alternative fuel vehicles:

Mid-Year Review of Fuel Price Impact on American Drivers

0

Fuel Price Impact on American Drivers Has Changed

Every two months, AutoPacific surveys drivers to determine the fuel price impact on their lives, their driving styles and their consideration for vehicle types in the future.  The fuel price impact today is dramatically different from the surprise price spike to $4.15 per gallon in June 2008.  Drivers reacted dramatically.  They abandoned large SUVs and bought high fuel economy small cars and hybrids instead.  Hybrid consideration peaked at 29% in September 2008.

Drivers took huge financial losses getting rid of their gas guzzlers, but they quickly rued that decision.  By December 2008 the price of gasoline had dropped to $1.67 per gallon.  (The value of $1.67 in 2008 is $1.94 in today’s dollars).  This began a roller coaster ride of gas prices.  By January 2011, gas prices had risen to over $3 per gallon and stayed there until December 2014.  Today, the national price of a gallon of gasoline is about $2.50.

American Driver Know Fuel Prices Will Change  The result is that American drivers do not trust the stability of gasoline prices.  In 2008, fuel price was among the top ten attributes people considered important when they bought a new car.  Now, fuel price is twentieth.  In fact, fuel price is considered less important now than power and acceleration and fun to drive.

At the last peak in 2011, almost 60% said gas prices had a (negative) impact on their standard of living.  Today, that number has halved to 30%.  More people are feeling they can afford a more expensive, less fuel efficient vehicle.  Of course, longer financing terms and increases in leasing also has stimulated their buying behavior.

Honda CR-V Top Selling Crossover SUV

Cars Losing, Crossover SUVs Winning  Consequently, trucks rule. Based on the results of the Fuel Price Impact Survey, consideration for cars has been steadily slipping since 2005. In December 2005, 67% of drivers would consider a car next time they bought.  In 2017, that number has fallen to  49%.  The vehicle segment with the strongest consideration is, surprise, SUVs and Crossover SUVs with 37% of drivers saying they would consider one next time they buy.  That is up from 21% in 2005.  Mid-Size Car consideration has dropped from 27% in 2005 to 12% today.  Hybrid, the fuel efficiency darling, has fallen from 29% consideration in 2008 to 13% today.

This change in vehicle type consideration has caught some automakers by surprise.  Hyundai is a notable example where sales are off substantially.  They simply don’t have enough SUVs to sell even though they have added extra capacity for the Hyundai Santa Fe Sport to their plant in Alabama.  Like Porsche when that German brand added the Cayenne SUV, Jaguar has seen its sales double after adding the F-Pace SUV to their lineup.

Regulations Forcing Automakers to Produce Vehicles That May Be Tough to Sell  Even though fuel price is lower on the importance list and buyers are flocking to Crossover SUVs, more and more hybrids and electric vehicles are being introduced every year.  The introduction of these new fuel efficient cars and trucks has been to meet the stringent government fuel economy regulations established by the Obama Administration.  As good and as fuel efficient as these new vehicles are, they will need a marketing push to sell them.  Automakers cannot expect “consumer pull” to get these vehicles on the road.  With the price of fuel staying relatively low, American new vehicle buyers are going to buy what they want.  This means continuing popularity for Crossover SUVs at the expense of Mid-Size Cars and Small Cars.

Potential changes to fuel economy regulations will impact how the auto industry reacts, but stopping or slowing the surge of hybrids, plug-in hybrids and electric vehicles is not in the cards.  Too many sunk costs and resources already.


Continue Reading

Volt Wins Among Today’s Hybrids and EVs

0

Two new, completely different high efficiency cars entered the American car market earlier this year – the Nissan Leaf and Chevrolet Volt – and AutoPacific set out to find out how different the owners of those cars were from owners of hybrid cars like the Toyota Prius and Honda Insight.  We also are looking at how satisfied buyers are with the cars and what they would like changed.

Think of these four cars as being purpose-built for their technology.  They did not simply adapt their new powertrain technology to an existing vehicle such as the Ford Fusion Hybrid or the Toyota Highlander Hybrid.  The Chevrolet Volt is an Extended Range Electric Vehicle.  The Nissan Leaf is a pure Battery Electric Vehicle.  And the Toyota Prius and Honda Insight are pure Hybrids.

Based on AutoPacific’s annual New Vehicle Satisfaction Survey which has a total of almost 73,000 new car and light truck owner responses to a comprehensive questionnaire about the car buying and ownership experience, the comparison finds some interesting and insightful results.

Leaf and Volt Owners are Dramatically Different from Prius and Insight Owners: Volt owners paid $43,000 for their new car.  Leaf owners paid $34,500.  Prius and Insight owners paid $25,000 and $21,000 respectively.  Given the price points, Volt and Leaf owners are the most affluent with incomes of $150,000.  Prius owners have an income of $100,000 and Insight owners have an income of $80,000.

Leaf and Volt owners are much more likely to be male and much more into the technology of their new car.  They are very similar to early buyers of hybrids who were enamored with the new innovative technology of their vehicle.  The Leaf and Insight owners are the youngest of the group at 53 and 54 years of age respectively.  Owners of the much more expensive Volt are 58 as are owners of the Prius.

Leaf owners have the highest level of education.  About 90% have a college education.  About 70% of Volt, Insight and Prius owners have a college education.  Leaf owners are much more likely to be retired (almost 50%).  Only 17% of Insight owners are retired.  About a third of Leaf owners are in a technical profession as are 20% of Volt owners.

Leaf owners are most likely (24%) to have owned a hybrid before.  Prius owners are almost as likely to have owned a hybrid (23%) as Leaf owners.  Volt (8%) and Insight (8%) owners are newcomers to the world of alternative fuel vehicles.  Volt owners are most likely to have previously driven a compact car (18%) or mid-size car (14%), Insight owners were most likely to have previously driven a compact car (23%) or a mid-size car (23%).

Satisfaction – Volt Wins: About 86% of Volt owners are very satisfied with their vehicles compared with 80% of Leaf owners, 70% of Prius owners and 54% of Insight owners.  Among these four cars, Volt owners are most satisfied by a substantial margin.  Leaf and Prius owners are about equally satisfied.  Insight owners are the least satisfied among the four cars.  Out of 48 satisfaction categories in the research,  Volt owners are the most satisfied in 38 of the categories… an overwhelming win.


Continue Reading

Follow VehicleVoice

RSS Feed   Facebook   Twitter

Membership

Join

Recent Winners

Sid P., Washington - $100
Ken G., Nevada - $100
Brad T., Wisconsin - $100
Tom M., Virginia - $100
Kathy F., New Jersey - $100
John M., Massachusetts - $100
Mike M., California - $100
Carol R., Texas - $100
James D., Georgia - $100
Martha B., New Jersey - $100
Kerry B., Pennsylvania - $100

What is VehicleVoice?

About Vehicle Voice