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2017 U.S. Auto Avoider Study: Three of Four Car Buyers Avoid Considering SUVs Despite Record Retail Sales

2017 U.S. Auto Avoider Study: Three of Four Car Buyers Avoid Considering SUVs Despite Record Retail Sales

By Joseph Dobrian, January 12, 2017

Although 2016 was a record year for SUV sales, the recently published J.D. Power 2017 U.S. Auto Avoider StudySM shows that three of every four car buyers don’t even consider buying an SUV. According to the study, only 24% of car buyers considered buying an SUV in 2016—despite the fact that total retail sales of SUVs comprised 42% of the U.S. market. Only 5 years previously, SUVs made up just 34% of the market.

“Low fuel prices, favorable lease deals, and the availability of low-interest loans are attracting buyers to SUVs, which historically are more expensive than most car models,” said Dave Sargent, vice president of global automotive at J.D. Power. “However, since consumers, on average, pay a nine percent premium for an SUV compared with a comparably equipped sedan, many consumers still are not considering an SUV.”

The study shows that SUV buyers are more likely to purchase a vehicle for its cargo capacity, compared with car buyers (42% vs. 20%, respectively); 4WD or AWD capability (48% vs. 9%); and safety (45% vs. 38%). The J.D. Power 2016 U.S. Automotive Performance, Execution and Layout (APEAL) StudySM finds that SUV owners rate the “feeling of safety when driving the vehicle” higher than car owners.

Car buyers who did consider an SUV purchase but decided against it, tended to do so because they were seeking a lower price and better gas mileage. Buyers who shopped for cars before deciding on an SUV tended to reject the cars because they were too small, lacked the desired cargo capacity, and lacked 4WD/AWD capability.

The data indicate that promoting SUVs could be profitable for the automaker and the dealer. SUVs offer higher profit margins than other light vehicles; moreover, the Auto Avoider Study indicates that SUV buyers are less brand loyal than people who buy cars, pickup trucks, or minivans. Of all SUV buyers surveyed, 38% never owned that brand of vehicle before—a higher number than for car, pickup truck, and minivan buyers.

The largest-sales-volume segment in the industry, compact SUVs, are the most shopped and most considered vehicles on the market, and have one of the industry’s highest close rates. Of all new-vehicle buyers who shopped for a compact SUV, 61% bought one. The Honda CR-V, Toyota RAV4, and Ford Escape—all compact SUVs—are among the 10 most shopped/considered models by new-vehicle buyers.

Exterior and Interior Styling, Reliability Cited as Top Purchase Reasons
Reliability was cited as a top purchase reason by 59% of respondents in 2017, up from 55% last year, and the highest that reliability has been rated in 6 years. It is the third-most often stated purchase reason behind exterior styling (62%) and interior styling (61%).

“Even though manufacturers are producing vehicles with the highest quality levels ever achieved, vehicle reliability continues to be a top concern among buyers,” Sargent said.

For some brands, the perception of poor reliability continues to persist, even if that perception is outdated or mistaken. Kia, for instance, is one of the most avoided non-premium import brands due to concerns about reliability, yet it earned the highest ranking among all brands in the recent J.D. Power 2016 U.S. Initial Quality StudySM (IQS). Volkswagen was a make considered by only 4.5% of those surveyed, compared with 6.2% in last year’s study, possibly because of last year’s diesel-emission problems. Avoidance of Volkswagen due to the reputation of the manufacturer increases to 20% in 2017 from 9% in 2016.

Consumer Tips
Based on study findings, J.D. Power offers the following consumer tips:

  • Inform yourself not only of any problem an automaker has had recently with vehicle reliability or defects, but also with how that automaker dealt with the problem.
  • Compare the respective functions of a car, SUV, van, or pickup truck to determine which type of vehicle is best for your needs.
  • Consider whether the added initial cost and lower gas mileage of a larger vehicle, such as an SUV, might be compensated by its larger cargo and passenger capacity.
  • Vehicles’ reputations can change dramatically over a few years, so check your preconceived notions, or old stories that you’ve heard about various vehicles, against current reports.

About the Study
The 2017 U.S. Auto Avoider Study, now in its 14th year, examines the reasons consumers purchase, reject, and avoid models in the marketplace when shopping for a new vehicle. The 2017 study measures shopping behavior among new-vehicle buyers who purchased during 2016. The study is based on responses from more than 27,500 owners who registered a new vehicle in April and May 2016. The study was fielded between July and September 2016.

Additional Research:

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