Category: AutomotiveUnited States

Customers Appreciate Aftermarket Service Providers for Their Convenience, JD Power Finds

2024-04-26

jillian.breska

TROY, Mich.: 30 April 2024 — After experiencing year-over-year slumps last year, overall satisfaction rebounds across the three segments examined in the JD Power 2024 U.S. Aftermarket Service Index (ASI) Study,^SM  released today. Full-service maintenance and repair sees the greatest improvement (+12 points on a 1,000-point scale), followed by tire replacement (+5) and quick oil change (+4). Boosts in all three segments are largely driven by improved service advisor performance and courtesy, along with enhancements in service facilities and time to complete service.

Amid record-high appointment wait times at franchised dealerships,¹ customers are finding it easier to do business with aftermarket service providers due to no-appointment drive-in service or a small number of days wait for an appointment.

“This is a key opportunity for aftermarket providers to not only compete with franchised dealers on price, but also to add customer value with a quicker and easier service experience,” said Leonard Martin, director of automotive retail at JD Power. “Aftermarket service providers should continue to focus on service advisor performance, courtesy and creating a welcoming environment for customers who wait at the facility. In addition, technology utilization can inspire transparency, trust and strong advocacy for the service provider.”

The study, now in its fifth year, measures customer satisfaction with aftermarket service facilities, providing a numerical index ranking of the highest-performing facilities in the U.S. aftermarket. Performance in three segments—full-service maintenance and repair; quick oil change; and tire replacement—is based on the combined scores for seven factors that comprise the vehicle owner service experience. These factors are (in alphabetical order): ease of scheduling/getting vehicle in for service; fairness of charges; service advisor courtesy; service advisor performance; service facility; time to complete service; and quality of work.

Following are key findings of the 2024 study:

• Younger customers are harder to please: Gen Z² customers have lower satisfaction than do Gen Y customers with tire replacement (-15 points) and full-service maintenance and repair providers (-6). Service advisors are the key to turning this around. “Younger customers are less likely to have a service provider with whom they are familiar, and they may need more guidance from advisors in order to build a trusting relationship,” Martin said. “This is an opportunity for aftermarket providers to create new long-time loyal customers when they have been provided with satisfying experiences.”
• Photo/video documentation for recommended repairs: Multi-point inspections (MPI) are routine, but fewer than one-fourth (23%) of customers receive any kind of accompanying photo or video documentation. While doing so is more time-consuming for service staff, providing photo/video evidence of recommended repairs has a significant payoff, especially for tire replacement providers. Of the customers who receive an MPI with photo/video, 51% have the recommended work done. Without photo/video, only 24% of customers who receive an MPI have the work done.
• Franchised dealerships more trustworthy in some areas: Dealerships have a higher level of customer trust than do aftermarket service facilities. For example, ratings by dealership customers for the use of technology to make service more efficient average 6.09 (on a 7-point scale), compared with ratings by tire replacement customers, which average 5.90. Ratings by dealership customers for the ability to perform complex repairs on the vehicle average 6.12, while the average by customers of full-service maintenance and repair providers is 5.83. Across each segment in the study, aftermarket service customers continue to find their provider easier to do business with (average of 6.26), while franchise dealer customers rate their service provider an average of 6.09.

Study Rankings

Christian Brothers Automotive Corp. ranks highest in satisfaction for full-service maintenance and repair for a fifth consecutive year, with a score of 825. Meineke Car Care Centers (810) and Midas (810) each rank second in a tie.

Express Oil Change and Tire Engineers ranks highest in satisfaction for quick oil change for a second consecutive year, with a score of 841. Take 5 (818) ranks second and Valvoline Instant Oil Change (815) ranks third.

Jiffy Lube ranks highest in satisfaction for tire replacement for the first time with a score of 842. Meineke Car Care Centers (834) ranks second and Midas (829) ranks third.

The 2024 U.S. Aftermarket Service Index (ASI) Study is based on responses from 10,264 vehicle owners. Survey data collection was conducted online from January through March 2024. Survey respondents were initially selected from online consumer panels. New for the 2024 study, respondents who indicated in previous JD Power Customer Service Index (CSI) studies that they had taken their vehicle to an aftermarket provider were mailed a paper invitation letter asking for participation in the online ASI survey. Respondents were screened for having had aftermarket service performed in the past 12 months.

For more information about the U.S. Aftermarket Service Index (ASI) Study, visit https://www.jdpower.com/business/automotive/us-aftermarket-service-index-asi-study.

About JD Power
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

¹JD Power 2024 U.S. Customer Service Index (CSI) Study^SM
2JD Power defines generational groups as Pre-Boomers (born before 1946); Boomers (1946-1964); Gen X (1965-1976); Gen Y (1977-1994); and Gen Z (1995-2006). Millennials (1982-1994) are a subset of Gen Y.

 

EV Purchase Consideration Ebbs While Charging Concerns Continue to Grow, JD Power Finds

2024-05-13

jillian.breska

TROY, Mich.: 16 May 2024 — Consumer demand for electric vehicles (EVs) has cooled as the industry grapples with persistent growing pains, according to the JD Power 2024 U.S. Electric Vehicle Consideration (EVC) Study,^SM released today. For the first time since the study’s inception in 2021, new-vehicle buyer consideration has dropped from the previous year. This year’s study reveals that 24% of shoppers say they are “very likely” to consider purchasing an EV, down from 26% a year ago, while the percentage of shoppers who say they are “overall likely” to consider purchasing an EV decreases to 58% from 61% in 2023.

“As the industry inches toward mass consumer adoption, the main roadblocks to getting consumers behind the wheel of an EV are the continued shortage of affordable vehicles, charging concerns and a lack of knowledge regarding the EV ownership proposition, including incentives,” said Stewart Stropp, executive director of EV intelligence at JD Power. “As understanding of EV incentives rises, so does the likelihood of consideration. However, approximately 40% of shoppers say they do not have a solid understanding of such incentives. Prioritizing initiatives and efforts to educate consumers about the EV proposition—including available incentives and how they work—is vital to accelerating market growth.”

Other factors contributing to waning EV demand include lower year-over-year fuel prices; stubborn inflation and high interest rates; and underwhelming growth in model availability. “In previous years, the number of viable EVs that met shoppers’ needs increased substantially year over year,” Stropp said. “This year, it’s been more incremental. Several automakers have deferred EV launch and production plans and have shifted more focus toward hybrids and plug-in hybrids, so we’re seeing a lot of shoppers who still haven’t found an EV that checks all the boxes.”

Following are some key findings of the 2024 study:

• “Very likely” EV consideration drops among Gen Z[1] and Gen Y shoppers: The lack of affordable EV models is affecting the two youngest buyer cohorts, Gen Z and Gen Y, with “very likely” consideration down 2 and 5 percentage points year over year, respectively. Still, 24% of Gen Z and 32% of Gen Y shoppers say they are “very likely” to consider an EV, the two highest ratios among all the generational cohorts.
• Top five reasons for EV rejection mostly related to charging: Among shoppers who say they are “somewhat unlikely” or “very unlikely” to consider an EV, 52% cite a lack of charging station availability as a reason for rejection—the highest proportion in the study. This figure has increased 3 percentage points year over year, a sign that concerns about public charging infrastructure are only getting worse. Other reasons for rejection include purchase price; limited driving distance per charge; time required to charge; and inability to charge at home or work.
• Drivers with longer commutes less inclined to consider EVs: Previous-year studies noted that owners who drove more miles each day were more likely to consider an EV. Now, with fuel prices coming down and charging anxiety on the rise, that trend has reversed. Among shoppers whose daily commute is 46-60 minutes each way, only 24% say they are “very likely” to consider an EV—down 13 percentage points from 2023.
• Role of pending vehicle influences consideration: Among shoppers who are looking to add another vehicle to their household, 68% say they are “overall likely” to consider an EV. Conversely, among those who will be relying solely on one vehicle for transportation, only 47% say they are “overall likely” to consider an EV. Without a second vehicle, shoppers tend to be more critical of the logistics related to EV ownership.

The U.S. Electric Vehicle Consideration (EVC) Study is an industry benchmark focusing on gauging fully electric or battery electric vehicle shopper consideration, simply referred to as EVs in the study. Study content includes overall EV consideration by geography; demographics; vehicle experience and use; lifestyle; and psychographics. It also includes model-level consideration details such as “why buy” findings and analysis of reasons for EV rejection. This year’s study measures responses from 8,179 consumers and was fielded from January through April 2024.

For more information about the U.S. Electric Vehicle Consideration (EVC) Study, visit https://www.jdpower.com/business/automotive/electric-vehicle-consideration-study.

About JD Power
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

¹JD Power defines generational groups as Pre-Boomers (born before 1946); Boomers (1946-1964); Gen X (1965-1976); Gen Y (1977-1994); and Gen Z (1995-2006). Millennials (1982-1994) are a subset of Gen Y.

 

May Sales Pace Forecast to Exceed 16 Million Units for First Time This Year

2024-05-22

jillian.breska

The Total Sales Forecast

Total new-vehicle sales for May 2024, including retail and non-retail transactions, are projected to reach 1,446,800 units, a 2.9% increase from May 2023 on a selling day adjusted basis, according to a joint forecast from JD Power and GlobalData. May 2024 has 26 selling days, one more than May 2023. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 7% from a year ago.

The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 16.1 million units, up 0.5 million units from May 2023.

The Retail Sales Forecast

New-vehicle retail sales for May 2024 are expected to increase when compared with May 2023. Retail sales of new vehicles are expected to reach 1,187,000 units, a 4.4% increase on a selling day adjusted basis. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 8.6% from 2023.

The Takeaways

Thomas King, president of the data and analytics division at JD Power:
“Expected new-vehicle sales results for May represent a mixed bag of outcomes. On the positive side, the total sales pace will exceed 16 million units for the first time this year. Also, discounts are similar to last month, despite May being a month in which discounts traditionally increase to take advantage of elevated shopping activity during the Memorial Day weekend. This is good news for manufacturer and retailer profitability. However, the industry continues to produce more vehicles than are being sold, leading to rising inventories and increasing the likelihood of elevated discounts as the year progresses.”

Retail inventory is projected to finish around 1.8 million units, a 0.6% increase from April 2024 and a 52.7% increase from May 2023. Fleet mix is projected at 18%, down 1.2 percentage points from May 2023 and down 3.4% on a selling-day adjusted volume basis.

“The average new-vehicle retail transaction price is declining compared with a year ago as manufacturer incentives rise, retailer profit margins fall and availability of lower-priced vehicles increases. Transaction prices are trending towards $45,033—down $1,045 or 2.3%—from May 2023. The combination of slightly higher retail sales but lower transaction prices means that shoppers are on track to spend nearly $50.9 billion on new vehicles this month—6.8% higher than May 2023 and the second highest May on record.

“Total retailer profit per unit—which includes vehicles gross plus finance and insurance income—is expected to be $2,471, down 31.5% from May 2023. Rising inventory is the primary factor behind the profit decline and fewer vehicles are selling above the manufacturer’s suggested retail price (MSRP). Thus far in May, only 14.9% of new vehicles have been sold above MSRP, which is down from 29.2% in May 2023.”

Total aggregate retailer profit from new-vehicle sales for this month is projected to be $2.8 billion, down 21.5% from May 2023.

“Rising inventory means fewer vehicles are being pre-sold by retailers, with more shoppers able to buy directly off dealer lots. This month, JD Power forecasts that 33.3% of vehicles will sell within 10 days of arriving at the dealership, down from a peak of 58% in March 2022. The average time a new vehicle remains in the dealer’s possession before sale is expected to be 40 days, up from 29 days a year ago.

“Manufacturer discounts are expected to be similar to April (up $33 per unit) but have materially increased from a year ago. The average incentive spend per vehicle has grown 48.1% from May 2023 and is currently on track to reach $2,640. Expressed as a percentage of MSRP, incentive spending is currently at 5.3%, an increase of 1.7 percentage points from a year ago.  Increased spending of current model year is nearly offset by lower volumes of prior model year vehicles with higher spending.

“One of the drivers of higher incentive spending from a year ago is the increased availability of lease deals, and leasing is growing accordingly. This month, leasing is expected to account for 23.9% of retail sales, up 3.3 percentage points from 20.6% in May 2023.

“After rising consistently during the past few years, average monthly loan payments are stabilizing. The average monthly finance payment this month is on pace to be $727, down $3 from May 2023. The average interest rate for new-vehicle loans is expected to be 7.1%, an increase of 17 basis points from a year ago.

“So far in May, average used-vehicle retail prices are $28,470, reflecting a 5.4%–or $1,614—decrease from a year ago. The decline in used-vehicle values is translating to lower trade-in equity for owners, now trending towards $7,866, which is down $1,438 from a year ago.”

Sales & SAAR Comparison

U.S. New Vehicle	May 20241, 2	April 2024	May 2023
Retail Sales	1,187,037 units (4.4% higher than May 2023)2	1,080,865 units	1,093,152 units
Total Sales	1,446,760 units (2.9% higher than May 2023)2	1,326,978 units	1,351,664 units
Retail SAAR	13.3 million units	13.3 million units	12.5 million units
Total SAAR	16.1 million units	15.9 million units	15.6 million units

¹ Figures cited for May 2024 are forecasted based on the first 16 selling days of the month.
² May 2024 has 26 selling days, one more than May 2023.

The Details

• The average new-vehicle retail transaction price in May is expected to reach $45,033, down $1,045 from May 2023. The previous high for any month—$47,329—was set in December 2022.
• Average incentive spending per unit in May is expected to reach $2,640, up from $1,782 in May 2023. Spending as a percentage of the average MSRP is expected to increase to 5.3%, up 1.7 percentage points from May 2023.
• Average incentive spending per unit on trucks/SUVs in May is expected to be $2,710, up $877 from a year ago, while the average spending on cars is expected to be $2,341, up $767 from a year ago.
• Retail buyers are on pace to spend $50.9 billion on new vehicles, up $3.3 billion from May 2023.
• Trucks/SUVs are on pace to account for 80.6% of new-vehicle retail sales in May.
• Fleet sales are expected to total 259,723 units in May, down 3.4% from May 2023 on a selling day adjusted basis. Fleet volume is expected to account for 18% of total light-vehicle sales, down 1.2 percentage points from a year ago.
• Average interest rates for new-vehicle loans are expected to increase to 7.1%, 17 basis points higher than a year ago.

EV Outlook

Elizabeth Krear, vice president, electric vehicle practice at JD Power:
“We’re seeing a ‘low tide moment’ for EVs right now, but it’s unclear how long it will last. EV market share peaked at 8.8% in April, with May expected to be down 0.4 percentage points. Results from the JD Power 2024 Electric Vehicle Consideration Study show that, for the first time since the study’s inception in 2021, EV shopper consideration has dropped from the previous year. This year, 24% of shoppers say they are ‘very likely’ to consider purchasing an EV, which is down from 26% a year ago. Shoppers who are rejecting EVs point to lack of charging station availability, purchase price, limited driving distance per charge, time required to charge and inability to charge at home or work.

“The decline in shopping interest for EVs comes as the industry has reached an all-time high in EV availability. EV availability is at 54.3—the highest it’s ever been on a 100-point scale—as it moves toward parity with gas-powered vehicles. EV adoption within the JD Power EV Index fell to 16.2 in April, hitting its lowest point since August 2021. EV retail share, while having some bright spots when it comes to certain models, is not growing at the same pace as EV availability. This is bringing aggressive conquest sales programs to the EV segment, so we’ll see if shoppers find them attractive enough.”

Global Sales Outlook

Jeff Schuster, vice president of research, automotive at GlobalData:
“The global light-vehicle selling rate accelerated in April to 85.9 million units from 84.3 million units in March. After a slower start to 2024, the April year-to-date selling rate has risen to 83.9 million units and is expected to continue to climb as the year progresses and the typical distortions in the first quarter are averaged out.

“From a volume perspective, April increased 3% year over year to 6.8 million units, slightly weaker than initial expectations for the month, but still a solid performance at the topline. Below the topline, the results were mixed, with Europe outperforming all major markets, increasing 14% year over year. China’s domestic sales increased just 3% as consumers face mounting challenges that the price cuts did not override. North America, Korea and Japan all contracted in April, due in part to base effect and fewer selling days. Japan’s selling rate recovered as previously suspended production at Toyota and Daihatsu restarted.

“The global selling rate in May is expected to increase significantly to 89 million units on volume growth of 2%. The wildcard this month is expected to be China, which is currently projected to contract 0.4%. If the Chinese market can rebound off recent weakness, global growth will be driven higher. Japan is expected to post a near double-digit increase in May, fueled by stronger mini-vehicle production.

“Given the higher volatility and inconsistent performance across markets, the outlook for 2024 is virtually unchanged at 89.1 million units, a 3% increase from 2023. There is some downward pressure from markets across Asia that could pull the global market down slightly as we progress through 2024. Pricing trends, geopolitical risk and the overall performance of economies around the world continue to be key drivers in the near-term auto market.”

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info
About GlobalData https://www.globaldata.com/

 

December to Cap Off Another Profitable Year for Dealers as Consumers Spend Record $578 Billion on New Vehicles in 2023

2023-12-21

jillian.breska

The Total Sales Forecast

Total new-vehicle sales for December 2023, including retail and non-retail transactions, are projected to reach 1,396,700 units, a 13.2% increase from December 2022, according to a joint forecast from JD Power and GlobalData. December 2023 has 26 selling days, one fewer than December 2022. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 9.0% from a year ago.

The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 15.4 million units, up 1.7 million units from December 2022. New-vehicle total sales in Q4 2023 are projected to reach 3,826,000 units, a 9.8% increase from Q4 2022 when adjusted for selling days. New-vehicle total sales for 2023 are projected to reach 15,466,000 units, a 13.2% increase from 2022 when adjusted for selling days.

The Retail Sales Forecast

New-vehicle retail sales for December 2023 are expected to increase when compared with December 2022. Retail sales of new vehicles this month are expected to reach 1,169,000 units, a 13.1% incraese from, December 2022. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 8.9% from 2022. New-vehicle retail sales in Q4 2023 are projected to reach 3,186,700 units, a 9.8% increase from Q4 2022 when adjusted for selling days. New-vehicle retail sales for 2023 are projected to reach 12,645,600 units, an 8.4% increase from 2022 when adjusted for selling days.

The Takeaways

Thomas King, president of the data and analytics division at JD Power:
“December results cap off the year with a strong performance, illustrated by double-digit year-over-year sales growth and the second-highest consumer expenditure on new vehicles ever recorded for the month. Total sales of just under 15.5 million for 2023, represent a significant increase of 12.8% from 2022, when just 13.7 million vehicles were sold. What’s even more noteworthy is that consumer expenditure on new vehicles in 2023 set a record of $578 billion. This is the third consecutive year in which U.S. consumers spent more than half a trillion dollars buying new vehicles.

Sales growth for December is being enabled by improving vehicle availability and affordability. Retail inventory levels in December are expected to finish around 1.7 million units, a 7.6% increase from last month and 55.1% increase compared with December 2022, but still nearly 40% below pre-pandemic levels.

“As inventory improves, the average new-vehicle retail transaction price is declining. Transaction prices in December are trending towards $46,055, down $1,274—or 2.7%—from December 2022. However, even with the decline in average transaction prices, consumers are on track to spend nearly $50.4 billion on new vehicles this month—the second highest on record for the month of December and 5.1% higher than December 2022.”

Sales to fleet customers are also rising as vehicle availability improves. Fleet sales are projected to increase 13.6% from December 2022, or 9.4% on a non-selling day adjusted basis.

“The increase in new-vehicle supply and higher interest rates are resulting in falling per unit dealer profits, but those profits continue to exceed pre-pandemic levels. The total retailer profit per unit—which includes vehicles gross plus finance and insurance income—is expected to be $2,729 in December. While this is 32.5% lower than a year ago, it is still more than double the amount in December 2019. The primary factor behind the profit decline is the reduced number of vehicles selling above the manufacturer’s suggested retail price (MSRP). This month, only 18.9% of new vehicles are projected to be sold above MSRP, which is down from 32.5% in December 2022.”

Total aggregate retailer profit from new-vehicle sales for this month is projected to be $3 billion, down 27.1% from December 2022, but up 103% from December 2019. Total aggregated retailer profit for 2023 is projected to be $42 billion, down 23% from 2022, but still more than double the pre-pandemic level.

“While retailers continue to pre-sell vehicles, rising inventory is enabling more shoppers to buy directly off dealer lots. In December, 35.5% of vehicles are projected to be sold within 10 days of their arrival at the dealership, which is down from the peak of 57% in March 2022. The average time that a new vehicle spends in the dealer’s possession before being sold is expected to be 38 days, up 13 days from a year ago, but still less than half the pre-pandemic average of 70 days.

“Manufacturer discounts in December are expected to be up $145 from November and have materially increased from a year ago when incentives were at record lows. The average incentive spend per vehicle has grown 90.7% from December 2022 and is currently on track to reach $2,458. Expressed as a percentage of MSRP, incentive spending is currently at 4.9%, an increase of 2.3 percentage points from December 2022. This month, leasing is expected to account for 21.2% of retail sales, up significantly from 17% in December 2022, but still well below December 2019 when leased vehicles made up 30% of all new-vehicle retail sales.

“Despite falling transaction prices, higher interest rates and reduced trade equity are contributing to the escalation of monthly loan installments. The average monthly finance payment in December is on pace to be $739, up $9 from December 2022. That translates to a 1.1% increase in monthly payments from a year ago. The average interest rate for new-vehicle loans is expected to be 6.9%, an increase of 46 basis points from a year ago. 

“Average used-vehicle prices are forecasted to be $29,413 in December, reflecting a 2.6% or $786 decrease to December 2022. However, they remain 28.7% higher than the pre-pandemic level. The decline in used-vehicle values is translating to lower trade-in equity for consumers. The average trade-in equity is trending towards $8,521, down $780 from a year ago. It’s important to note that despite this decrease, trade-in equity remains nearly double the amount prior to the pandemic.

“In 2024, retail inventory is expected to keep rising and that increase in supply will lead to moderation in pricing. Additionally, anticipated interest rate cuts will also help affordability. This trend will drive an increase in sales, but at the expense of OEM and retailer per-unit profitability. This tradeoff between increased volume and lower per-unit profit means that total profitability for OEMs and retailers will remain very strong relative to historical levels.”

Sales & SAAR Comparison

U.S. New Vehicle	December 20231, 2	November 2023	December 2022
Retail Sales	1,169,037 units (13.1% higher than December 2022)2	1,015,944 units	1,073,330 units
Total Sales	1,396,696 units (13.2% higher than December 2022)2	1,225,500 units	1,281,492 units
Retail SAAR	13.1 million units	12.3 million units	11.5 million units
Total SAAR	15.4 million units	15.4 million units	13.7 million units

¹ Figures cited for December 2023 are forecasted based on the first 14 selling days of the month.
² December 2023 has 26 selling days, one fewer than December 2022.

The Details

• The average new-vehicle retail transaction price in December is expected to reach $46,055, down $1,274 from December 2022. The previous high for any month—$47,329—was set in December 2022.
• Average incentive spending per unit in December is expected to reach $2,458, up from $1,289 in December 2022. Spending as a percentage of the average MSRP is expected to increase to 4.9%, up 2.3 percentage points from December 2022.
• Average incentive spending per unit on trucks/SUVs in December is expected to be $2,645, up $1,346 from a year ago, while the average spending on cars is expected to be $1,880, up $634 from a year ago.
• Retail buyers are on pace to spend $50.4 billion on new vehicles, up $2.4 billion from December 2022.
• Trucks/SUVs are on pace to account for 81% of new-vehicle retail sales in December.
• Fleet sales are expected to total 227,660 units in December, up 13.6% from December 2022 on a selling day adjusted basis. Fleet volume is expected to account for 16.3% of total light-vehicle sales, unchanged from a year ago.
• Average interest rates for new-vehicle loans are expected to increase to 6.9%, 46 basis points higher than a year ago.

EV Outlook

Elizabeth Krear, vice president, electric vehicle practice at JD Power:
“With EVs accounting for 9.8% of retail sales thus far in December—up more than a percentage point from 8.5% a year ago—it’s noteworthy that the JD Power EV Index factors of consumer interest, availability and affordability are all hitting the highest levels of the year. Nearly one-third (29%) of consumers now say they are ‘very likely’ to consider an EV for their next vehicle, which is the highest level in 16 months. Meanwhile, overall EV affordability has reached parity with gas-powered vehicles, driven largely by state and federal tax incentives and significant price reductions in Tesla’s high-volume Model Y and Model 3. Vehicle availability also has increased significantly—51 models now vs. 43 models a year ago—and many are being offered in lower-priced trim levels.

“EV share of inventory has grown in the past year from 1% to 6% but it’s important to keep this in context. A year ago, new-vehicle shoppers struggled to find many EVs on dealer lots and were paying a premium. Higher inventory levels are helping EV adoption.

“However, the first quarter of 2024 will be one of the most dynamic quarters the EV market has ever seen. Automakers and consumers will grapple with significant new provisions that go into effect from the Inflation Reduction Act, putting pressure on EV affordability. On the product side, Tesla is refreshing the high selling Model 3, but Chevrolet starts 2024 absent its cheapest EVs—the recently discontinued Bolt and Bolt EUV—while it launches more expensive midsize SUV and full-size truck models.

“Also, in January, several new variables go into effect from the Inflation Reduction Act that will affect EV prices. First, consumers will now be able to claim purchase credit (Section 30D) for their qualifying vehicle at point of sale, which can be used as a down payment. Previously, buyers had to wait until filing their taxes the following spring. On the challenging side, more stringent IRA requirements about critical mineral components and sourcing mean that many top-selling models will lose IRA credit on purchase transactions. These models include top selling Tesla Model Y and Model 3, plus Ford Mustang Mach-e and others. Automakers will be forced to react with profit-hurting incentives or face a potentially slower sales pace. Combined with likely pull-ahead demand into Q4 2023, Q1 2024 will be worth watching.”

Global Sales Outlook

Jeff Schuster, group head and executive vice president, automotive at GlobalData:
“Global light-vehicle sales in November were robust and continued the trend the of selling rates above 90 million units. November saw a selling rate of 94 million units and a volume increase of 14% year over year. China continued pace with strong sales that were up 26% from a year ago. Europe and North America had consistent growth, up 12% and 11%, respectively. Korea was a surprise with the selling rate accelerating to 1.8 million units, well above the year-to-date average of 1.7 million units.

“December should finish the year on a high note, with continuing recovery volume and the refilling of sales lost during the pandemic. The selling rate is expected to climb to 95 million units and most markets are expected to grow year over year. China may be a standout, as consumers continue to take advantage of government and industry incentives, plus exports remain robust.

“The current state of the global auto industry is healthy and near-term risks are down slightly from earlier in the year. This year is projected to finish at 89.6 million units, an 11% increase from 2022. In 2024, supply is expected to be sufficient for global demand growth of 3% to 92.3 million units. However, the outlook is not without risks. Most major markets are still dealing with high vehicle prices and there remains risk of recession in North America and Europe. Next year is pivotal for manufacturers and may be the first true test for where natural demand is.”

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info
About GlobalData https://www.globaldata.com/

 

As Expected, Sales Pace Slows in January after Strong December

2024-01-26

jillian.breska

The Total Sales Forecast

Total new-vehicle sales for January 2024, including retail and non-retail transactions, are projected to reach 1,087,900 units, a 1.5% decrease from January 2023, according to a joint forecast from JD Power and GlobalData. January 2024 has 25 selling days, one more than January 2023. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 2.7% from a year ago.

The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 15.2 million units, flat from January 2023.

The Retail Sales Forecast

New-vehicle retail sales for January 2024 are expected to decrease when compared with January 2023. Retail sales of new vehicles this month are expected to reach 862,400 units, a 1.8% decrease from January 2023. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 2.3% from 2023.

The Takeaways

Thomas King, president of the data and analytics division at JD Power:
“After December 2023 reached the strongest sales pace in several years, January’s pace has slowed to 15.2 million units. December’s SAAR of 16.2 million was inflated by elevated discounts from manufacturers, particularly as they aimed to clear out remaining inventory of 2023 model-year vehicles. In addition, changes in the eligibility of many electric vehicles to qualify for government rebates, which took effect Jan. 1, meant many EV purchases that would have occurred in January were made in December. Since January is the month of the year when the fewest vehicles are sold, the aforementioned factors have a bigger effect on the SAAR than they would in higher volume months. In fact, while the drop in the SAAR is notable, January sales results historically are not particularly indicative of future sales performance.”

Retail inventory levels in January are expected to finish around 1.6 million units, a 3.3% increase from December 2023 and 38.1% increase compared with January 2023. Fleet mix is projected at 20.7%, up 0.3 percentage points from January 2023.

“Average new-vehicle retail transaction price is declining mostly due to shifts to smaller and more affordable segments that have increased in availability. Transaction prices in January are trending towards $45,106, down $1,636—or 3.5%—from January 2023. However, even with the decline in average transaction prices, consumers are on track to spend nearly $37 billion on new vehicles this month—the third highest on record for the month of January just 2% lower than January 2023.”

“The increase in new-vehicle supply is resulting in declining per unit dealer profits, but those profits continue to exceed pre-pandemic levels. The total retailer profit per unit—which includes vehicles gross plus finance and insurance income—is expected to be $2,817 in January, down 28.5% from January 2023. The primary factor behind the profit decline is the reduced number of vehicles selling above the manufacturer’s suggested retail price (MSRP). Thus far in January, only 18.5% of new vehicles have been sold above MSRP, which is down from 33.1% in January 2023.”

Total aggregate retailer profit from new-vehicle sales for this month is projected to be $2.3 billion, down 27.4% from January 2023.

“While retailers continue to pre-sell vehicles, rising inventory is enabling more shoppers to buy directly off of dealer lots. In January, 32.7% of vehicles are projected to sell within 10 days of their arrival at the dealership, which is down from the peak of 58% in March 2022. The average time that a new vehicle spends in the dealer’s possession before being sold is expected to be 40 days, up 13 days from a year ago.

“Manufacturer discounts in January are expected to be down $287 from December but have materially increased from a year ago when incentives were near record lows. The average incentive spend per vehicle has grown 74.2% from January 2023 and is currently on track to reach $2,346. Expressed as a percentage of MSRP, incentive spending is currently at 4.8%, an increase of 2 percentage points from January 2023. This month, leasing is expected to account for 25.6% of retail sales, up 7.9 percentage points from 17.8% in January 2023.”

Declining average transaction prices due to increased availability of affordable segments from manufacturers are resulting in a stabilization of average monthly finance payments. The average monthly finance payment in January is on pace to be $721, down $6 from January 2023. That translates to a 0.8% decrease in monthly payments from a year ago. The average interest rate for new-vehicle loans is expected to be 7.1%, an increase of 34 basis points from a year ago. 

“So far in January, average used-vehicle prices are $28,100, reflecting a 2.4% or $694 decrease from January 2023. The decline in used-vehicle values is translating to lower trade-in equity for consumers. The average trade-in equity is trending towards $8,345, down $1,048 from a year ago.”

Sales & SAAR Comparison

U.S. New Vehicle	January 20241, 2	December 2023	January 2023
Retail Sales	862,445 units (1.8% lower than January 2023)2	1,197,943 units	843,299 units
Total Sales	1,087,913 units (1.5% lower than January 2023)2	1,468,996 units	1,059,775 units
Retail SAAR	12.5 million units	13.4 million units	12.9 million units
Total SAAR	15.2 million units	16.2 million units	15.2 million units

¹ Figures cited for January 2024 are forecasted based on the first 16 selling days of the month.
² January 2024 has 25 selling days, one more than January 2023.

The Details

•  The average new-vehicle retail transaction price in January is expected to reach $45,106, down $1,636 from January 2023. The previous high for any month—$47,329—was set in December 2022.
• Average incentive spending per unit in January is expected to reach $2,346, up from $1,346 in January 2023. Spending as a percentage of the average MSRP is expected to increase to 4.8%, up 2.0 percentage points from January 2023.
• Average incentive spending per unit on trucks/SUVs in January is expected to be $2,546, up $1,186 from a year ago, while the average spending on cars is expected to be $1,727, up $434 from a year ago.
• Retail buyers are on pace to spend $37.0 billion on new vehicles, down $0.7 billion from January 2023.
• Trucks/SUVs are on pace to account for 79% of new-vehicle retail sales in January.
• Fleet sales are expected to total 225,468 units in January, flat from January 2023 on a selling day adjusted basis. Fleet volume is expected to account for 20.7% of total light-vehicle sales, up 0.3ppts from a year ago.
• Average interest rates for new-vehicle loans are expected to increase to 7.1%, 34 basis points higher than a year ago.

EV Outlook

Elizabeth Krear, vice president, electric vehicle practice at JD Power:
“The first three weeks of 2024 have started slowly for EV retail share, dropping to 8.1% from a high of 9.2% at the end of 2023. There was a similar dip in January 2023 when new rules for the IRA incentive kicked in specifying income and price limits for EV eligibility. Now, the rules have changed again regarding battery component manufacturing or assembly. Furthermore, the credit is disallowed if any of a vehicle’s battery components were manufactured or assembled by a Foreign Entity of Concern. The result is that several popular EVs have lost the purchase credit.

“For those vehicles and buyers that still qualify, the credit can now be used as a down payment at the point of sale instead of waiting until filing tax returns—and all EVs still qualify for the tax incentive on a lease transaction. Several manufacturers have announced plans to bring their vehicles back into the fold in the coming months by adjusting their supply chains. In the interim, we expect to see more incentives and leasing to bridge the gap.

“With the January IRA changes and the delay of EV vehicle plans by some key manufacturers, we have adjusted our 2024 forecast of EV retail share by a half a percentage point. We forecast EV retail share to reach an average of 12.4% in 2024. Conversely, several manufacturers have restated their commitment to EVs this year. This opens the door for them to capture their share of the 4% EV market growth expected in 2024.”

Global Sales Outlook

Jeff Schuster, group head and executive vice president, automotive at GlobalData:
“Global light-vehicle sales finished the year strongly, posting a selling rate of 94 million units in December 2023—an increase of 13% from December 2022. Strong domestic and export volume in China—up 24% year over year—once again leads the way in increases. North America’s 15% year-over-year increase was boosted by year-end discounting. Europe was up just 4% from December 2022, as Western Europe contracted 4% on base effect in Germany as sales were pulled forward.

“Global light-vehicle sales finished at 90 million units, an increase of 11%, the highest level since the pandemic. While the overall level of risk from internal and external factors is still elevated, a level of stability and more consistency is expected as we start 2024.

“January 2024 is not expected to show any material drop-off in sales momentum as is typical at the start of a year. The selling rate is projected to be at 92 million units with an increase in volume of 30% from January 2023. Much of the projected gain can be attributed to China, as January 2023 was especially weak due to a COVID-19 outbreak and the expiration of some tax incentives. Most other major markets are expected to increase by single digits.

“The forecast for global light-vehicle sales in 2024 is for 92.4 million units, a nominal increase of 2% from 2023, but most of the attention may be below the topline. Regulatory pressure remains on the industry for the transition to EVs and we expect continued expansion of the EV market in 2024. BEVs are forecasted to increase to 15% of global light-vehicle sales and EVs to nearly 35% of sales, but the transition is slower than needed in some markets to meet the various regulations.”

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info
About GlobalData https://www.globaldata.com/

 

Vehicle Dependability Slumps as Rate of Deterioration Increases, JD Power Finds

2024-02-07

jillian.breska

 

TROY, Mich.: 8 Feb. 2024 — Vehicle owners are experiencing lower levels of vehicle dependability after three years of ownership, according to the JD Power 2024 U.S. Vehicle Dependability Study^SM (VDS), released today. The high number of problems owners encounter indicates a decline in long-term vehicle dependability, with increased levels of problems reported for nearly two-thirds of brands included in the study. The industry average has increased 4 problems per 100 vehicles (PP100) year over year to 190 PP100 from 2023. The rate at which problems have increased between 90 days and three years of ownership has increased to 17%, up 5 percentage points from 12% in 2023.

“Historically, VDS model results mirror the results of the respective model year in the JD Power Initial Quality Study, so a deterioration of vehicle dependability is unusual,” said Frank Hanley, senior director of auto benchmarking at JD Power. “This can likely be attributed to the tumultuous time during which these vehicles were built, and owners are keeping their vehicles for much longer. In fact, the average age of vehicles on American roads today is approximately 12 years, which underscores the importance of building a vehicle designed to stand the test of time. Automakers must ensure new vehicle technology introduced today will still meet the customer’s needs years down the road.”

The study, now in its 35^th year, covers 184 specific problem areas across nine major vehicle categories: climate; driving assistance; driving experience; exterior; features/controls/displays; infotainment; interior; powertrain; and seats.

Following are key findings of the 2024 study:

• Infotainment system woes continue to plague owners: As vehicles roll off the assembly line with increasingly more technology, it is not unexpected that the most problematic vehicle category is infotainment (49.1 PP100)—nearly twice as many problems as the next-highest category, which is exterior. Among infotainment issues, Android Auto and Apple CarPlay connectivity (6.3 PP100) is the top problem, followed by built-in voice recognition (6.1 PP100).
• Annoyance with driver assistance alerts grows over time: The number of problems related to driver assistance system alerts has increased between the 90-day ownership period and the three-year ownership period. “Many would think that after three years, owners would become used to the alerts on their vehicle,” Hanley said. “However, that is not the case. Increased problem levels are experienced across multiple driver assistance features including, but not limited to, lane departure warning/lane keeping assistance and forward collision warning/automatic emergency braking.”
• Electrified vehicles more problematic than others: Owners of battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs) experience more problems than owners of gas-powered and hybrid vehicles. BEVs are most troublesome (256 PP100), followed by PHEVs (216 PP100). Hybrids (191 PP100) and gasoline vehicles (187 PP100) fare significantly better. At three years of ownership, tires are a sore spot for BEVs, with 39% of owners saying they replaced tires in the past 12 months—19 percentage points higher than owners of gas-powered vehicles.
• Toyota Motor Corporation wins most segment awards: Toyota Motor Corporation’s nine segment awards is the most received by any automaker since 2017 when the Japanese automaker received 10 awards.
• The most improved brands: The top three brands showing the greatest improvement in the number of problems are Porsche (33 PP100 improvement); Mercedes-Benz (22 PP100 improvement); and Toyota (21 PP100 improvement).

Highest-Ranked Brands

Lexus ranks highest overall in vehicle dependability for a second consecutive year, with a score of 135 PP100. Among premium brands, Porsche (175 PP100) ranks second and BMW (190 PP100) ranks third.

Toyota ranks highest in the mass market segment, with a score of 147 PP100. Buick (149 PP100) ranks second, while Chevrolet (174 PP100) and MINI (174 PP100) each rank third in a tie.

The parent corporation receiving the most model-level awards is Toyota Motor Corporation with nine: Lexus ES, Lexus IS, Lexus NX, Lexus RX, Toyota 4Runner, Toyota Camry, Toyota Corolla, Toyota Tacoma and Toyota Tundra. General Motors Company receives four segment awards for Buick Encore, Chevrolet Equinox, Chevrolet Traverse and Chevrolet Tahoe. BMW AG receives two segment awards for BMW X1 and BMW X6.

The 2024 U.S. Vehicle Dependability Study is based on responses from 30,595 original owners of 2021 model-year vehicles after three years of ownership. The study was fielded from August through November 2023.

To learn more about the U.S. Vehicle Dependability Study, visit https://www.jdpower.com/business/automotive/us-vehicle-dependability-study.

About JD Power
JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

 

Increasing New-Vehicle Sales Drives Record Consumer Spending

2024-02-22

jillian.breska

The Total Sales Forecast

Total new-vehicle sales for February 2024, including retail and non-retail transactions, are projected to reach 1,214,600 units, a 1.4% increase from February 2023, according to a joint forecast from JD Power and GlobalData. February 2024 has 25 selling days, one more than February 2023. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 5.6% from a year ago.

The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 15.4 million units, up 0.4 million units from February 2023.

The Retail Sales Forecast

New-vehicle retail sales for February 2024 are expected to increase when compared with February 2023. Retail sales of new vehicles this month are expected to reach 981,300 units, a 3.8% increase from February 2024. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 8.1% from 2023.

The Takeaways

Thomas King, president of the data and analytics division at JD Power:
“This month, the new-vehicle market is poised for volume growth with total sales expected to rise a modest 1.4% and retail sales growing 3.8%, selling day adjusted. This volume growth is being driven by higher inventory levels, higher manufacturer incentives and lower retailer profit margins, all of which translate into declining average transaction prices. Despite the landscape shifting towards increased volume with diminished per-unit profits, retail customers will still spend more on new vehicles this month than in any other February on record.”

Retail inventory levels are expected to finish around 1.7 million units, a 3.6% increase from January 2024 and a 44.7% increase from February 2023. Fleet mix is projected at 19.2%, down 1.9 percentage points from February 2023.

“The average new-vehicle retail transaction price is declining due to rising manufacturer incentives, falling retailer profit margins and increased availability of lower-priced vehicles. Transaction prices in February are trending towards $44,045, down $1,919 or 4.2%—from February 2023. However, despite the significant decline in average transaction prices, higher sales volumes mean consumers are on track to spend nearly $40.8 billion on new vehicles this month—the highest on record for the month of February, and 4.1% higher than February 2023.

“Total retailer profit per unit—which includes vehicles gross plus finance and insurance income—is expected to be $2,574, down 31.3% from February 2023. Rising inventory is the primary factor behind the profit decline and fewer vehicles are selling above the manufacturer’s suggested retail price (MSRP). Thus far in February, only 17.4% of new vehicles have been sold above MSRP, which is down from 31.7% in February 2023.”

Total aggregate retailer profit from new-vehicle sales for this month is projected to be $2.4 billion, down 25.7% from February 2023.

While retailers continue to pre-sell vehicles, rising inventory is enabling more shoppers to buy directly off dealer lots. In February, it’s projected that 32.7% of vehicles will sell within 10 days of arriving at the dealership, down from the peak of 58% in March 2022. The average time a new vehicle remains in the dealer’s possession before sale is expected to be 43 days in February, marking a 14-day increase from a year ago.

“Manufacturer discounts in February are expected to rise $66 from January and have materially increased from a year ago. The average incentive spend per vehicle has grown 75.3% from February 2023 and is currently on track to reach $2,565. Expressed as a percentage of MSRP, incentive spending is currently at 5.3%, an increase of 2.3 percentage points from a year ago.

“One of the drivers of higher incentive spending is the increased availability of lease deals, and leasing is growing accordingly.  This month, leasing is expected to account for 23.2% of retail sales, up 4.5 percentage points from 18.7% in February 2023.”

After rising consistently during the past few years, average monthly loan payments are stabilizing. The average monthly finance payment in February is on pace to be $722, flat from February 2023. The average interest rate for new-vehicle loans is expected to be 6.9%, an increase of 17 basis points from a year ago. 

“So far, average used-vehicle retail prices are $28,121, reflecting a 2.4% or $700 decrease from February 2023. The decline in used-vehicle values is translating to lower trade-in equity for consumers. The average trade-in equity is trending towards $7,912, down $992 from a year ago.

“It’s apparent that the industry is returning to traditional pre-pandemic dynamics after nearly three years of inventory constraints. Competition between OEMs and retailers to attract buyers to showrooms is rising, and the seasonality of both consumer demand and promotional activity is returning. This is good news for shoppers who have struggled to find their desired vehicle at an affordable price but points to a more challenging profit environment for OEMs and retailers.”

Sales & SAAR Comparison

U.S. New Vehicle	February 20241, 2	January 2024	February 2023
Retail Sales	981,343 units (3.8% higher than February 2023)2	855,187 units	907,768 units
Total Sales	1,214,623 units (1.4% higher than February 2023)2	1,057,761 units	1,150,496 units
Retail SAAR	12.8 million units	12.4 million units	12.2 million units
Total SAAR	15.4 million units	14.8 million units	14.9 million units

¹ Figures cited for February 2024 are forecasted based on the first 15 selling days of the month.
² February 2024 has 25 selling days, one more than February 2023.

The Details

• The average new-vehicle retail transaction price in February is expected to reach $44,045, down $1,919 from February 2023. The previous high for any month—$47,329—was set in December 2022.
• Average incentive spending per unit in February is expected to reach $2,565, up from $1,464 in February 2023. Spending as a percentage of the average MSRP is expected to increase to 5.3%, up 2.3 percentage points from February 2023.
• Average incentive spending per unit on trucks/SUVs in February is expected to be $2,722, up $1,221 from a year ago, while the average spending on cars is expected to be $1,944, up $633 from a year ago.
• Retail buyers are on pace to spend $40.8 billion on new vehicles, up $1.4 billion from February 2023.
• Trucks/SUVs are on pace to account for 79% of new-vehicle retail sales in February.
• Fleet sales are expected to total 233,279 units in February, down 7.7% from February 2023 on a selling day adjusted basis. Fleet volume is expected to account for 19.2% of total light-vehicle sales, down 1.9 percentage points from a year ago.
• Average interest rates for new-vehicle loans are expected to increase to 6.9%, 17 basis points higher than a year ago.
   

EV Outlook

Elizabeth Krear, vice president, electric vehicle practice at JD Power:
“In 2023, EV sales and leases accounted for a larger percentage of retail auto industry growth than gas-powered vehicles. Industry-wide, automobile sales and lease volumes rose 8% in 2023 from 2022, reaching a total of approximately 13 million units. With approximately one million in total volume for the year, EV sales and leases grew 50%, while gas-powered vehicles grew 2%.

“But 2024 has started with slowing EV sales. In January, battery electric vehicle sales fell 1.6 percentage points from 9.2% in December 2023. Further, upper-funnel EV shopper interest declined for a fourth consecutive month. New-vehicle shoppers who are ‘very likely’ to consider purchasing an EV for their next vehicle dropped to 25.6%, a full percentage point lower than in December. Shoppers cite a lack of charging station availability as the main reason for rejecting EVs.

“That said, some good news is on the way. Infrastructure scores have improved 5 percentage points, marking the most significant increase in the three years of EV history tracked by JD Power. The improvement is driven largely by non-Tesla charging installations at higher power levels and upgrades to the existing networks. Infrastructure scores are expected to continue increasing this year as the Tesla Supercharger network is opened to non-Tesla EVs. But this alone is not enough to move the needle. Improvement is needed in terms of the availability of affordable EVs for mainstream customers.”

Global Sales Outlook

Jeff Schuster, group head and executive vice president, automotive at GlobalData:
“The global light-vehicle sales selling rate cooled in January, as expected, from the strong finish to 2023. The selling rate was 81.5 million units, which is down from the 90-million-unit selling rate in December. [It should be noted that, beginning this month, we are reporting domestic sales in China and excluding Chinese exports that were previously included.] Global sales volume was up 16% year over year, which is strong, but January usually faces some distortions. As has been the story for several months, China domestic sales have outperformed most markets, but the near 50% increase in January is due to abnormal weakness a year ago caused by the expiration of tax incentives and timing of the Lunar New Year. Europe increased 11%, with recovery in Eastern Europe boosting sales across the region. North America grew just 2% as volume in January was pulled down by the weaker start to the year in the United States.

“Global light-vehicle volume in February is projected to be flat vs. February 2023, but again, distortions are affecting the year-over-year comparison. The selling rate is expected to increase to 86 million units. Base effect in China is the main cause for the weaker volume expectation as China domestic sales are expected to fall 13% from February 2023. 

“Global light-vehicle sales in 2024 are projected to be 89.1 million units (adjusted for China exports), an increase of 3% from 2023. This maintains our view that growth will slow as natural demand—at current pricing—is now being met. Global inventory is expected to build slightly in 2024 as production returns to predictable levels and outpaces demand. This year remains on target to return to a more normalized pattern of demand, but the market will not be without challenges from an economic slowdown and from external factors, like the Red Sea shipping attacks and the potential for military escalation in the Middle East.”

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

About GlobalData https://www.globaldata.com/

 

Quality and Styling Distinguish Top EV Models, but Public Charging Woes Felt by All, JD Power Finds

2024-02-27

jillian.breska

 

TROY, Mich.: 27 Feb. 2024 — As more car buyers make the switch to battery electric vehicles (BEVs), traditional factors that are also important to buyers of gas-powered vehicles are becoming critical to satisfaction among BEV owners. Quality and cost of ownership have emerged as the top factors influencing satisfaction, according to the JD Power 2024 U.S. Electric Vehicle Experience (EVX) Ownership Study,^SM released today. The study also reveals that public charger availability not only remains the least satisfying aspect of owning a BEV, but also that the experience has become notably worse.

The BMW i4 ranks highest overall and among premium BEVs, while the MINI Cooper Electric is the highest-ranking mass market BEV for a second consecutive year. Both models rank highest in their respective segment on the strength of their performance in the vehicle quality and reliability factor. Each model scores more than 60 points (on a 1,000-point scale) higher than their respective nearest segment competitor for that factor.

“The increase in the EV share of the new-vehicle market, reflected by seven new rank-eligible models this year, is a notable step in the transition toward vehicle electrification,” said Brent Gruber, executive director of the EV practice at JD Power. “Many products are hitting the mark and resonating with shoppers but, at the same time, the decline in satisfaction with public charging availability should serve as a warning because concern about access to public charging is a key reason many buyers currently reject BEVs. For EVs to reach their full potential, this issue needs to be resolved.”

Following are key findings of the 2024 study:

• Public charging isn’t just bad—it’s getting worse: The study finds that the public charging experience continues to be a major source of EV owner frustration. Further, non-Tesla owners indicate that the situation is deteriorating. Among mass market BEV owners, satisfaction with public charger availability is 32 points lower than a year ago. “The industry should view this lack of improvement as a critical issue that requires decisive action,” Gruber said.
• Mass market BEVs deliver higher quality than premium BEVs: Owners of mass market brand BEVs experience fewer problems with their vehicle than do owners of premium BEVs. Eleven of the 14 ranked mass market models outperform the premium brand market average in total problems. “Quality and reliability are the most important drivers of a positive EV ownership experience,” Gruber said. “As EVs extend to the broader market, minimizing problems will be key to meeting consumer expectations.”
• First-time BEV owners are less satisfied than BEV veterans: Buyers new to BEV ownership are less satisfied than those who have previously owned a BEV. This year, the satisfaction gap between the two groups is 28 points, whereas a year ago, the gap was 14 points. Overall satisfaction among first-time BEV owners has declined 16 points from 2023. Battery range and public charging availability are the two factors in which the gap between previous BEV owners and new owners is greatest.
• Most BEV owners say they’ll consider a BEV again, but first-time BEV owners may be more fickle: First-time BEV owners say they are open to considering non-BEVs in the future. However, almost half (48%) say they will consider a plug-in hybrid vehicle (PHEV) and 39% say they are willing to consider hybrid or internal combustion engine (ICE) vehicles. Meanwhile, 38% of previous BEV owners say they are willing to consider a PHEV and only 19% would consider a hybrid or ICE vehicle for their next purchase.
• PHEVs might not present a good alternative to BEVs: Recently, news reports have suggested that plug-in hybrid vehicles could solve many of the issues plaguing BEVs, such as range limitations and lack of public charging availability. However, this year’s study finds that owners of PHEVs are, on the whole, much less satisfied with their vehicle than are owners of BEVs. Overall satisfaction with PHEVs is 629, while mass market BEVs (718) and premium BEVs (750) score much higher. “Plug-in hybrids may not be the simple solution to solving early issues with full battery electric vehicles,” Gruber said. “Expected lower running costs is a top purchase reason for EVs but satisfaction with the cost of ownership is much lower for plug-in hybrids. Plug-in hybrids retain the costs of maintaining a traditional powertrain yet without the benefit of the extended electric driving range found in full battery electric vehicles.”

Study Rankings

BMW i4 ranks highest overall and highest in the premium BEV segment with a score of 800. Rivian R1T (789) ranks second and Rivian R1S (778) ranks third.

MINI Cooper Electric ranks highest in the mass market BEV segment for a second consecutive year, with a score of 770. Ford Mustang Mach-E (764) ranks second and Hyundai IONIQ 6 (759) ranks third.

The number of award-eligible models in the premium segment has grown from five to eight year over year. Award-eligible mass market models have increased from 10 to 14. Satisfaction among owners of premium EVs averages 750, while satisfaction among mass market EV owners averages 718.

The U.S. Electric Vehicle Experience (EVX) Ownership Study, now in its fourth year, focuses on the crucial first year of ownership. The overall EVX ownership index score measures electric vehicle owner satisfaction in both premium and mass market segments. The 2024 study includes 10 factors (in alphabetical order): accuracy of stated battery range; availability of public charging stations; battery range; cost of ownership; driving enjoyment; ease of charging at home; interior and exterior styling; safety and technology features; service experience; and vehicle quality and reliability.

The study is conducted in collaboration with PlugShare, the leading EV driver app maker and research firm. This study sets the standard for benchmarking satisfaction with the critical attributes that affect the total or overall EV ownership experience for both BEV and PHEV vehicles. Survey respondents for the 2024 study include 4,650 owners of 2023 and 2024 model-year BEVs and PHEVs. The study was fielded from August through December 2023.

For more information about the U.S. Electric Vehicle Experience (EVX) Ownership Study, visit https://www.jdpower.com/business/automotive/electric-vehicle-experience-evx-ownership-study.

About PlugShare
Based in El Segundo, Calif., PlugShare maintains the most comprehensive census of EV infrastructure in the world. They make the PlugShare app for iOS, Android and the Web, the most popular EV driver app globally, in use by most drivers in North America and more than seven million EV drivers worldwide. PlugShare also provides sophisticated data tools, reports, custom consulting and comprehensive research on EVs for automakers, utilities, charging networks, government and the rest of the EV industry. It operates the world’s largest EV driver survey research panel, PlugInsights, now with more than 150,000 members.

About JD Power
JD Power is a global leader in consumer insights, advisory services, and data and analytics. A pioneer in the use of big data, artificial intelligence (AI), and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power has offices in North America, Europe, and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

 

Best Premium Battery Electric Vehicles 2024

Premium Battery Electric Vehicles	Score
BMW 14	800
Rivian R1T	789
Rivian R1S	778
Tesla Model 3	756
Tesla Model Y	752
Segment Average	750
Volvo C40 Recharge	730
Volvo XC40 Recharge	719
Audi Q4 e-tron	680

 

Best Mass Market Battery Electric Vehicles 2024

Mass Market Battery Electric Vehicles	Score
MINI Cooper Electric	770
Ford Mustang Mach-E	764
Hyundai IONIQ 6	759
Kia EV6	739
Nissan Ariya	739
Chevrolet Bolt EUV	738
Chevrolet Bolt EV	733
Hyundai IONIQ 5	727
Segment Average	718
Kia Niro EV	706
Ford F-150 Lightning	704
Subaru Solterra	691
Volkswagen ID.4	677
Hyundai Kona EV	675
Nissan LEAF	651

 

JD Power Sets Sights on European Expansion with Completion of Autovista Group Acquisition

2024-02-29

[email protected]

TROY, Mich.: 1 March 2024 — JD Power, a global leader in data analytics, today announced the completion of its acquisition of Autovista Group, a leading pan-European and Australian automotive data, analytics and industry insights provider. The acquisition, which was announced in September 2023, brings together Autovista Group’s comprehensive datasets, insights and industry expertise with JD Power market-leading predictive analytics and valuation and customer experience datasets. 

“Autovista Group is home to some of Europe and Australia’s most well-known brands in automobile valuation, repair estimation and predictive analytics, and they have been pioneering the use of data-driven insights since the early 1930s,” said Dave Habiger, president and CEO at JD Power. “Bringing the Autovista Group team into the JD Power family will help leverage our complementary strengths to develop even more powerful insights and forecasting solutions for our worldwide client base.” 

Through its six leading brands—Autovista, Eurotax, Glass’s, Schwacke, Rødboka and EV Volumes—Autovista Group standardizes and categorizes hundreds of technical attributes for virtually every vehicle produced in their markets, providing clients with a 360-degree view of detailed vehicle data for use in valuations, forecasts and repair estimates. In addition, its robust analytic solutions and team of experienced analysts are relied upon by stakeholders throughout the automobile industry for detailed insights and benchmarks for vehicle values and ownership, repair and replacement costs. 

“We are living at an historic moment in the automobile industry when future success will largely be determined by how well the industry adapts to massive changes in everything from new powertrains to the use of AI,” said Lindsey Roberts, formerly CEO at Autovista Group and now president at JD Power Europe. “I believe our mutual obsession with data-driven innovation will help our clients navigate through this period of change with confidence.” 

Along with Roberts, Autovista Group’s senior leadership and its 750 employees will continue with the company and will become the JD Power automotive data and analytics platform for Europe and Australia. 

Autovista Group was previously owned by Hayfin Capital Management, a leading European alternative asset management firm. 

RBC Capital Markets served as exclusive financial advisor and Kirkland & Ellis served as legal advisor to JD Power. TD Cowen served as exclusive financial advisor and Macfarlanes, Cravath, Swaine & Moore and Mishcon de Reya served as legal advisors to Autovista Group and Hayfin. 

About JD Power 

JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies. 

JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com. 

 

Dealer Service Satisfaction Improves but Appointment Wait Times Continue to Grow, JD Power Finds

2024-03-14

jillian.breska

 

TROY, Mich.: 14 March 2024 — While customer satisfaction with the dealer service experience has rebounded this year, dealers continue to grapple with parts and labor shortages that are fueling longer wait times for appointments, according to the JD Power 2024 U.S. Customer Service Index (CSI) Study,^SM released today. Overall customer service satisfaction improves five points to 851 (on a 1,000-point scale).

“It’s encouraging to see an improvement in service satisfaction but, unfortunately, the capacity and wait time issues have gotten progressively worse since the pandemic and show no immediate signs of easing up,” said Chris Sutton, vice president of automotive retail at JD Power. “Excluding Tesla owners, the service experience for BEV owners is underwhelming. As sales of BEVs continue to grow and the industry moves out of the early-adopter phase, the typical owner will not be as willing to tolerate a less-than-stellar service and ownership experience. On the manufacturer side, a higher rate of BEV recalls is also contributing to an inconsistent experience. This is an area that automakers and dealers need to address now to help make the transition to electrification as pain-free as possible for owners in the future.”

Contributing to the poor service experience of non-Tesla BEV owners is a notable lack of trust with servicing dealers to perform complex repairs and provide useful guidance. Overall dealer trust among non-Tesla BEV owners is 5.62 (on a 7-point scale) but jumps to 6.00 among owners of gas-powered vehicles owners and 5.74 among plug-in hybrid (PHEV) owners.

The study, now in its 44^th year, has grown to include emerging features such as valet service, mobile vehicle servicing and online/smartphone app payment options to gauge the effect these processes have on the service experience. The study measures satisfaction with service at franchised dealer or aftermarket service facilities for maintenance or repair work among owners and lessees of one- to three-year-old vehicles. It also provides a numerical index ranking of the highest-performing automotive brands sold in the United States, which is based on the combined scores of five measures that comprise the vehicle owner service experience. These measures are (in order of importance): service quality; service advisor; vehicle pick-up; service facility; and service initiation. In 2023, model segment rankings were added to the study to differentiate between the service needs of cars, trucks, SUVs and minivans.

Following are key findings of the 2024 study:

• Appointment wait times for mass market vehicles continue to increase: On average, owners of mass market vehicles wait 5.2 days for an appointment at the dealer, up from 4.8 days in 2023, while owners of premium vehicles wait 5.4 days—slightly better than a year ago. Wait times in both segments are still significantly higher when compared with pre-pandemic levels.
• Customers want prompt service appointments: Longer wait times at dealers are driving more customers to aftermarket service facilities. Among customers in the mass market segment, 35% now choose aftermarket service because of the ability to be seen right away, surpassing cheaper costs (34%) as a reason for choosing such service. Notable, too, is that 55% of customers choose aftermarket service due to convenience of location.
• Technology improves service experience: Using technology is an important part of enhancing the service experience. Customers are four times as likely to indicate they would like to get service updates via text message (68%) than a phone call (16%). Additionally, when service advisors provide photos or videos to support the results of a multi-point inspection (MPI), customer satisfaction with their advisor improves 31 points than when no photos or videos are shared (911 vs. 880).
• Amount spent per dealer visit continues to climb: During the past two years, the average amount spent on a recent dealer service visit has risen 30% for owners of both premium and mass market vehicles. Owners of premium vehicles pay an average of $380, up $66 from 2023, while owners of mass market vehicles pay $140, a year-over-year increase of $15. Among customers whose service is not covered by warranty or a maintenance contract, these increases can be attributed to inflation and higher costs for parts and labor.
• Non-Tesla BEV owners are the least satisfied of them all: Owners of non-Tesla BEVs experience recalls slightly more than twice as often as do owners of gas-powered vehicles. Compounding the problem, overall service satisfaction with recall work is 782 among these affected owners—50 points lower than among owners of gas-powered vehicles (832). In fact, non-Tesla BEV owners have the lowest satisfaction with recall work across all other major vehicle categories, including diesel (831), hybrids (827) and PHEVs (821).

Highest-Ranking Brands and Segments

Lexus ranks highest in satisfaction with dealer service among premium brands for a third consecutive year, with a score of 897. Porsche (894) ranks second and Cadillac (883) ranks third.

Buick ranks highest in satisfaction with dealer service among mass market brands with a score of 887. MINI (884) ranks second and Subaru (877) ranks third.

MINI (877) ranks highest in the mass market car segment, followed by Subaru (874) and Mazda (867).

Buick ranks highest among mass market SUVs/minivans with a score of 887. Mitsubishi (877) and Subaru (877) each rank second in a tie.

Porsche (902) ranks highest in the premium car segment, followed by Infiniti (900) and Lexus (892).

Lexus ranks highest in the premium SUV segment for a second consecutive year, with a score of 898. Porsche (889) ranks second and Cadillac (882) ranks third.

Nissan ranks highest in the truck segment for a second consecutive year, with a score of 873. Chevrolet (856) ranks second and Toyota (855) ranks third.

The 2024 U.S. Customer Service Index (CSI) Study is based on responses from 64,781 verified registered owners and lessees of 2021 to 2023 model-year vehicles. JD Power goes to great lengths to ensure that survey respondents are true owners of the brand they are representing. The study was fielded from August through December 2023.

For more information about the U.S. Customer Service Index (CSI) Study, visit https://www.jdpower.com/business/automotive/us-customer-service-index-csi-study

About JD Power
JD Power is a global leader in consumer insights, advisory services, and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power has offices in North America, Europe, and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info