa Joseph, vice president, advertiser marketing services, Scarborough Research. Manufacturers must ensure that the branding initiatives, dealership programs and other incentives they create on a corporate level drive dealer business on the local level, especially for new car purchases.
Auto-Insurance Rates Climb At Slowest Pace Since 2001
The Insurance Information Institute predicts auto-insurance rates will climb at their slowest rate since 2001, up only 1.5 percent from 2004, according to a Wall Street Journal report. The rise marks the sixth consecutive year of rate hikes; last year rates rose 2.8 percent from the previous year. Considering the increase, average auto-insurance policies in 2005 should cost roughly $870, just $13 more per vehicle from 2004, says the Institute. The Institute attributes the slowing trend of rate increase to a declining number of car accidents and thefts, along with safer vehicles, reports the Journal.
Accidents are expected to continue to decline in coming years, spurred by an aging population of nearly 80 million baby boomers “moving into their safest driving years,” said Robert Hartwig, the insurance instituteês chief economist.
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