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2018 PICKUP TRUCK STUDYJ U L Y 2 0 1 8

Truck Survey Background

Goals and Objectives:• Assess economic factors affecting truck market share

• Determine shopper consideration and opinions of mid-size and full-size trucks

• Identify shopper preferences and the most important consideration features when purchasing

Methodology and Sample: • Online quantitative survey fielded to U.S. consumers visiting KBB.com

• Respondents answered on either a desktop or mobile device

• In order to be eligible for this survey, respondents had to be:

• Purchasing/leasing a mid-size/full-size truck in the next 12 months

• Considering one or more mid-size trucks (Tacoma, Colorado, Ranger, Canyon, Ridgeline, Gladiator, Frontier)

• Considering one or more full-size trucks (Chevrolet Silverado 1500, Chevrolet Silverado 2500/3500 HD, Ford F-150, Ford F-250/F-350/F-450 Super

Duty, GMC Sierra 1500, GMC Sierra 2500/3500 HD, Nissan Titan, Nissan Titan XD, Ram 1500, Ram 2500/3500/4450, Toyota Tundra)

• Mid-Size Truck N=764; Full-Size Truck N=1369

Field Dates: January 2018 to April 2018

ECONOMIC FACTORSDRIVING TRUCK SALES

Economic Outlook Remains Optimistic

Source: Federal Reserve, Moody’s Analytics

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

REAL GDP GROWTH RATE

Headwinds Lead to Only Modest Decline in 2018

Source: Cox Automotive, June 2018

16.8

8

9

10

11

12

13

14

15

16

17

18

19

68

19

70

19

72

19

74

19

76

19

78

19

80

19

82

19

84

19

86

19

88

19

90

19

92

19

94

19

96

19

98

20

00

20

02

20

04

20

06

20

08

20

10

20

12

20

14

20

16

20

18

20

20

LIGHT VEHICLE SALES OUTLOOK (MILLIONS)

Cox Automotive Full-Year Forecasts

2018 2019 2020

16.8 16.4 16.5(Up 100K from earlier forecast)

Pickup Sales Are Strong Across Brands

Source: Statista, February 2018

0

500

1000

1500

2000

2500

3000

3500

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

in t

housands

PICKUP TRUCKS VOLUME (IN THOUSANDS)

Honda

Nissan

GMC

Toyota

Ram

Chevrolet

Ford

Trucks Significant Driver of Revenues Across All Brands

Source: Statista, February 2018

0

20000

40000

60000

80000

100000

120000

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

in m

illio

n U

SD

PICKUP TRUCKS REVENUE (IN MILLION USD)

Honda

Nissan

Toyota

GMC

Ram

Ford

Chevrolet

Pickup Truck Share Expands While Cars Decline

Source: HIS/Markit, U.S. Automotive Sales Forecast April 2018

FULL-SIZE

TRUCK

MID-SIZE

TRUCK

COMPACT

CAR

MID-SIZE

CAR

COMPACT

SUV

MID-SIZE

SUV

between

12-14%between

3-4%between

16-13%between

20-13%between

20-29%between

16-18%

from 2015-2025

Truck Consideration Steady; Expected to Climb as New Models Arrive(Ford Ranger, GMC Sierra 1500, Ram 1500, Chevrolet Silverado)

Source: KBB.com Brand Watch Q1 2018 Please select at most 5 vehicles that you are currently shopping.

4%

7%

8%

17%

18%

20%

39%

59%

Luxury Coupe

Minivan

Non-luxury Coupe

Pickup

Luxury Sedan

Luxury Utility Vehicle

Non-luxury Sedan

Non-luxury Utility Vehicle

SEGMENT CONSIDERATION

0%

5%

10%

15%

20%

25%

2015 2016 2017 2018

T R E N D E D P I C K U P C O N S I D E R A T I O N

Economic Expansion Drives Construction and Truck Sales

Source: U.S. Census Bureau, 2007-2018 Construction Spending – Total Construction including both Public and Private Sectors

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

Jan

-200

7

Ma

r-2

007

Ma

y-2

00

7

Jul-

200

7

Se

p-2

00

7

Nov-2

007

Jan

-200

8

Ma

r-2

008

Ma

y-2

00

8

Jul-

200

8

Se

p-2

00

8

No

v-2

008

Jan

-200

9

Ma

r-2

009

Ma

y-2

00

9

Jul-

200

9

Se

p-2

00

9

No

v-2

009

Jan

-201

0

Ma

r-2

010

Ma

y-2

01

0

Jul-

201

0

Se

p-2

01

0

Nov-2

010

Jan

-201

1

Ma

r-2

011

Ma

y-2

01

1

Jul-

201

1

Se

p-2

01

1

Nov-2

011

Jan

-201

2

Ma

r-2

012

Ma

y-2

01

2

Jul-

201

2

Se

p-2

01

2

Nov-2

012

Jan

-201

3

Ma

r-2

013

Ma

y-2

01

3

Jul-

201

3

Se

p-2

01

3

Nov-2

013

Jan

-201

4

Ma

r-2

014

Ma

y-2

01

4

Jul-

201

4

Se

p-2

01

4

Nov-2

014

Jan

-201

5

Ma

r-2

015

Ma

y-2

01

5

Jul-

201

5

Se

p-2

01

5

Nov-2

015

Jan

-201

6

Ma

r-2

016

Ma

y-2

01

6

Jul-

201

6

Se

p-2

01

6

Nov-2

016

Jan

-201

7

Ma

r-2

017

Ma

y-2

01

7

Jul-

201

7

Se

p-2

01

7

Nov-2

017

Jan

-201

8

TOTAL CONSTRUCTION INVESTMENT (IN MILLIONS OF DOLLARS)

New Construction, Builder Confidence Bode Well for Truck Sales

Source: U.S. Census Bureau: New Residential Sales, April 2018Source: NAHB/Wells Fargo National and Regional Housing Market Index (HMI), May 2018

-

100

200

300

400

500

600

700

800

Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18

HOME SALES

+12% Y/Y

-1% M/M

593,000662,000

58

60

62

64

66

68

70

72

74

76

May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18

BUILDER CONFIDENCE

6970

+1% Y/Y

+1% M/M

WHO ARE TRUCK BUYERS?

Respondent Demographics

Source: KBB.com Mid-Size Truck Survey, 2018, N=764, Full-Size Truck Survey, 2018, N=1369

MedianIncome

Gender (Male)

60K

70K

MID-SIZE

FULL-SIZE

84%

89%

53

46

Median Age

Ethnicity

75%

6% 4% 1%

72%

8%3% 2%

Caucasian Hispanic African-American Asian

FULL-SIZEMID-SIZE

Truck Intenders are Mainly Purchasers vs. Lessees

Source: KBB.com Mid-Size and Full-Size Truck Surveys, 2018Q7: Do you plan to purchase or lease your new truck? (N=764)

PURCHASE/LEASE INTENTIONSPurchase Lease

95%

5%

Mid-Size Truck

95%

5%

Full-Size Truck

90%

10%

Compared to Non-Lux SUVs

9YEARS

8YEARS

Mid-Size Truck Full-Size Truck

Average # of Years Shoppers Plan to Hold on to Their Trucks

Source: KBB.com Mid-Size Truck Survey and Full-Size Truck Survey, 2018Q25: When buying a mid-size truck, do you have a preference for where the brand is headquartered? (N=764)

Q25: When buying a full-size truck, do you have a preference for where the brand is headquartered? (N=1369)

PREFERENCE ON WHERE A TRUCK’S BRAND IS HEADQUARTERED

Full-Size Truck Shoppers are More Committed to Domestic Brands;

Mid-Size Considerers are More Likely Neutral to Country of Origin

71%

1%

28%

31%

11%

58%

Domestic

Japan

I have no preference

Full-Size Mid-Size

Full-Size Truck Shoppers Most Loyal Owners.Mid-Size Truck Shoppers Least Loyal, Creating Conquest Opportunities.

Source: 2014-2018 KBB.com Traffic

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

2015 2016 2017 2018

TRENDED SHOPPER LOYALTY

Compact Car Mid-size Car Compact SUV Mid-size SUV Mid-size Truck Full-size Truck Average Loyalty

WHERE ARE TRUCK BUYERS?

Full-Size Pickups Dominate the Heartland.Mid-Size Trucks Proliferate on the Coasts.

Source: IHS/Markit – New Retail Vehicle Registrations March 2017 – March 2018

FULL-SIZE & MID-SIZE PICKUP TRUCK REGISTRATION SHARE

Full-Size Truck

Registration

Midsize-size Truck

Registration

There are Some Geographically Differences in Appeal… Full-Size Truck Share Tend to be Stronger in Middle America


Highest Share %

• ND – 24.2%

• SD – 22.0%

• MT – 18.0%

• NE – 17.4%

• AR – 17.3%

Lowest Share %

• DC – 1.1%

• NJ – 4.1%

• CT – 4.9%

• CA – 5.7%

• MD – 5.8%

FULL-SIZE PICKUP TRUCK REGISTRATION SHARE

… While Mid-Size Trucks are Concentrated in Coastal Areas


Highest Share %

• VT – 5.1%

• AK – 4.8%

• WV – 4.7%

• OR – 4.5%

• NM – 4.4%

Lowest Share %

• DC – 0.7%

• MI – 1.2%

• NJ – 1.4%

• NY – 1.5%

• IL – 1.6%

MID-SIZE PICKUP TRUCK REGISTRATION SHARE

WHY DO PEOPLE BUY TRUCKS?

Truck Shoppers Are Replacing a Truck or Adding a Truck to the Household Fleet

Source: KBB.com Mid-Size Truck Survey, 2018Q: Regarding your next truck purchase, what type of vehicle are you trading in for it? (Select all that apply.) (N=373)

40%

12%10%

4%2% 1%

32%

Truck SUV/CUV Sedan Coupe Hatchback/Wagon Van/Minivan NA, I'm not trading ina vehicle

TRADE IN VEHICLE FOR THE NEXT TRUCK PURCHASE

Shoppers Different Activities with Midsize, Work with Full-Size Trucks

Source: KBB.com Mid-Size Truck Survey, 2018Q28: Please classify the activities that goes best with each category. (N=764)

83%

61%

48%

20%

16%

17%

39%

52%

80%

84%

Towing/Hauling – Cars, Trailers

Home Improvement/Contract Projects

Towing/Hauling – ATV, Motorcycle

Outdoorsy – Camping/Surfing

Urban Delivery for Small Business

ACTIVITIES THAT GO BEST WITH SEGMENT

Mid-Size

Full-Size

Midsize Truck Defectors Heavily Shop Full-Size Trucks and SUVs,Creating an Opportunity to Target Outside of the Traditional Segment.

Source: KBB.com Traffic, Q1 2018 Read as: Mid-Size Truck and Full-Size Truck are cross shopping each other at the rate of 12.9% and Mid-Size Truck is defecting to Full-Size Truck at the rate of 28%

Full-Size Truck 12.9%

6.7%

6.6%

3.8%

3.7%

Mid-Size SUV

Compact SUV

Compact Car

Mid-Size Car

CROSS SHOPPING DEFECTION

MID-SIZETRUCK

Full-Size Truck 28.0%

18.9%

17.5%

10.5%

9.4%

Compact SUV

Mid-Size SUV

Compact Car

Mid-Size Car

While Mid-Size Truckers are More Likely to Upsize, Full-Size are Looking at SUVs

CROSS SHOPPING DEFECTION

Mid-Size Truck 3.8%

3.7%

3.2%

2.4%

2.3%

Mid-Size SUV

Compact SUV

Mid-Size Car

Compact Car

FULL-SIZETRUCK

Mid-Size SUV 20.7%

17.4%

10.5%

10.3%

10.0%

Compact SUV

Mid-Size Truck

Mid-Size Car

Compact Car

Source: KBB.com Traffic, Q1 2018 Read as: Full-Size Truck and Mid-Size Truck are cross shopping each other at the rate of 3.8% and Full-Size Truck is defecting to Mid-Size SUV at the rate of 20.7%

WHAT DO BUYERS WANT IN IN THEIR TRUCKS?

Reliability is The Most Important Factor To Shoppers, Followed by Best Value For My Budget, Then Good Brand Experience

Source: KBB.com Mid-Size Truck Survey and Full-Size Truck Survey, 2018Q23: Which of the following factors is the MOST important to you when considering a mid-size truck? (N=764)Q23: Which of the following factors is the MOST important to you when considering a full-size truck? (N=1369)

1.8%

2.4%

3.8%

4.3%

5.6%

5.8%

6.7%

8.2%

17.5%

31.3%

1.5%

2.6%

1.4%

6.6%

6.3%

6.7%

3.8%

10.7%

15.9%

26.6%

Safety ratings

Maintenance costs

Reviews/ratings/awards

Good experience with this same model

Driving comfort

Driving performance

Fuel economy

Good experience with this brand of vehicle

Best value for my budget

Reliability

MOST IMPORTANT FACTORS WHEN CONSIDERING...

Full-size

Mid-size

Full-Size Considerers Require More Truck Specific Features –Rugged Ones

Source: KBB.com Midsize and Full-Size Surveys, 2018 Q9: Of the following features, what are your must-haves for your next mid-size truck? (You can select up to 3 features.) (N=764)Q9: Of the following features, what are your must-haves for your next full-size truck? (You can select up to 3 features.) (N=1369)

Note: Sample was rebased with “NA, I don’t require any of these features” removed

1.7%

2.0%

2.7%

10.2%

10.2%

15.2%

16.7%

23.4%

23.7%

24.2%

24.4%

46.1%

1.0%

4.4%

3.3%

6.4%

4.4%

16.6%

17.7%

21.1%

14.8%

20.1%

45.0%

58.0%

GoPro mount on windshield

Remote power tailgate

Speakers in the bed

Extendable bed

Dual-action tailgate

Built-in Dashcam

Power outlet in truck bed

Wireless phone charging

Stowable rear seats

Hidden storage compartments

Trailer stability assist

Off-roading package

MUST-HAVES FOR NEXT TRUCKS

Full-Size

Mid-Size

REQUIRE SPECIFIC TRUCK FEATURES?

FULL-SIZE

57%YES

MID-SIZE

52%YES

AWD/4WD and Electronic Stability Control are Required by Truck Shoppers

Source: KBB.com Mid-Size Truck Survey and Full-Size Truck Survey, 2018Q24: Please select up to 5 features that your next mid-size/full-size truck must have in order for you to purchase it: (N=764, N=1369)

Note: Full list was 27 features

69%

40%

33%

20%

13%

57%

38%

30%

19%17%

AWD or 4WD Backup camera Bluetooth (allows phoneconnectivity)

Automatic headlights Electronic stability control(vehicle traction)

TOP 5 MUST-HAVE FEATURES

Full-Size Mid-Size

COMPARED TO

NON-LUX SUVS

NORMS

18% 36% 37% 21% 1%

Mid-Size Truck Shoppers Want Gas Engines; 1 in 10 Open to HybridsFull-Size Shoppers Most Open to Diesel

Source: KBB.com Mid-Size and Full-Size Truck Surveys, 2018Q8A: Which of the following fuel/power sources are you considering for your new truck? (Select all that apply.) (N=764, N=1369))

Q8B: What is the combined (city/highway) MPG you expect from your next mid-size/full-size truck? (N=764, N=1369))

2%

9%

13%

0%

94%

23%

24%

53%

Compressed natural gas (CNG)

Hybrid

Diesel

Considering both gas and diesel

Gasoline

FUEL/POWER SOURCE CONSIDERATION

Full-size Truck Mid-size Truck

Full-Size

Mid-Size

19.2

22.1

ON AVERAGE, CONSUMERS EXPECT

A COMBINED (CITY/HIGHWAY) MPG

Hybrid Truck Intentions Are Low but Alternative Fuel Trucks Are Coming

A-BATRAM 1500 with

Mild Hybrid System

F-150 Hybrid W-15

Mid-Size Trucks Shopped for “Outdoorsy” Dimension

Source: KBB.com Consumer Sentiment Survey (July-Dec, 2017) N = 7103

Full-Size Trucks Perceived as Outdoorsy AND Thrill Seeking.Domestic Partisanship is Key Factor.

Source: KBB.com Sentiment Survey (July-Dec, 2017) N = 7103

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

Pre

dic

ted

Co

ns

ide

rati

on

Consideration Within Bottom 25% Overall Consideration Consideration Within Top 25%

Domestic

PartisanEco-

Conscious

Family

Oriented Financially

Responsible

Image

Conscious

OutdoorsySelf-

Confident

TechieThrill

Seeker

Fullsize Pickup

Source: KBB.com Mid-Size Truck Survey, 2018Q31: When considering a mid-size truck, which would you prefer when it comes to infotainment (e.g. to make hands-free calls, access navigation, control music)? (N=764)

Q32: Would a mid-size truck having Apple CarPlay/Android Auto make you more likely to purchase it? (N=764)

23%

11%66%

PREFERENCE ON INFOTAINMENT

Apple CarPlay and/or Android Auto

A proprietary system created by the manufacturer

I have no preference

6%

11%

15%

67%

INFLUENCE OF APPLE CARPLAY/ ANDROID AUTO ON PURCHASING

Extremely more likely to purchaseSomewhat more likely to purchaseSlightly more likely to purchaseNo influence at all

There is No Real Preference When it Comes To Infotainment

24%

14% 14%

5%

65%

Toyota Safety Sense Subaru EyeSight Honda Sensing Mazda i-Activsense NA, I have never heard of anyof these

% OF SHOPPERS WHO HAVE HEARD ABOUT SAFETY TECHNOLOGIES

There is an Opportunity to Boost Awareness of these Active Safety Systems. About a Third of Shoppers Have Heard of at Least One of the Active Safety Technologies

Source: KBB.com Mid-Size Truck Survey, 2018 Q33: Which of the following active safety technologies have you heard of? (N=764)Q34: With each active safety technology below, have you personally had an experience where the technology prevented an accident?

*Read as: Among those who heard of Toyota Safety Sense (24%), 22% have had an experience with Toyota Safety Sense in which it prevented an accident

22%* 18% 25% 20%

HAD AN EXPERIENCE WHERE THE TECHNOLOGY PREVENTED AN ACCIDENT

Price Perceptions are Lower than Actual ATPs. This is an Opportunity to Message the Starting Prices to Broaden Appeal.

Source: KBB.com Mid-Size Truck Survey and Full-Size Truck Survey, 2018Q13: Typically, mid-size/full-size trucks cost between $20,000 and $40,000. What is the MAXIMUM total price (including options) you will consider for your next new

mid-size/full-size truck purchase? (N=373)

2018 Average Transaction Price

$46,474 or $837 per month

Expected Price

NEW Mid-Sized Truck:


Expected Price

NEW Full-Sized Truck:


2018 Average Transaction Price


BUT WHAT ABOUT FUEL ECONOMY AND RISING GAS PRICES?

Trucks Now Dominate But What About These Higher Gas Prices?

Source: Bloomberg, AAA, Kelley Blue Book, Cox Automotive

Prices at the pump were up 24% Y/Y in May, amounting to about $24 more per vehicle per month in average fuel costs

53%

49% 48%51% 52%

50% 51%53%

57%

61%

65%68%$45.16

$52.52

$34.68

$38.36

$48.36

$52.03 $49.57

$45.61

$29.43

$25.58 $27.82

$34.53

$-

$10.00

$20.00

$30.00

$40.00

$50.00

$60.00

0%

10%

20%

30%

40%

50%

60%

70%

80%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

TRUCK SHARE AND MONTHLY FUEL PREMIUM (ON NEW MODELS)

$-

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

$-

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

$140.00

$160.00

Jan

-05

Au

g-0

5

Mar

-06

Oct

-06

May

-07

Dec

-07

Jul-

08

Feb

-09

Sep

-09

Ap

r-1

0

No

v-1

0

Jun

-11

Jan

-12

Au

g-1

2

Mar

-13

Oct

-13

May

-14

Dec

-14

Jul-

15

Feb

-16

Sep

-16

Ap

r-1

7

No

v-1

7

OIL AND UNLEADED GAS PRICES

WTI Cushing Spot Price Ave Gas Price Unleaded

Rising Oil/Gas Prices May Present Some Challenge to Truck Sales

Source: Bloomberg, AAA, Kelley Blue Book, Cox Automotive

0.80

1.30

1.80

2.30

2.80

May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18

GAS PRICES

Then (2008) And Now (2018): Gas Prices

Source: The Conference Board, Moody’s Analytics

CAR SUV TRUCK VAN OVERALL MPG

2008 24.8 18.6 16.0 17.8 21.4

2009 25.3 19.6 16.2 17.7 22.1

2010 25.8 20.4 16.3 18.0 22.3

2011 26.5 20.8 16.5 18.9 22.8

2012 27.7 21.2 16.5 19.1 23.7

2013 28.5 21.9 16.7 19.1 24.2

2014 28.9 22.3 17.2 19.2 24.5

2015 29.1 22.9 18.0 19.3 24.7

2016 29.4 23.1 18.1 19.4 24.6

2017 29.6 23.4 18.4 19.7 24.6

2018 29.9 23.7 18.5 19.6 24.7

21.4

22.122.3

22.8

23.7

24.224.5

24.7 24.6 24.6 24.7

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

SUV CAR TRUCK

24.7% 20.5% 13.7%

FLEET IMPROVEMENT (2018 vs. 2008)

OVERALL MPG

Fuel Efficiency Gains Will Be Harder To Replicate Going Forward

Source: Kelley Blue Book, Cox Automotive

Even with aggressive goals, the savings diminish with each additional MPG relative to gains already realized

705.9

545.5

387.1

240.0

0

200

400

600

800

1,000

1,200

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60

Gal

lon

s N

eed

ed P

er Y

ear

Miles Per Gallon

FUEL EFFICIENCY GAINS SEE DIMINISH SAVINGS

Truck MPG improvements since 2007 result in 160 less gallons needed

To replicate those gains, trucks need to get to 31 MPG

The next leap would require reaching 50 MPG

Consumers Also Point To $4 Per Gallon As A Tipping Point

Kelley Blue Book, May 2018 Consumer Survey

0%4%

25%

62%

8%

1%

13%18%

45%

22%

Much lower Somewhat lower Stay the same Somewhat higher Much higher

WHERE DO YOU EXPECT GAS PRICES TO BE IN….

30 Days 1 Year Median=

$2.50

Median=

$4.00

At what price per gallon would you consider gas to be reasonable?

At what price per gallon would you consider gas to be so expensive that it greatly affects the type of vehicle you would consider purchasing (i.e. sedan instead of SUV or hybrid instead of standard)?

IS THERE DEMAND FOR AN EVEN SMALLER TRUCK?

The Road Ahead

RETURN OF THE COMPACT PICKUP TRUCKS OF THE 80’S AND 90’S?

Small Truck Could Fill a White Space Missed by Full-Size and Mid-Size

Source: KBB.com Quick Polls, May 29 to June 6, 2018 (N=405)Question: If a small pickup truck (smaller in size than a mid-size truck such as the Toyota Tacoma, Chevy Colorado) were available in the market, how interested

would you be in buying or leasing one?

PURCHASE/LEASE INTEREST IN SMALL PICKUP TRUCK

AMONG THOSE WHO ARE IN MARKET FOR TRUCKS

24%

12%

13%

51%

Very Interest Somewhat Interested Slightly Interested Not Interested At All

Small Truck May Capture Shoppers Looking for More MPG and Affordability

Source: KBB.com Quick Polls, May 29 to June 6, 2018 (N=348)Question: What is the main advantage of a smaller pickup truck vs. a mid-size truck (e.g. Toyota Tacoma Chevy Colorado)? (select top 3)

32%

26%

17%

7% 7% 6%5%

More fuelefficient

More affordable Easier to park Easier toload/unload

cargo

More fun todrive

Morereliable/durable

Safer

MAIN ADVANTAGE OF A SMALL PICKUP TRUCK VS. A MID-SIZE TRUCK

ARE THERE ADVANTAGES

TO A SMALL TRUCK?

72%YES

Enter The Hyundai Santa Cruz to Fill that Need

Source: 2018 IHS Markit Note: Forecasted volume is based on CY20 to CY25 projections

EXPECTED TO HIT SHOWROOMS IN 2020

Santa Cruz Forecasted Volume*17K

• Pickup truck sales are potentially benefitting from the expanding economy and the rise in total

construction in the U.S. This may present an opportunity for OEMs and Dealers to plan for the upswing.

• Despite the new car market softening, it is good news for trucks to garner additional market share.

However, to some extent, it is at the expense of other segments or to a greater extent, from shoppers

looking to replace their trucks or adding to their household fleet. This is an opportunity to strengthen

CRM to retain the loyalists and message to entice shoppers who are new to the pickup market.

• To effectively message to mid-size and full-size shoppers, it is crucial to understand their differences in

psychographic mindsets, usages/activities, pricing expectations, feature needs and more. Targeted,

unique strategies for both types of pickup will reduce cannibalization.

Key Takeaways

4

8

• Shopper loyalty tend to differ significantly between mid-size and full-size pickups and that may be

influenced by the domestic partisan among full-size truck considerers. This may create an opportunity to

shape the mid-size truck landscape for domestic brands launching new trucks soon in an ever-growing

segment.

• There may be an emerging new segment in the pickup market - Small Trucks. Those who are shopping

for more affordability and fuel efficiency may see small trucks as the alternative to mid-size trucks or

SUVs. And the first one to launch in the segment will be the Hyundai Santa Cruz. This may be an

opportunity for OEMs to explore unmet needs and potentially develop a new segment or compete in the

small truck market.

Key Takeaways

THANK YOUM e d i a S t r a t e g i c I n s i g h t s

O E M S a l e s A n a l y t i c s C o n s u l t i n g

BRAND/MODEL SPECIFICS

Construction Investments are Growing and Projected to Expand Further, Which May Be an Opportunity for OEM to Sell More Pickup Trucks to Support New Housing Starts

Source: Statista, February 2018 Note: Housing Starts are based on Residential only

239.04

273.68286.78

308.91330.91

350.28369.29

2015 2016 2017* 2018* 2019* 2020* 2021*

TOTAL HOUSING STARTS (IN BILLIONS USD)

Tacoma Was The Only Truck Seen as a Leader by Shoppers;Shoppers Perceive Colorado and Ridgeline as Modern

Source: KBB.com Mid-Size Truck Survey, 2018Q12: For each truck, choose the single best description. (You can use the same description for multiple trucks.)

Note: For each truck, only respondents who were familiar answered this question.

Colorado Ranger (Old) Canyon Ridgeline Frontier Tacoma

Uncomfortable

Comfortable 1 1 2 2 1 3

Cheap 2 3

Expensive 1 1 2

Mediocre 2 3 3 2

Leader 1

Boring

Fun

Outdated

Modern 3 3

Rugged

Cute

TOP 3 WORDS SELECTED TO DESCRIBE EACH TRUCK

“Best Available” Auto Rates Jumped at the End of April

Source: Bankrate.com, US Federal Reserve, Bloomberg

0

1

2

3

4

5

6

7

8

9

%

INTEREST RATES

New Auto 60 Mo New Auto 48 Mo Used Auto 36 Mo US 10 Year Treasury Fed Discount Rate

TRUCK CONSIDERATION

Tacoma is The Top Truck Shoppers Are Considering Within The Next 12 Months

Source: KBB.com Mid-Size Truck Survey, 2018Q5: Which mid-size trucks are you considering within the next 12 months? (Select all that apply.) (N=764)

7.2%

19.0%

22.5%

23.2%

24.7%

37.7%

56.3%

Gladiator Pickup

Ridgeline

Frontier

Canyon

Ranger

Colorado

Tacoma

Silverado 1500 is a Top Truck Shoppers are Considering Within The Next 12 Months

Source: KBB.com Full-Size Truck Survey, 2018Q5: Which full-size trucks are you considering within the next 12 months? (Select all that apply.) (N=1369)

3%

6%

13%

15%

19%

20%

20%

22%

23%

31%

34%

Titan XD

Titan

Tundra

Sierra 2500/3500 HD

Ram 2500/3500/4450

Silverado 2500/3500 HD

Sierra 1500

Ram 1500

F-250/F-350/F-450 Super Duty

Silverado 1500

F-150

TRUCK CONSIDERATION

Steel May Be Perceived to Be More Durable; But Consideration for Aluminum is Respectable at Around 50%

Source: KBB.com Full-Size and Mid-Size Truck Survey, 2018Q26: Steel vs. aluminum truck bodies. Which do you think is more durable? (Full-Size N=1369, Midsize N=764)

Q27: Are you considering a truck with an aluminum body? (N=1369, Midsize N=764)

51%

48%

Full-size Truck Mid-size Truck

21%

79%

Mid-Size Truck

25%

75%

Full-Size Truck

MORE DURABLE – ALUMINUM OR STEEL?

Steel Aluminum

ALUMINUM BODY CONSIDERATION

MID-SIZE TRUCK FAMILIARITY AND OPTIONS

The Resurgence of the Ranger Back into the Market May Be Disruptive to the Segment with 19% Having Previously Owned it

Source: KBB.com Mid-Size Truck Survey, 2018Q10: Which best describes your experience with each of the following mid-size trucks? (N=764)

13%

13%

23%

21%

28%

37%

1%

2%

3%

6%

19%

10%

1%

2%

4%

3%

4%

10%

Canyon

Ridgeline

Colorado

Frontier

Ranger (OLD)

Tacoma

Have ridden in one Previously owned Currently own

Note: “Never heard of it” and “Have heard of it only” are not charted

MID-SIZE TRUCK EXPERIENCE

The Majority of Shoppers (75%) Have Experienced Silverado 1500

Source: KBB.com Full-Size Truck Survey, 2018Q10: Which best describes your experience with each of the following full-size trucks? (Select all that apply.) (N=1369)

12%

21%

35%

37%

40%

37%

40%

41%

42%

38%

42%

2%

4%

5%

11%

6%

11%

14%

13%

23%

23%

3%

3%

5%

6%

6%

7%

10%

14%

14%

Titan XD

Titan

Tundra

Sierra 2500/3500 HD

Sierra 1500

Ram 2500/3500/4450


Ram 1500


Silverado 1500

F-150

Have ridden in one Previously owned Currently own

Note: “Never heard of it” and “Have heard of it only” are not charted

FULL-SIZE TRUCK EXPERIENCE

TOP 3 DESCRIPTIONS AMONG CONSIDERERS


Read as: Tacoma considerers described Tacoma as being a Leader, Comfortable and Rugged.

Tacoma Frontier Ridgeline Canyon

1. Leader

2. Comfortable

3. Rugged

1. Comfortable

2. Rugged

3. Leader

1. Modern

2. Comfortable

3. Expensive

1. Comfortable

2. Expensive

3. Modern

Comfortable is a Central Theme However Ridgeline and Canyon Stand

Out for Being Perceived as Modern and Expensive

Colorado Ranger Gladiator

1. Comfortable

2. Modern

3. Leader

1. Comfortable

2. Cheap

3. Leader

1. Rugged

2. Fun

3. Leader

The Upcoming Gladiator is Unique as it is Recognized for Fun



Read as: Ranger considerers described Ranger as being Comfortable, Cheap and a Leader.

F-150 Silverado 1500 Sierra 1500 Ram 1500

1. Comfortable

2. Leader

3. Rugged

1. Comfortable

2. Leader

3. Rugged

1. Comfortable

2. Expensive

3. Leader

1. Comfortable

2. Rugged

3. Leader

Full-Size Trucks Share Similar Imageries as Mid-Size Ones


Source: KBB.com Full-Size Truck Survey, 2018Q12: For each truck, choose the single best description. (You can use the same description for multiple trucks.)

Read as: F-150 considerers described F-150 as being as Comfortable, Leader, and Rugged.

Tundra Titan

1. Comfortable

2. Leader

3. Expensive/

Rugged (Tied)

1. Comfortable

2. Modern

3. Expensive/

Rugged (Tied)

Japanese Trucks are Perceived Similarly with Titan

Being Seen as Modern


Source: KBB.com Full-Size Truck Survey, 2018Q12: For each truck, choose the single best description. (You can use the same description for multiple trucks.)

Read as: Tundra considerers described Tundra as being Comfortable, a Leader, Expensive and Rugged.

In Terms of Owner Satisfaction, Tacoma Ranks at The Top

Source: KBB.com Mid-Size Truck Survey, 2018Q11: Overall, how satisfied are you with each of the trucks you own/owned based on the scale below? (Scale: 1 = Not at all

satisfied and 10 = Extremely satisfied)

34%

38%

43%

49%

57%

68%

Ranger OLD (N=176)

Colorado (N=50)

Canyon (N=21)

Frontier (N=69)

Ridgeline (N=28)

Tacoma (N=154)

Note: Data is directional. N values are low for some vehicles.

SATISFACTION WITH TRUCKS OWN/OWNED (TOP 2 BOX)

Silverado’s Owner Satisfaction is Lower Than Others – It Ranks in The Bottom Half

Source: KBB.com Full-Size Truck Survey, 2018Q11: Overall, how satisfied are you with each of the trucks you own/owned based on the scale below? (Scale: 1 = Not at all

satisfied and 10 = Extremely satisfied)

44%

44%

48%

49%

50%

52%

53%

54%

55%

62%

Ram 1500

F-150

Titan

Silverado 1500


Sierra 2500/3500 HD


Sierra 1500

Ram 2500/3500/4450

Tundra

SATISFACTION WITH TRUCKS OWN/OWNED (TOP 2 BOX)

STYLING EXERCISENOTE: ALL VEHICLES WERE DEBADGED

Shoppers Selected Tacoma, Colorado, And Canyon as Having The Best Debadged Styling

Source: KBB.com Mid-Size Truck Survey, 2018Q15: Please choose the 3 vehicles that have the BEST styling. (N=764)

65%

50% 50%

41% 39%

28% 27%

Tacoma Colorado Canyon Frontier Ranger Gladiator Pickup Ridgeline

TOP 3 TRUCKS WITH THE BEST DEBADGED STYLING

Note: All vehicles were debadged and shown to shoppers

The Most Recognizable Debadged Styling Went to Jeep Gladiator;Very Few Respondents Were Able to Identify The New Ranger as a Ford

Source: KBB.com Mid-Size Truck Survey, 2018Q18: You selected the truck below as having one of the BEST styling. Which automaker makes it?

96%

67% 65%57%

45%

34%

19%

Gladiator (N=216) Colorado (N=380) Tacoma (N=493) Frontier (N=317) Canyon (N=380) Ridgeline (N=206) Ranger (N=300)

% OF SHOPPERS WHO GUESSED THE CORRECT AUTOMAKER TO TRUCK

Shoppers Selected Sierra, Silverado, and F-150 As Having The Best Debadged Styling

Source: KBB.com Full-Size Truck Survey, 2018Q15: Please choose the 3 vehicles that have the BEST styling. (N=1369)

72%

61%56%

49%

37%

25%

Sierra 1500 Silverado 1500 F-150 Ram 1500 Tundra Titan

TOP 3 TRUCKS WITH THE BEST DEBADGED STYLING

Note: All vehicles were debadged and shown to shoppers

The Most Recognizable Debadged Styling Went to Ram 1500

Source: KBB.com Full-Size Truck Survey, 2018Q18: You selected the truck below as having one of the BEST styling. Which automaker makes it?

93%

77%69%

59% 58%

24%

Ram 1500(N=675)

F-150(N=761)

Silverado 1500(N=835)

Sierra 1500(N=983)

Tundra(N=513)

Titan(N=340)

% OF SHOPPERS WHO GUESSED THE CORRECT AUTOMAKER TO TRUCK

24%

14% 14%

5%

65%

Toyota Safety Sense Subaru EyeSight Honda Sensing Mazda i-Activsense NA, I have never heard of anyof these

% OF SHOPPERS WHO HAVE HEARD ABOUT SAFETY TECHNOLOGIES

There is an Opportunity to Boost Awareness of these Active Safety Systems. About a Third of Shoppers Have Heard of at Least One of the Active Safety Technologies

Source: KBB.com Mid-Size Truck Survey, 2018 Q33: Which of the following active safety technologies have you heard of? (N=764)Q34: With each active safety technology below, have you personally had an experience where the technology prevented an accident?

*Read as: Among those who heard of Toyota Safety Sense (24%), 22% have had an experience with Toyota Safety Sense in which it prevented an accident

22%* 18% 25% 20%

HAD AN EXPERIENCE WHERE THE TECHNOLOGY PREVENTED AN ACCIDENT

Source: KBB.com Mid-Size Truck Survey, 2018 Q29: In your opinion, which mid-size truck has improved the most in the last 5 years? (N=764)

Q30: Please explain your answer.

29.1% 28.8%

12.6%11.1%

8.2%6.3%

Chevrolet Colorado Toyota Tacoma Honda Ridgeline Ford Ranger GMC Canyon Nissan Frontier

MOST IMPROVED TRUCK IN THE PAST 5 YEARS

Overall, Shoppers Feel Colorado Has Improved The Most in The

Past 5 Years

2018 pickup truck study - b2b.autotrader.com · full-size pickup truck registration share while mid...

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