the industry drags itself across the 17-million mark again...us auto industry was able to achieve a...

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JANUARY 2020 www.mediagrouponlineinc.com

Despite all the red numbers in the table on page 4, especially among the largest light-vehicle brands and manufacturers, the US auto industry was able to achieve a fifth consecutive year of total sales exceeding 17 million units, or 17.11 million, exactly.

Being the end of a quarter, General Motors, Ford, FCA and Tesla published their sales numbers, and the traditional Big Three ended the year with fewer units sold than for 2018.

Among the “Big Three” Japanese automakers, only Hyundai-Kia had a positive December and a respectable 2019 while Toyota’s 2018 unit sales decreased 1.8% and Nissan continues to reel from many internal issues.

It’s likely the smaller brands and manufacturers, collectively, overcame the deficits of the biggest automakers just to push the industry across the 17-million unit line.

Among the outstanding brand performances, Lincoln, at +12.7% for December, certainly helped Ford’s total numbers to be better. Volvo was the big winner, increasing December sales by 40% over December 2018. Most dealers of Kia (+8.0%), Mitsubishi (+10.3%), Audi (+13.6%) and Porsche (+15.8%) had to be happy with their monthly performances.

With five consecutive years of 17 million+ sales, 2020 is likely to be a very interesting year as manufacturers focus on both keeping the traditional internal combustion vehicles rolling off the assembly lines and advancing the pending age of electric vehicles.

The Industry Drags Itself Across the 17-Million Mark Again

A New Year – New Success StrategiesComcast Cable’s 11-member Automotive Advisory Council, which consists of digital, data and marketing analytics experts and highly experienced advertising professionals, offered three trends for 2020 that forward-thinking dealerships will want to consider and adopt.

1. A 21st century cost-efficiency media-buying model

The era of ratings for media buying will rapidly move closer to its end during 2020. The new model is a data-centric approach, using impressions. There will be more opportunities to gather real-time, almost totally accurate data from set-top boxes and other technologies to find and engage directly with the right consumers.

2. Progressive dealerships accelerate their digital transformation

Dealerships that expect to thrive into the 21st century will need a dedicated professional and/or staff to establish relationships

with many more vendors than just traditional media and ad agencies. These may include digital media agencies, data analysts and technology vendors providing new data-gathering and consumer-facing systems and tools.

3. Creative ad content must convey an exclusive benefit of buying from a dealership

One of the oldest concepts in advertising is still relevant during 2020: Consumers don’t care “what you are,” but “why they should buy from you,” or the famous, “What’s in it for me?” It’s time (past time) for dealerships to stop boasting about the size of their inventory, etc. and clearly communicate the most beneficial reason(s) a consumer should buy from one dealership than another.

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MARKETING FORWARD

EXCELLENT REPUTATION SCORES FOR LARGE DEALER GROUPS, PART 3This is part 3 of Media Group Online’s series about the automotive industry’s Reputation Scores as presented in Reputation.com’s 2019 Automotive Reputation Report. Part 3 focuses on large publicly and privately held dealer groups. Part 2 in the December 2019 Automotive Update Report shared the top 10 brands according to their Reputation Scores.

Of the 11 dealer groups included in the report, Hendrick Automotive was first with a Reputation Score of 722 (the average per dealership in the group). For comparison, Lexus had the largest Reputation Score, or 672, among the 28 auto brands ranked.

Although Hendrick Automotive was first overall, AutoNation had the largest Visibility Score, or 84%, and Engagement Score, or 98%; however, Hendrick’s Sentiment Score of 77% was the largest.

Look for the Reputation Scores of the top dealerships in part 4 in the February 2020 Automotive Update Report.

FINANCING STILL STYMIES CONSUMERSThe financing step in the car-buying process is still a major hurdle for consumers, according to the September 2019 Capital One Auto Navigator survey. A surprising, but consistent, finding

is just 26% of survey participants said they were very confident during their car-buying journey, and failing to plan their financing in advance was a major reason for 27% of consumers.

More than half of the survey respondents, or 52%, said they spend the most time (and frustratingly so) engaging with the finance department to finalize the numbers and sign paperwork.

The specific portion of the financing step that confuses many consumers is prequalifying. According to the survey, 88% understand this is different than the preapproval process; however, only half said they would want to prequalify their vehicle financing.

The study’s authors concluded many consumers think prequalifying will affect their credit score, which is not the case. Prequalification only indicates an estimated loan amount for which the consumer would qualify, but without providing any verified personal financial data.

For a preapproval, a consumer must submit personal financial data that is then independently verified in addition to his or her credit score. A lender then approves the consumer for an exact loan amount.

Fifty-seven percent of survey respondents would like dealerships to improve the financing step with simple, open explanations of financing options and other steps in the process.

TOP DEALER GROUPS BY AVERAGE REPUTATION SCORE PER DEALERSHIP, JULY 2019

DEALER GROUPAVG. REPUTATION

SCOREVISIBILITY SCORE

ENGAGEMENT SCORE

SENTIMENT SCORE

Hendrick Automotive 722 77% 91% 77%

AutoNation 704 84% 98% 68%

Group1 696 77% 89% 72%

Sonic Automotive 693 78% 86% 70%

Asbury Automotive Group 673 77% 95% 64%

Penske 656 63% 83% 76%

Lithia 641 74% 55% 68%

Ken Garff Automotive 638 69% 82% 65%

Larry H. Miller 636 76% 81% 62%

Berkshire Hathaway Automotive 618 67% 67% 69%

Greenway Automotive 592 70% 47% 63%

Reputation.com, September 2019

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THE CYBERTRUCK IS SOON TO HAVE MANY RIVALSElon Musk and his Cybertruck may have been receiving all the media coverage about the future of electric pickup trucks (despite the “unbreakable” windows that broke), but many more are expected to hit the market during 2021 when the Cybertruck will first be available.

Although many of the major, traditional automakers have been skeptical and wary of Musk, he has proven to be a serious player with his Tesla brand and his Cybertruck generated 200,000 reservations during the first three days after the announcement.

No doubt, the other manufacturers planning electric pickups took notice of the consumer interest. After all, on average, a bit more than 3 million pickups with internal combustion engines are sold in the US annually.

Some of these other players in the electric pickup sandbox include major automakers, such as General Motors, as well as a number of startups, Lordstown Motors Corp., Bollinger Motors, Hercules Electric Vehicles and Atlis Motor Vehicles – and maybe the best known startup, Rivian, which has investment dollars from Ford and Amazon.

Industry eyes are also on Lordstown Motors Corp. since it bought the former GM assembly plant in Lordstown, OH and expects to hire many of the auto workers who lost their jobs when the plant closed.

Collectively, these companies estimate they will produce as many as 250,000 EV pickups per year by 2024, although some industry analysts think this is a highly ambitious goal and 70,000 per year may be a more realistic expectation.

ROBOTIC CHARGING STATIONS MAY SOLVE MAJOR ELECTRIC VEHICLE CHALLENGEAlthough transformative transportation technologies, such as electric vehicles (EVs) and autonomous vehicles (AVs), may still seem like some future innovations, many companies are working on various aspects of these technologies to overcome their common challenges.

The process of charging an electric vehicle has been one of those challenges. To date, charging would either occur at home or at a charging station, conveniently located similar to a gas pump. Many are concerned about the time it will take to charge an EV, especially on the road, as consumers will expect the process to require no more time than to fill a tank with gasoline.

Volkswagen may have solved this problem, or at least presented the world with a possible solution: an autonomous EV charging robot. It is approximately half the size of a gas pump and comes to an EV instead of requiring the EV owner to drive to a charging station.

Parking garages, large companies and even the parking lots at a shopping mall, amusement park or sports facility could employ a number of these robots to roam among the cars to charge those that request some juice.

ROAD SIGNS

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RANK AUTO BRAND DECEMBER 2019

% CHANGE FROM DECEMBER 2018 2019 YEAR TO DATE % CHANGE FROM 2018

YEAR TO DATE

#1 Ford 209,386 +0.6% 2,293,984 -3.7%

#2 Chevrolet 190,798 -4.9% 1,958,925 -3.8%

#3 Toyota 172,047 -7.2% 2,085,234 -2.0%

#4 Honda 120,433 -12.9% 1,450,785 +0.3%

#5 Nissan 93,538 -28.4% 1,227,973 -8.7%

#6 Jeep 74,653 -7.2% 923,291 -5.1%

#7 Ram 73,098 +7.2% 703,023 +17.7%

#8 Hyundai 64,720 -0.6% 688,771 +3.2%

#9 Subaru 62,364 -3.4% 700,117 +2.9%

#10 GMC 58,365 -5.4% 564,946 +1.5%

#11 Kia 51,229 +8.0% 615,338 +4.4%

#12 BMW 35,746 +4.0% 324,826 +4.4%

#13 Lexus 35,325 -0.6% 298,114 -0.1%

#14 Mercedes-Benz* 35,279 -2.4% 357,729 +1.0%

#15 Dodge 32,203 -1.0% 422,886 -7.9%

#16 Volkswagen 27,877 -13.0% 363,322 +2.6%

#17 Mazda 26,491 +2.4% 278,552 -7.3%

#18 Audi 25,850 +13.6% 224,111 +0.4%

#19 Tesla 18,600 -7.0% 223,200 +34.5%

#20 Acura 16,133 -3.8% 157,385 -1.0%

#21 Buick 16,069 -10.9% 206,929 0.0%

#22 Cadillac 15,478 -7.6% 156,246 +1.0%

#23 Chrysler 13,887 +11.8% 126,971 -23.5%

#24 Lincoln 12,994 +12.7% 112,204 +8.3%

#25 Volvo 12,360 +40.0% 108,234 +10.1%

#26 Infiniti 11,243 -37.8% 117,708 -21.2%

#27 Land Rover 10,490 -1.2% 94,736 +2.8%

#28 Mitsubishi 9,915 +10.3% 121,046 +2.5%

#29 Porsche 4,733 +15.8% 61,568 +7.6%

#30 Jaguar 3,311 -4.4% 31,051 +1.9%

#31 Mini 2,310 -17.4% 36,092 -17.4%

MONTHLY AUTOMOBILE SALES CHARTNOTE: General Motors, Ford, Fiat Chrysler Automobiles (FCA) and Tesla announced their light-vehicle sales for Q4 2019. Their brands are included in this month’s sales table and reflect actual sales.

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Source: Automotive News, January 2020* Includes Mercedes-Benz vans† Includes Aston Martin, Ferrari and Lotus estimates‡ Includes Audi, Bentley, Porsche and Volkswagen brands, but not Lamborghini§ Automotive News estimatesAutomotive News has stopped listing Smart sales© 2020 Media Group Online, Inc. All rights reserved.

Media Village Website:https://www.mediavillage.com/article/effectvs-automotive-advisory-council-highlights-three-major-trends-for-2020/?utm_source=Effectv%27s+Automotive+Advisory+Council+Highlights+Three+Major+Trends+for+2020&utm_medium=email&utm_campaign=nl-daily

Reputation.com Website:https://d24wdr9t5wf9v7.cloudfront.net/wp-content/uploads/2019/08/2019_Auto_Reputation_Report_0818.pdf?x86073

Cision (PR Newswire) Website:https://www.prnewswire.com/news-releases/lack-of-confidence-continues-to-weigh-on-car-shoppers-300962901.html?tc=eml_cleartime

Automotive News Website:https://www.autonews.com/fi-blog/prequalified-or-preapproved-confusion-online-slows-process-store

https://www.autonews.com/sales/eight-electric-pickup-truck-manufacturers-load-us-market-2021

https://www.autonews.com/sales/us-sales-slip-52-dec-saar-dips-below-17m

CNET Website:https://www.cnet.com/roadshow/news/volkswagen-electric-car-charging-robots-autonomous/

RANK AUTO BRAND DECEMBER 2019

% CHANGE FROM DECEMBER 2018 2019 YEAR TO DATE % CHANGE FROM 2018

YEAR TO DATE

#32 Genesis 2,225 +262.4% 21,233 +105.9%

#33 Maserati 925 -2.0% 11,100 -0.9%

#34 Fiat 467 -52.5% 9,200 -40.7%

#35 Lamborghini§ 232 +16.0% 2,784 +74.5%

#36 McLaren§ 180 +52.5% 2,286 +67.1%

#37 Bentley§ 169 -2.9% 2,028 -2.0%

#38 Rolls-Royce§ 110 +1.9% 1,320 +1.9%

#39 Other† 328 +2.2% 3,936 +2.2%

General Motors Corporation

280,710 -5.5% 2,887,046 -2.3%

Ford Motor Company 222,380 +1.3% 2,406,188 -3.2%

Toyota Motor Corporation

207,372 -6.1% 2,383,348 -1.8%

Fiat Chrysler Automobiles

197,143 -0.2% 2,214,763 -1.4%

American Honda Motor Company

136,566 -12.0% 1,608,170 +0.2%

Hyundai-Kia Automotive Group

118,174 +4.4% 1,325,342 +4.6%

Nissan Motor Company/Infiniti /

Mitsubishi114,696 -27.3% 1,466,727 -9.0%

Volkswagen Group‡ 58,861 -0.7% 653,813 +2.4%

BMW Group 38,166 +2.4% 362,238 +1.8%

Mercedes-Benz USA 35,279 -2.7% 358,409 +0.8%

Jaguar/Land Rover 13,801 -2.0% 125,787 +2.6%

TOTAL 1,543,471 -5.2% 17,108,156 -1.2%

the industry drags itself across the 17-million mark again...us auto industry was able to achieve a...

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