SUV/CUV Owners Drive Automotive Loyalty Rates, IHS Says
By Business Wire News
By Business Wire News
Loyalty among SUV/CUV owners in the United States has soared to record levels, according to recent analysis from business information provider IHS Automotive, part of IHS Inc. (NYSE: IHS). Sixty-three percent of SUV/CUV owners who returned to market for a new vehicle during the first quarter of 2016 purchased another SUV or CUV, figures gleaned from the analysis of more than 1.9 million return to market events during the quarter. Comparatively, loyalty rates among sedan owners were just 53 percent in the same timeframe, just slightly ahead of the industry average of 52.1 percent for the quarter, a trend that has continued to increase over time.
The heightened appeal of crossovers and SUVs has propelled vehicle manufacturers to greatly expand their product offerings in this category, which in turn has increased consumer demand even further. The number of CUVs and SUVs in dealer showrooms has climbed, including a greater number of sub-compact crossovers from mainstream as well as luxury brands. Manufacturers are also offering multiple products in the same size category to cater to both the off-road and the more leisurely buyer. The increase in product offerings extends to the powertrain, seating configurations, and safety, infotainment, connectivity, and convenience technologies as well. In addition, relatively low gas prices have shifted demand towards utility and off-roading capabilities and away from fuel economy that is often associated with cars.
Among 32 segments that IHS Automotive analyzed, the three segments with the greatest increase in loyalty to body style are CUVs; and of the 32, the eight with the highest propensity to re-purchase the same body style are in the SUV or CUV category. Luxury full-size SUV owners have the highest propensity to purchase another vehicle within the SUV/CUV body style – with 70.3 percent body style loyalty during the first quarter.
“We continue to see the SUV/CUV segment reaching record registration volumes in the U.S. market,” said Tom Libby, manager, loyalty and industry analysis with IHS Automotive. “New designs and OEM marketing initiatives focused on capturing repeat buyers are helping this segment continue its substantial growth,” he said.
New vehicle registration trends also continue toward SUVs/CUVs; forecast reflects additional growth
Personal registrations of SUVs and CUVs continue to outpace registrations of cars at record levels. During the first quarter 2011, SUVs and CUVs comprised just 35.2 percent of personal new vehicle registrations, according to IHS Automotive, while during the first quarter of 2016, the combined body style grew to 41.8 percent share of the market. Meanwhile, cars represented 48.7 percent of new vehicle registrations during the first quarter of 2011, and just 40.9 percent in the same timeframe in 2016.
Forecasts from IHS Automotive also reflect continued growth among SUVs and CUVs in the marketplace through the forecast horizon.
“The high loyalty rates for SUVs and CUVs lend credence to the current shift from passenger cars to utility vehicles,” said Christopher Hopson, manager, North America light vehicle sales forecast at IHS Automotive. “We expect this shift to be sustained, even when fuel prices are expected to rise back above USD $3.00/gallon by 2020.”
About IHS Automotive(www.ihs.com/automotive)
IHS Automotive, part of IHS Inc. (NYSE: IHS), offers clients the most comprehensive content and deepest expertise and insight on the automotive industry available anywhere in the world today. With the 2013 addition of Polk, IHS Automotive now provides expertise and predictive insight across the entire automotive value chain from product inception—across design and production—to the sales and marketing efforts used to maximize potential in the marketplace. No other source provides a more complete picture of the global automotive industry. IHS is the leading source of information, insight and analytics in critical areas that shape today’s business landscape. IHS has been in business since 1959 and became a publicly traded company on the New York Stock Exchange in 2005. Headquartered in Englewood, Colorado, USA, IHS is committed to sustainable, profitable growth and employs nearly 9,000 people in 33 countries around the world.
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