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TechnoMetrica Auto Demand IndexDecember 2013

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TechnoMetrica, founded in 1992, is a full‐service Market Research consultancy that helps businesses identify, develop and capitalize on growth opportunities. Spotting trends and synthesizing insights that are well‐defined, accurate, and forward‐thinking is our passion. y g g , , g pResearch is the foundation for all our endeavors.

TechnoMetrica is a thinkery. We harness the power of creative thinking in everything we do: to develop study designs that best answer research objectives; to communicatedo: to develop study designs that best answer research objectives; to communicate research findings with impact; to develop effective marketing strategies and new product development. Our creations are the true testimonies that reflect our depth of thinking. Our clients are our ambassadors of our reputation.

In 1996, TechnoMetrica founded TIPP – the TechnoMetrica Institute of Policy and Politics. Shortly thereafter, TIPP joined forces with Investor’s Business Daily (1996 to present) –the nation’s fastest‐growing financial publication – to produce their highly respectedthe nation s fastest‐growing financial publication – to produce their highly respected IBD/TIPP Economic Optimism Index. TIPP also has a similar polling partnership with the Pulitzer Prize‐winning Christian Science Monitor (1998 to present).

TechnoMetrica Auto Demand Index – December 2013

Table Of ContentsI M h d l 4 5I. Methodology 4‐5

II. Auto Demand Index 6‐15

A. Auto Demand Index (Overall)B. By RegionB. By RegionC. By Area TypeD. By AgeE. By Gender/Marital StatusF. By Parental Status and Race/EthnicityG B H h ld IG. By Household Income

III. Demand For New Autos 16‐21A. Vehicle Purchase/Lease Plans: OverallB. Vehicle Purchase Plans: Purchase Likelihood Over TimeC. New Vehicle Purchase/Lease Time FrameD. Vehicle Types MomentumE. Preferred Vehicle Types 3SMA

IV. Brand Preferences 22‐28A. Top Ten Brands Consumers Would Buy Today 3 SMAB. Brand Preferences Over Time 3 SMA (Top Ten Brands)

V. Appendix A. Correlation Between ADI and U.S. Auto Sales


B. Gas Prices To ADI Correlation 30‐32VI. Contact Information 33

I. Methodologygy

MethodologyTechnoMetrica’s Auto Demand Index is a forward looking early (monthly) indicator ofTechnoMetrica s Auto Demand Index is a forward looking early (monthly) indicator of consumers’ intent to purchase or lease a new vehicle within the next 6 months. The index has been set to an initial value of 100 based on demand levels between February 2007 and April 2007, the strongest selling season in the past decade.

The Auto Demand Index is based on the responses Americans give to the question: – How likely is it that you will buy or lease a new vehicle within the next 6 months? Would you say

very likely, somewhat likely, not very likely or not at all likely?

We express purchase intent as an index score that varies as a linear function of the percentage of consumers who are either “very” or “somewhat” likely to purchase or lease a new vehicle within the next 6 months.

Higher index readings correspond to greater demand or intent to purchase/lease new automobiles.

The index and its movement is projectable to the national market for new automobiles, whichThe index and its movement is projectable to the national market for new automobiles, which consists of over 100 million U.S. households with drivers.

Each month, TechnoMetrica uses a monthly Random Digit Dial (RDD) telephone survey to collect the survey data with a sample size of 907 respondents The margin of error is +/ 3 3


collect the survey data, with a sample size of 907 respondents. The margin of error is +/‐ 3.3 percentage points. The December Survey was conducted November 21st – November 25th.

II. Auto Demand Index, Purchase OutlookA. Auto Demand Index (Overall)B. By RegionC. By Area TypeD. By AgeE By Gender and Marital StatusE. By Gender and Marital StatusF. By Parental Status and Race/EthnicityG. By Household Incomey

Auto Demand Index (Overall)Th A D d I d l l f ll li h l hi h 82The Auto Demand Index level fell slightly this month, to 82. In November, the ADI level was 84. High Low

2007 129 79

2008 92 66

Base = All Respondents

Auto Demand Index 3SMA

2009 95 55

2010 97 56

2011 94 49

100

120

Auto Demand Index 3SMA 2012 105 49

2013 86 643SMA= Three Months Simple Moving Average

40

60

80

0

20

40

1 12 12 2 12 2 12 12 12 12 2 12 2 13 13 3 13 3 13 13 13 13 3 13 3


Dec‐1

Jan‐1

Feb‐1

Mar‐1

Apr‐1

May‐1

Jun‐1

Jul‐1

Aug

‐1

Sep‐1

Oct‐1

Nov

‐1

Dec‐1

Jan‐1

Feb‐1

Mar‐1

Apr‐1

May‐1

Jun‐1

Jul‐1

Aug

‐1

Sep‐1

Oct‐1

Nov

‐ 1

Dec‐1

Auto Demand Index Moving AveragesBase = All RespondentsBase = All Respondents

Momentum continues to build for purchase intent, as both the 3 month and 6 month moving averages increased slightly in December. Meanwhile, the 12 month moving average remains unchanged from November.

90

95 3SMA 6SMA 12SMA

3SMA= Three Months Simple Moving Average

6SMA = Six Months Simple Moving Average

12SMA = Twelve Months Simple Moving Average

75

80

85

65

70

75

50

55

60


Dec‐11

Jan‐12

Feb‐12

Mar‐12

Apr‐12

May‐12

Jun‐12

Jul‐12

Aug

‐12

Sep‐12

Oct‐12

Nov‐12

Dec‐12

Jan‐13

Feb‐13

Mar‐13

Apr‐13

May‐13

Jun‐13

Jul‐13

Aug

‐13

Sep‐13

Oct‐13

Nov‐13

Dec‐13

Momentum( h) l ( h)

ADI Auto Sales

Momentum Measure = Fast Average (3‐month) minus Slow Average (12‐month) Base = All Respondents

After slowing down in November, momentum has picked up slightly this month.

1.75

2.10

16

20

0.35

0.70

1.05

1.40

4

8

12

16

Auto

nce be

tween

MA‐A

DI

and

MA‐ADI

‐1.05

‐0.70

‐0.35

0.00

‐12

‐8

‐4

0 Sales

Differen

3 SMa

12SM

‐2.10

‐1.75

‐1.40

‐20

‐16

‐12

iff b


Difference between 3SMA auto sales and 12SMA auto sales

By Region 3 SMABase = All Respondents

9488

8891

106 96100

125

150Northeast

125

150Midwest

12 SMA = 7212 SMA = 86

82 88

25

50

75

100

67 61 72 68 73 64 74

50

75

100

South

0

25

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐130

25

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

West

82 74 65 6981 78

89

75100125150

South

6782 81 81 80

68100

125

150

West12 SMA = 7612 SMA = 79

0255075

J 13 J 13 A 13 S 13 O 13 N 13 D 13

67 5568

0

25

50

75


Q. How likely is it that you will buy or lease a new vehicle within the next 6 months?

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

By Area Type 3 SMABase = All Respondents

92 88 93 89 88100

125

150Suburban

82 85 89 88100

125

150Urban

12 SMA = 75 12 SMA = 85

77 7992 88 89 88

25

50

75

100

58 56 64

82 85 89 88

25

50

75

100

0J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

150Rural

12 SMA = 73

8973

61 5564 61 71

75

100

125

150 12 SMA 73

0

25

50

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13



By Age 3 SMABase = All Respondents

137160 168

150

175

20018‐24

150175200

25‐4412 SMA = 112

12 SMA = 96

93 102

74

91

25

50

75

100

125 99

7485 91

103 96 89

255075100125

0

25

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

20045‐64

025

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

20065+

73 76 70 77100

125

150

175

200

100125150175200

12 SMA = 4712 SMA = 69

64 73 76 69 67 70 77

0

25

50

75

100

44 47 55 49 51 44 51

0255075



J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13 J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

By Gender and Marital Status 3 SMABase = All Respondents

91 92102

95103

100

125

150Male

100

125

150Female

12 SMA = 8812 SMA = 69

73 7791

25

50

75

100 7764 60 60 62 67 64

25

50

75

100

0

25

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐130

25

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

150MarriedSingle

83 77 8290

96 91 86

75

100

125

150

67 64 68 58 62 6778

75

100

125

150 12 SMA = 8712 SMA = 68

0

25

50

7558

0

25

50

75



0J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

By Parental Status and Race/Ethnicity 3 SMABase = All Respondents

111

9487

96105 109 104

100

125

150Parents

100

125

150Non‐Parents

12 SMA = 68

87

25

50

75

10061 63 71 67 71 67

72

25

50

75

100

12 SMA = 102

0

25

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐130

5

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Black/HispanicWhite

78 83 93101 105

9990100

125

150Black/Hispanic

79 72 71 65 72 71 76100

125

150White

12 SMA = 73

0

25

50

7565

0

25

50

75

12 SMA = 92



0J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

By Household Income 3 SMABase = All Respondents

8492 95 93

125

15030K‐50K

125

150Under 30K

12 SMA = 62 12 SMA = 72

84 81 7861

25

50

75

100

58 54

3947

62 68 66

25

50

75

100

150100K+

15050K‐100K

0

25

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐130

25

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

11599 106

92103 107

127

75

100

125

150

7364

7984 93

7686

75

100

125

15012 SMA = 84

0

25

50

75

0

25

50

J 13 J 13 A 13 S 13 O 13 N 13 D 13

12 SMA = 112



J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

III. Demand For New AutosA. Vehicle Purchase/Lease Plans: OverallB. Vehicle Purchase Plans: Purchase Likelihood Over TimeC. New Vehicle Purchase/Lease Time FrameD. Vehicle Types MomentumE Preferred Vehicle Types 3 SMAE. Preferred Vehicle Types 3 SMA

Vehicle Purchase Plansb

Likely14%

Base = All RespondentsDecember 2013

14%

Not Likely86%

In November, the share of Americanswho said they were likely to purchaseor lease a new vehicle in the next sixmonths is 14%, which is unchangedf h i h

25%

from the previous month.

Vehicle Purchase Plans Over Time

10%

15%

20% Likely 3 month SMA

0%

5%

ec‐11

an‐12

eb‐12

ar‐12

pr‐12

ay‐12

un‐12

Jul‐12

ug‐12

ep‐12

Oct‐12

ov‐12

ec‐12

an‐13

eb‐13

ar‐13

pr‐13

ay‐13

un‐13

Jul‐13

ug‐13

ep‐13

Oct‐13

ov‐13

ec‐13


De Ja Fe M A Ma Ju J Au Se O No

De Ja Fe M A Ma Ju J Au Se O No

De

Vehicle Purchase/Lease Time Frameb

90%

100%

December 2013 Base = Potential Buyers

Within 1Not Sure

60%

70%

80%

90% Within 1 Month7%

Between 4 & 6

Months

Not Sure6%

30%

40%

50%

60%

Between 2 & 3

Months79%

0%

10%

20%

30%

Of these likely to purchase or lease, only 7% saythey will do so within one month, while 13%say they will do so within 2 to 3 months. Nearly

Months13%

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Within 1 Month Between 2 and 3 Months Between 4 and 6 Months Not sure

y y yeight in ten (79%) are planning to do so furtherout (within 4 to 6 months).

In December the percentage of likely vehicle buyers within one


Q. Will you make your purchase within the next month, 2 to 3 months, or in 4 to 6 months?

In December, the percentage of likely vehicle buyers within onemonth increased to 7%, from 1% in November.

Vehicle Type Momentumb

12 Month Average 3 Month Average

December 2013 Base = Potential Buyers

31%

Negative Change Positive Change

16%

26%

15%13%

10%8%

4%

14%

6%

14%12%

8% 7%

2%

15%

7%

2%

Compact Small SUV Pickup Large SUV Sub‐compact or Mini

Mid‐size Full‐size Minivan


Q. What type of vehicle are you most likely to buy or lease?

Preferred Vehicle Types Over Time ‐ 3 SMA

24% 23% 22%30%

40%Compact

Base = Potential Buyers

30%

40%Subcompact/Mini

12 SMA = 4 12 SMA = 16

12%16%

19%23% 22%

14%

10%

20%

3% 4% 4% 4%2% 2% 2%

10%

20%

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

2%

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Mid‐Size Full‐Size

20% 19%

29%25%

26% 24%

31%

20%

30%

40%Mid‐Size

15%15%20%

30%

40%Full Size

12 SMA = 14

0%

10%

20%14%

15%

11% 11% 11%15% 15%

0%

10%

20%

12 SMA = 26


0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Preferred Vehicle Types Over Time ‐ 3 SMABase = Potential Customers

30%

Minivan

30%

Pickup

12 SMA = 6 12 SMA = 10

7% 5% 5% 5% 7% 7% 7%10%

20% 15% 14%11%

7%5% 6% 8%10%

20%

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Small SUV Large SUV

17%15% 13%

20%

30%

Small SUV

20%

30%

Large SUV12 SMA = 812 SMA = 13

15%11% 10%

13% 12% 12%

0%

10%8%

9%7%

9%7% 7% 7%

0%

10%


J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐130%

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

IV. Brand PreferencesA. Top Ten Brands Consumers Would BuyB. Brand Preference Over Time 3 SMA (Top Ten Brands)

Top Ten Brands Consumers Would Buy TodaybDecember 2013 Base = Likely Buyers

12 Month Average 3 Month Average

17%

12% 12%

20%

13%% 12%10%

3% 3%5%

2%4%

2%

10%

7% 6%4% 4% 3% 2% 2%

Ford Toyota Honda Chevrolet Nissan Dodge GMC Hyundai BMW Mercedes‐Benz


Sorted by 3SMA

Brand Preference Over Time 3 SMA (Top 4 Brands)Base = Likely Buyers

30%

Toyota

20% 20%

30%

Ford12 SMA = 17 12 SMA = 12

8%9%

13%11% 10% 11%

13%

10%

20%17%

15% 14%17%

20% 19% 20%

10%

20%

Honda

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Ch l t

16%20%

30%

Honda

20%

30%

Chevrolet12 SMA = 1012 SMA = 12

13%9% 8%

12% 13%10%

10%

20%

8%11%

12% 13% 11%8% 7%

0%

10%

20%


0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Brand Preference Over Time 3 SMA (Brands 5‐8)

30%

Nissan

30%

DodgeBase = Likely Buyers

12 SMA = 3 12 SMA = 3

2% 2% 2% 2% 2%5% 6%10%

20%

2% 3%4%

2%4% 3% 4%10%

20%

HyundaiGMC

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

12 SMA 5

20%

30%

Hyundai

20%

30%

12 SMA = 212 SMA = 5

2%5% 4% 4%

1% 2% 3%

0%

10%

20%

8% 7%7%

5% 6% 5% 4%

0%

10%


0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Brand Preference Over Time 3 SMA (Brands 9‐10)

30%

BMW

30%

Mercedes‐BenzBase = Likely Buyers

12 SMA = 4 12 SMA = 2

2% 3% 4%6%

4% 4% 2%10%

20%

1% 1%3% 3% 3% 2%

10%

20%

% 2%

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

0% 1% 1% 2%

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13


By Vehicle OriginbDecember 2013 Base = Likely Buyers

Likely to Purchase by Origin50%

60%

44%

Likely to Purchase by Origin

12 Month Average 3 Month Average40%

44%36%

10%

43%37%

10%20%

30%

American Asian European

0%

10%


Q. If you were to buy a vehicle today, what brand would you buy?

0%J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

European Asian American

Luxury vs. Non‐LuxurybDecember 2013 Base = Likely Buyers

N

3 Month Average100%

Non‐Luxury75%

Not Sure11%

70%

80%

90%

Luxury14%

40%

50%

60%

70%

Non‐Luxury

Not Sure10%

12 Month Average

10%

20%

30%

40%

Luxury

Luxury74%

0%

10%

J‐13 J‐13 A‐13 S‐13 O‐13 N‐13 D‐13

Luxury Non‐Luxury


Q. If you were to buy a vehicle today, what brand would you buy?

Luxury16%

Conclusions

The Auto Demand Index level for December registered at 82, a slight decline of two points from last month’s score. The high point for the ADI in 2013 was August’s reading of 86.

Momentum for the ADI, after slowing down slightly in November, has picked up again this month. Both the 3 month and 6 month moving averages increased in December.

Among demographics, consumers with household incomes greater than $100,000 recorded the greatest increase in intention to acquire a new vehicle. Unmarried and Southern car owners also saw a sharp rise in purchase demand, while those with household incomes between $30 000 and $50 000 experienced the greatest decline overhousehold incomes between $30,000 and $50,000 experienced the greatest decline, over the past three months.

This month, consumers who said they were likely to purchase a vehicle within the next six months remained unchanged from November, at 14%. Demand for mid‐size cars showed the most growth, while preference for compact vehicles dropped sharply.

Ford continues to be the brand that is most frequently named by those intending to


Ford continues to be the brand that is most frequently named by those intending to acquire a new vehicle, followed by Toyota and Honda. Additionally, BMW and Mercedes‐Benz entered the top ten this month.

V. AppendixA. Correlation Between ADI and U.S. Auto SalesB. Gas Prices To ADI Correlation

pp

Correlation Between ADI and U.S. Auto Sales

ADI and U.S. Car sales have strong correlation.R²: 0.5472Correlation: 0 7606

Training set Test set

# of rows: 49 10

CCR n/a n/a

Summary

Correlation: 0.7606 CCR: n/a n/a

Average AE: 0.65287 1.7668947

Average MSE: 1.4180596 4.8434803

Tolerance type: Relative Relative

l

15.626667

16.626667

17.626667

ted Actual Forecasted

Tolerance: 10% 30%

# of Good forecasts: 43 (88%) 9 (90%)

# of Bad forecasts: 6 (12%) 1 (10%)

12.626667

13.626667

14.626667

ual and

Forecast

9.6266667

10.626667

11.626667

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59

Act


Rows

Generated with Alyuda Forecaster XL

Adding Gas Prices To ADI Provides Nearly Perfect Sales Correlation3SMA Sales predicted using 3SMA‐ADI & 3SMA Gas PricesR²: 0.7678Correlation: 0.9027

Training set Test set

# of rows: 49 10

CCR n/a n/a

Summary

I I T bl CCR: n/a n/a

Average AE: 0.6794808 1.1211821

Average MSE: 0.8182215 2.0367258

Tolerance type: Relative Relative

l

Input Value, %

3SMA ‐ADI 63.5%

3SMA Gas Prices 36 5%

Input Importance Table

16.626667

17.626667

ed

Actual Forecasted

Tolerance: 10% 30%

# of Good forecasts: 45 (92%) 10 (100%)

# of Bad forecasts: 4 (8%) 0 (0%)

3SMA Gas Prices 36.5%

12.626667

13.626667

14.626667

15.626667

al and

Forecaste

9.6266667

10.626667

11.626667

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59

Actua


Rows

Regression using Alyuda Forecaster XLGas Prices from Bureau of Economic Analysis

Contact Information

To request a full data set or for any questions, please contact us.

Contact: Raghavan Mayur

Address: 70 Hilltop Road, Suite 1001Ramsey, NJ 07446

Phone: 800‐328‐TECH (8324)201‐986‐1288

Fax: 201‐986‐0119

Email: mayur@technometrica comEmail: [email protected]

Web: www.technometrica.com


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