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Car Makers Face an Increasingly Bumpy Road

Car Makers Face an Increasingly Bumpy Road

Cars have long been a key part of the American way of life, but that seems to be fading. According to two recent surveys, consumers today are less satisfied with their cars, and they're also driving less. "I think we have just reached a cultural point where people are less enamored with driving around in their cars," said Phineas Baxandall of the U.S. PIRG Education Fund.

By Erika Morphy CRM Buyer ECT News Network
08/30/13 5:00 AM PT

There is something odd happening between Americans and their usually intense love relationships with their cars. One survey points to a slight, but still worrisome, drop in customer satisfaction with vehicles and light trucks this past year; another shows that Americans are driving less -- much less in some cases.

Is there any overlap? That is, are Americans driving less because of their growing dissatisfaction with their vehicles? Well, no.

What these surveys do suggest, though, is that Americans are no longer as dependent on their cars as they used to be -- and any dissatisfaction with said vehicles will register and resonate that much louder with consumers.

'Still a High Number'

To be fair, consumer satisfaction with car and light truck brands is still good, according to the first survey -- the American Customer Satisfaction Index quarterly update on customer satisfaction for automobiles. In this recent report, customer satisfaction with automobiles and light vehicles declined by 1.2 percent -- following back-to-back years of improvement -- to an ACSI benchmark of 83.

"Even after this drop it is important to note that 83 is still a high number -- it still indicates a high level of satisfaction," Forrest Morgeson, ACSI director of research, told CRM Buyer. "We are not in a situation where there has been a deterioration of satisfaction to the point where satisfaction is now very low. Eighty-three is a very good score."

Nonetheless, the drop says something about consumers' perceptions of car quality -- especially considering that the dissatisfaction is spread among both domestic and foreign manufacturers.

The survey revealed that over the past year, three of nine Japanese and Korean brands and two of three European brands dropped, with Hyundai and BMW showing the largest decreases. Customer satisfaction also deteriorated for five of eight domestic brands, with sizable downturns for Chevrolet and Buick. Overall, only 26 percent of the individual brands improved, while 53 percent declined and 21 percent remain unchanged.

Drivers Wanted

As for the second part of this scenario, maybe it is just that Americans don't like driving as much as they used to. There is some credence to that theory, backed by a separate study from the U.S. PIRG Education Fund.

That research found that Americans have cut -- by double-digit percentages -- their per-person driving miles in 46 states plus Washington, D.C., since the middle of the last decade. The only states that did not see a decrease in miles driven per-person since the middle of the last decade were Alabama, Louisiana, Nevada and North Dakota.

"There doesn't seem to be a significant relationship between the economy and driving patterns," Phineas Baxandall, Transportation Program director for the U.S. PIRG Education Fund, told CRM Buyer.

That is not to say there is no impact from the economic downturn -- the economy and gas prices matter in some respects -- but this decrease in driving started in 2004 when the economy was still humming. There were also cases in which consumers in states very affected by the economy -- Nevada was devastated by the housing crisis, for example -- still kept on driving as always, he noted.

Baxandall thinks there are a number of reasons to explain the slump: Suburban living is not the be-all and end-all that it once was made out to be, for example, so people are migrating back to the cities.

Also, millennials have shown to be distinctly uninterested in owning cars.

'People Are Less Enamored'

If the Zeitgeist is indeed an anti-car one, the ACSI study and its slight decline in customer satisfaction does take on new meaning.

The people surveyed by U.S. PIRG probably were not included in the ACSI study, Morgeson noted.

"Basically, we spoke to people who actually have purchased and used a car in the last year," he noted. Still, the study doesn't capture whether they are driving less, which appears to be the salient question now.


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