Thursday, September 27, 2012

Interview: Generational Differences Among Car Buyers

I recently interviewed Jeff Campana who is Sr. Vice President of GfK Automotive. Jeff has more than 26 years' experience in automotive marketing research and consulting. Before joining GfK in 1997 he spent 10 years at General Motors. GfK Automotive conducts research for the global automotive industry.

"New GfK research shows that Generations X & Y represent 63% of new vehicle "intenders"- those who plan to buy a car in the next 12 months"

"Exciting" is #7 for Gen Y, versus #21 for Boomers; and "Technologically Advanced Features" ranks at #12 for Gen Y compared to #22 for Boomers"

"Looking just at small cars, the GfK study found that 29% of Gen Y consumers are small car intenders, versus 19% of Generation X and 19% of Baby Boomers.

My interview with Jeff Campana focused on generational differences among car buyers. Check out the interview below:

When it comes to car buying what differentiates Gen X & Y from Baby Boomers?

What we saw is that Gen X & Y are still interested in buying cars. Just like Baby Boomers they still want quality and value. We thought they placed a higher priority on safety and technology, not on price. Gen X & Y want to have those technology devices in their vehicles. Another interesting thing we saw despite fuel prices over the past two years their demand isn't just based on fuel economy.

Why do you think interest in small cars has increased across the board?

It is not a bare bones car. Based off of our research the compact car segment demand is strong. Gen X & Y felt subcompacts were not acceptable to them. The compact car segment is a decent size and good compromise for them. They are not trying to go for the small and cheapest car but something that is in their price range.

It's obvious that technology in vehicles are important to Gen X & Y. But does the price of these added features turn away the buyers?

You have to be careful. They still have a price point they want to hit. Car companies need to offer technology innovations at reasonable prices. What we see is that Gen X & Y buyers like to have the latest technology in their vehicles. Luxury car buyers want the new technology because of status. For Gen X & Y buyers, the benefit has to be clear to them. These buyers are not car people. These Gen X & Y buyers are not hardcore car enthusiast. It is important to have technology that is easy to understand.

What vehicles are attracting Gen Y and X? Midsize sedans? Crossovers?

What we see in our data is that the midsize sedan category is the largest segment. When you look at Gen X and Y it is still a segment that is of high demand. Gen X has an interest in both the compact and midsize sedan categories. The midsize sedan category for Gen Y is the number two segment of interest for them. It is a case bsaed on the price point trade off. Gen X has more of an interest in crossovers than Gen Y. The crossover segment is the number three segment right now. We've seen that buyers who look at small cars also look at small crossovers.

Is driving as important to Gen X & Y as it was to Baby Boomers?

I've seen a lot of articles about whether driving a car is important to younger people. Those buyers are interested in fun to drive and exciting vehicles. The demise of the car among young people is misstated. It is still subject to debate about whether or not cars are as important as they once were. We've asked people to prioritize purchases, and noticed that cell phones and computers are rated more important than cars. But cars are still important to young people.

Based off of car sales I would say that younger car shoppers are focused on excellent gas mileage. Is this true?

We do see that people are looking at fuel economy. A lot of manufacturers are offering better fuel economy. A lot of people are gravitated towards those vehicles. Once people focus in on which segment they want to buy in the reason for buying a car is economic rather than environmental. The movement for hybrids was based more on pocket book issues. I think manufacturers are being smart about producing higher fuel efficient vehicles.

What are your thoughts on the semi-luxury category? Acura ILX & Buick Verano?

I am glad you asked that question. We do see interest in that market around younger people. If manufacturers move down to a lower price point do people still feel it is true to the brand? Some of the luxury manufacturers are bringing the cars they build in Europe over here. In order for Gen X & Y to pay that higher price they have to believe that it is true to the luxury brand name. If I pay more for a luxury brand it has to be a better overall car compared to the non-luxury brand. Buyers ask "Is it the same thing I can get with a midsize car?", "In terms of performance and quality of materials does it still feel like a luxury car to me?". Gen X seems to have more of an interest in luxury cars.

Is having AWD a factor when it comes to buying a car among Gen X & Y?

These buyers are not big car enthusiasts. Is it something that is important? To be honest we haven't really seen it as a purchase motivator. AWD techonology is offered and. It might appeal to them. There is a big price step-up that some people aren't willing to make that trade-off. For most manufacturers its been a huge price difference compared to a non-AWD model. The price of choosing AWD has to come for it to catch on with Gen X & Y. If the AWD trend continues from the higher segments to the smaller segments it would help create demand for cheaper systems. I agree that there is a performance aspect to choosing a vehicle with AWD. But fuel economy has the biggest impact on whether a person buys a vehicle with an AWD system. Having AWD does affect the car a lot in terms of fuel conomy, weight, and handling. Subaru has done an excellent job at offering vehicles with AWD systems at a reasonable price and that have good fuel economy.

I want to thank David Stanton for setting up this interview. I also want to thank Jeff Campana for taking the time to answer my questions and chat with me about the auto industry.

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Tuesday, September 18, 2012

2013 Ford Fusion Lineup MPG Figures

Ford has announced that the 2013 Fusion Hybrid will have an mpg of 47 in the city and 47 on the highway. The Fusion Hybrid will use a 2.0L inline-four engine producing 141 hp and a electric motor producing 118 hp. Fusion's equipped with the 2.5L inline-four producing 175 hp will return 22 city and 34 hwy. Customers that opt for the 1.6L EcoBoost turbo four producing 178 hp will return 25 city and 37 hwy. The big 2.0L EcoBoost turbo-four producing 240 hp will return 22 city and 33 hwy. The 2013 Ford Fusion starts at $22,495 and will be available this fall.

The Green Light: Ford has really done a great job with the new Fusion so far. The new Ford Fusion has to be one of the best looking midsize sedans and with it's impressive fuel economy I'm sure it will sell well. The biggest achievement for the Fusion is the Hybrid model which returns 47c/47hwy. These mpg figures definitely beat out the current competitions Hybrid models. I can't wait for the figures of the new Honda Accord Hybrid and Nissan Altima Hybrid to see how well they stack up to the new Ford Fusion Hybrid. Overall I think that midsize sedan market is more competitive than it has ever been. Ford has a hit on it's hands with the new Ford Fusion.

Are you more compelled to buy a Ford Fusion over the competition?

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Early Reveal: 2013 Mazda CX-9

Mazda's "smiley face" design is finally leaving it's current lineup! The 7 passenger seat CX-9 now receives the new KODO design. The '13 Mazda CX-9 will makes it debut at the Australian International Motor Show next month. The only detail released about the new CX-9 is that the 3.7 V6 engine and 6-speed automatic transmission will be carried over. More details should be released when the '13 CX-9 is revealed in October.

The Green Light: I think that Mazda is doing a great job with their new designs. The 2013 CX-9 is beautiful and to me is one of the best looking 7 seat CUVs. The front of the CX-9 looks very similar to it's siblings the CX-5 and Mazda6. The side profile of the vehicle reminds me of the current CX-9 as well as the Infiniti JX35. I definitely get a luxury feel from the new CX-9 which is not a bad thing. While the exterior is quite attractive I want to see what the interior looks like. Mazda is slowly becoming one of my favorite automakers when it comes to designs.

Do you like the look of the 2013 Mazda CX-9?

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Tuesday, September 11, 2012

Nissan Innovation Garage

 The Nissan Innovation Garage, is a unique opportunity that invites people to submit innovative ideas for a chance to win a $50,000 grant, a 2013 Altima, and help unleashing their winning ideas on Kickstarter. Check out the introductory video:

Here’s how the Nissan Innovation Garage works:

  • Visit the Innovation Garage microsite at and finish the statement, "Wouldn't it be cool if..." The microsite provides an immersive experience that uses Facebook Connect to pull information from your profile, including photos, to generate a custom video that re-imagines what the world would be like if you were behind the greatest innovation ever.

  • Two innovators' submissions will be chosen by Nissan's panel of engineers for a $50,000 grant, a 2013 Altima, and help unleashing their winning ideas on Kickstarter, the world's largest funding platform for creative projects. Winners will also be featured on The Daily Brink, an online publication that showcases innovative minds with uncommon drive and passion. The fan favorite entry (decided by votes) also wins a new 2013 Altima, Nissan's most innovative Altima yet. 

  • Nissan is a company of innovators who want to facilitate further innovation in all categories, not just automotive. Through the Innovation Garage, Nissan is embracing the idea that everyone is an innovator, they just need the right tool to take their everyday idea and run with it. 
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Monday, September 10, 2012

2013 Honda Accord

The Honda Accord has been "redesigned" for the 2013 model year. The 2013 Honda Accord receives an updated design, new set of transmissions, and engine choices. The 2013 Accord competes against the redesigned Nissan Altima, Toyota Camry, Kia Optima, Hyundai Sonata, VW Passat, Chrysler 200, Dodge Avenger, and the soon to be released Ford Fusion and Mazda6.

Two engines are offered on this generation Accord: a direct-injection 2.4L I-4 and a 3.5L V6. The 2.4L I-4 makes 189 hp and is mated to a 6-speed manual or CVT. The 3.5L V6 makes 278 hp and 252 lb-ft of torque and is mated to a 6-speed automatic transmission. The 2.4L engine when mated to a manual achieves 24 mpg city and 34 hwy. The same engine when mated to the new CVT achieves 27 city and 36 hwy. The 3.5L V6 engine achieves 21 city and 34 hwy with the 6-speed automatic.

The 2013 Honda Accord will come in many variations to satisfy buyer's needs. Those variations include a sedan, coupe, hybrid, and plug-in hybrid. The base model Accord starts at $22,470, including a $790 destination charge. Buyers who want the V6 engine will have to shell out $30,860. The 2013 Accord sedan will go on sale later this month while the coupe will go on sale in October.

The Green Light: I will say that I am not a fan of the new design, I really expected to see something revolutionary. While this generation model to me is bland, it does look better than the outgoing model. I can definitely see styling cues from the last generation Acura TL. The last Honda Accord I was in was a 2005 model which I really enjoyed. I am used to CVT transmissions so it doesn't bother me that Honda has decided to use one. I really want to get behind the wheel of one to see how well it competes against Nissan's new Xtronic CVT transmission.

How do you feel about the 2013 Honda Accord?

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