Compacts Popular; Hybrids/Electrics Not So Much
For a while there, as gasoline prices moderated, it looked like people were heading back to the big crossovers and trucks. Now, it seems, that was fond farewell romance as they are back to seeking diminutive vehicles. But that doesn't mean sub-compact cars -- just compacts, according to researchers from GfK Custom Research North America's Automotive practice.
It may seem surprising at first blush that the firm also found that demand wasn't very high for hybrids and electric vehicles, but such vehicles are actually becoming a harder sell now that internal-combustion engine technology has brought traditional engine gas mileage for a lot of compact vehicles up to and beyond 40 mpg.
Hyundai, Ford, Chevrolet, Kia, Toyota and others have been aggressively talking mileage benefits in their vehicle advertising. Hyundai's "save the asterisks" ads have hammered home the message that all variants of the new Elantra compact get over 40 mpg. Chevy, for its part, took on Toyota with its "Dear Corolla" campaign, voiced by actor Tim Allen, that launched last fall. Part of Ford's multifarious global campaign for the 2012 Focus has been the car's 40 mpg rating.
GfK says that last month compact cars were 18.1% of light vehicle demand versus 3.6% for subcompact cars. Hybrids and electrics were 9.4% of light vehicle demand. The firm said alternative-power train vehicles didn't benefit because of lower familiarity, higher purchase prices, and lack of convenience.
"For the average consumer looking to purchase a new vehicle, especially during these times of rising gas prices, they see more value in smaller vehicles with traditional gas engines -- some of which approach 40 mpg -- rather than hybrids or even electric vehicles," said Doug Scott, senior vice president, consulting, GfK Automotive. But he added that people looking to save gas don't seem willing to go all the way down to a subcompact car. "Consumers are discovering that newer compact cars offer the comfort features before only reserved to larger cars, combined with the fuel economy that was only available in much smaller cars."
So how do marketers get people into hybrids and electrics, in addition to lowering the price? Scott said marketers shouldn't ignore the emotional benefits that hybrid and electric-vehicle drivers feel. "Automakers need to communicate [that] to a wider audience of potential customers," he said. "The feeling of pride associated with owning a vehicle that is environmentally friendly has resonated with consumers inclined toward 'green' behaviors." He said automakers should also communicate the tangible benefits of alternative vehicles, while also addressing the obstacles consumers face with purchasing them.