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Car Buyers Are Thinking American

But not all brands are equal

By James Limbach
ConsumerAffairs.com

September 3, 2009
"Buy American" is resonating strongly with new car shoppers. A nationally representative survey by Consumer Reports finds 81 percent of those looking to buy a new car are likely to consider a domestic brand.

The interest in buying American was significantly higher than the percentage of new car shoppers considering Asian (47 percent) and European (46 percent) models.

Those who were asked, however, did not view all domestic brands the same. Ford has benefited the most from the recent turmoil in the auto market, with the largest gain in new-car buyers who say that they are likely to consider buying a Ford model -- up 17 percentage points compared with a year ago.

Those considering buying a GM model were up six percentage points, but those considering a Chrysler model were down 25 percentage points among new-car buyers and 28 percentage points among all respondents.

With relatively few new models in the short-term pipeline, it may be some time before the restructured Chrysler can improve on the attributes that now matter most to consumers.

"The Detroit 3 have been in the spotlight all year," said Rik Paul, automotive editor, Consumer Reports. "Ford was the only one of the Detroit 3 that did not seek federal assistance, and this has likely helped bolster its reputation among car buyers."

Only nine percent of those interviewed are likely to buy a car in the next year. That's less than half of the percentage (19 percent) of new-car buyers in a June 2008 survey, suggesting that the market may not rebound for some time. Overall, four in ten consumers said they have put off purchasing a new vehicle -- a percentage that reflects the national sales decrease. Among those considering a purchase, 61 percent are looking specifically to buy a used car.

Among those who said that they were less likely to consider buying a model from a Detroit automaker, the top reasons for Chrysler and Ford were that the company's products aren't appealing.

By contrast, the leading reasons for not considering a GM model were concern about the company's future and the economic condition of the company, even though GM had emerged from bankruptcy weeks prior to the survey.

The most important factors to consumers

For most, the most important consideration in deciding which vehicle to buy is price, followed by fuel economy, safety, and quality. But among active new-car buyers, fuel economy was the most important factor, with quality and safety also rising above price. These are considerably more important than brand, styling, an automaker's stability or incentives.

In these lean times, however, automakers are becoming increasingly creative in addressing the age-old question, "What can I do to sell you this car today?" With a broad range of offers available, new-car shoppers who consider manufacturer incentives important to their choice of vehicle cite a long warranty, discounted price, and low interest rate as most influential to their purchase decision. These are considered more important than cash rebates or programs involving a "job-loss protection" promotion and free or discounted gasoline.

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