A new survey from AutoMD.com indicates that the lengthening vehicle ownership cycle is impacting vehicle purchasing.
The survey, conducted online among over 1,000 vehicle owners, 59% of whom said they planned to purchase within six months, reveals that the majority are opting for a pre-owned vehicle, with three quarters saying that their purchase decision would be influenced by the cost of replacement parts.
And, while price trumped every other purchase decision factor, knowing a vehicle will last ten years was the second most important influencer. In addition, these consumers want a good deal, with the majority defining a good deal as at or below invoice pricing – and they are opting for third party research sites and Google, not dealership websites, to make sure they get that deal.
“At AutoMD.com, we have been reporting for years* on the lengthening vehicle ownership cycle. This survey indicates how that extended vehicle lifecycle is impacting consumer vehicle purchase decisions,” said Tracey Virtue, vice president of AutoMD.com. “Clearly many consumers embrace the notion of a pre-owned vehicle as a viable primary vehicle, and are looking to keep them running for the long term.”
Pre-owned Vehicles Rule – Only One in Four Plan to Buy New
When asked what kind of vehicle they would purchase for their next primary vehicle, only one in four say they plan to buy new; but 76% will purchase a pre-owned vehicle, and over half (55%) are opting for a vehicle that is more than two years old.
And, confirming the lengthening buy cycle, 32% say their current primary vehicle is six years or older with 12% reporting that they are driving a vehicle that is over 10 years old.
Replacement Parts Key Consideration – Keeping That Vehicle Running for the Long Term
Seventy-four percent reported that replacement parts would be a consideration when purchasing their next vehicle. Interestingly, of those who said it was not a consideration, over half said it was because it either did not occur to them or that they did not know where to look for that information. For the rest, style/brand trumped replacement parts cost.
Vehicle Price Top Influencer, but Longevity Close Behind
Not surprisingly, when asked what would influence their vehicle decision most, price came first, but knowing that the car would last for ten years was number two.
The majority of respondents said that they would be looking for a vehicle that was about the same, or less than, the price of their current vehicle, although over one third were willing to pay more. And, they are looking for a good deal, with 62% saying they define a ‘good deal’ as being at or below invoice pricing.
Electric/Hybrids Not High on the Vehicle Shopping List, but Brand Loyalty, Ford, Chevrolet and Toyota Are
The good news for automakers is that, although most of these consumers are focused on pre-owned purchases, nearly half said they were likely to purchase the same brand as their current vehicle, with 29% reporting they would choose a different brand. Only 11% were interested in a hybrid or electric vehicle, reflecting how low on the list of top purchase influences fuel efficiency ranked. When asked specifically what brand they would pick, Ford was chosen by the largest number, followed by Chevrolet and Toyota.
Third Party Research and Google Driving Vehicle Information, Dealership Sites Rank Low
Third party research sites such as Edmunds and Kelley Blue Book were ranked as the most valuable online resources when making a vehicle purchase decision. Google tied with third party buying sites such as AutoTrader and TrueCar as second most valuable. Auto dealership websites ranked second to last in value.