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Polk, the global automotive market intelligence outfit, recently conducted a study among US consumers that showed motorists in America are holding onto their cars and trucks for a record number of years.
Using data collected from US vehicle registrations, Polk discovered that the ownership period from when a new car was first purchased until the owner trades it in now stands at 71.4 months or almost six years. For those consumers who bought used vehicles, the ownership duration is now at an average of 49.9 months.
As to why consumers are holding onto their cars for longer, Polk cites a number of different factors. First, with the US economy still shaky and many Americans out of a job and looking for work, consumers are simply being cautious when it comes to spending. Secondly, in order to make vehicle purchases more affordable on a monthly basis, automakers and financing companies are now offering record length purchase and leasing agreements, reducing monthly payments. As a result, there’s less of an incentive to trade vehicles every three or even five years, as was customary in the past.
The findings from the Polk survey have also helped contribute to a rising average age of vehicles on American roads, which now stands at 10.8 years. This means, that it’s a good time to be in the automotive aftermarket business, as these older vehicles will require servicing and replacement parts.
According to Mark Seng, Global Aftermarket Practice leader at Polk, this rising age of vehicles also,”creates concerns about appropriate parts inventory,” an issue Polk is attempting to address by “currently working with customers in the aftermarket to help them prepare for increasing demand throughout the entire supply chain.”
For decades there was a sentiment among US vehicle buyers of avoiding home grown brands, largely because of a perceived lack of quality and reliability compared with those from overseas, especially Japanese ones.
However, perhaps as a result of this latest recession and also a growing “buy American” sentiment, that trend appears to be reversing, with record numbers of car shoppers now choosing to avoid imported nameplates because of their origin.
An annual “Avoider” survey by JD Power & Associates illustrated that the share of buyers avoiding imports increased from 9 percent in 2011 to 14 percent this year, while the percentage of buyers avoiding Domestic vehicle brands dropped to its lowest level on record; six percent.
“For many years, domestics were largely abandoned but now it’s gone back and they’re competing head on with the imports,” said Jon Osborn, research director for JD Power in reference to the findings. “They [US automakers] are meeting the demands the American consumer is producing.”
Osborn also cites clever marketing slogans, such as Chrysler’s “Imported from Detroit” as having an impact on the results, though he did say that today as has been the norm for years, many new vehicle shoppers base their opinions regarding quality on “pre-conceived notions rather than concrete information and data,” which is probably why Jaguar was labeled the most avoided brand on the list, even though, according to JD Power’s own Dependability studies, the British luxury marque has ranked consistently among the top brands in recent years.
[Source: Automotive News]