Detroit seen seeking to woo back buyers with iconic models
MSNBC.com - Jan 8, 2007
WASHINGTON - Americans have a bias against cars made by U.S. automakers, but an AP-AOL Autos poll found flickers of loyalty that could offer hope for an industry struggling to survive.
The problem for Detroit is changing perceptions that often don’t match reality.
Those questioned in the survey said they have more faith in Japanese-made cars than in vehicles produced by Detroit’s Big Three. But General Motors Corp., Ford Motor Co. and the Chrysler Group are going back to the future in their uphill effort to again inspire consumer loyalty and regain market share.
What is the American auto industry doing to reclaim its evaporating support?
The industry is returning to the types of autos that gave it a sense of “swagger and attitude in the 1960s,” said John Wolkonowicz, an auto industry analyst. Many of those cars will be on display in Detroit over the next two weeks during the North American International Auto Show.
And the mood of U.S. auto industry leaders?
“They’re tearing their hair out,” said Wolkonowicz, who works at Global Insight, an economic research and consulting company. “It’s more of a problem of perception than reality. The problem started in the late 1960s and early 1970s.”
Back then, a teenager’s first set of wheels probably was something like a 10-year-old American-made car, with all the attendant problems. The replacement might have been a new Japanese compact, a more reliable performer with better gas mileage.
As the Japanese began offering luxury models, that brand loyalty grew stronger. Also, European-made cars became more popular as consumers looked to drive something distinct from their parents’ vehicles.
In the poll, 44 percent said Japan makes the best autos, 29 percent said the United States and 15 percent said Germany. Asked what car manufacturer makes the best autos, 25 percent said Toyota, 21 percent said General Motors and 17 percent said Honda.
“The best cars are made in Japan or maybe a BMW from Germany,” said Pat Goeglein, 51, who lives near Los Angeles and works in real estate. “Those cars last forever. I have to get economy out of my cars.”
While the public perceives that Japan makes the best cars, several poll findings could offer encouragement for U.S. automakers.
- Only 17 percent of current or potential car owners in the poll say they prefer to buy foreign cars. Also, 39 percent said they prefer to buy American cars and 44 percent said it makes no difference.
- Support for buying American cars increases with age, but six in 10 of those 30 or younger said they were open to buying foreign cars or American cars. That suggests they may be receptive to efforts of American automakers to win them over.
- Eighty-five percent of foreign car owners said they were very satisfied with their cars, while eight in 10 owners of American cars were very satisfied.
Auto industry analysts say many people have the perception that cars made overseas are built better than American cars. But the performance of American-made cars is now actually very close to those made in Japan and higher than many cars made in Europe, they said. Foreign cars do have an advantage in resale value, however.
The domestic industry is trying to bring consumers into showrooms to look for something other than trucks, offering traditional cars like the Ford Mustang and introducing muscular new models of the Chevy Malibu and a concept car that could serve as a replacement for the popular Chrysler 300.
American automakers got off to a good start this year when the Saturn Aura and Chevrolet Silverado, both General Motors Corp. products, were chosen as the 2007 car and truck of the year at the North American International Auto Show over the weekend.
For the past decade or so, American automakers have tried to win back car buyers who purchase gas-efficient imports, industry analysts said, but that effort has met with limited success.
American models are getting more gas-efficient, analysts say, and prices for regular gas have dipped from their average $3-per-gallon price last summer.
But the biggest audience for American-made cars and trucks may be the blue-collar population, analysts said.
The poll found that 51 percent of those with a high school education or less preferred American-made motor vehicles, while 31 percent with a college degree felt that way. Younger people and those with less education were also most interested in more traditional or “retro” cars.
The share of autos sold in the U.S. by the Big Three has dropped sharply in recent years. General Motors and Ford have cut their labor force and related costs to be more competitive, and the Chrysler Group of Daimler Chrysler is likely to make similar moves.
George Maglione, an auto industry analyst, said the Big Three’s share of the market has dropped from seven in 10 sold in 1998 to just over half sold in 2006.
That dropping share has accelerated as older people, the generation most loyal to American cars, have aged and left the buying market.
That has made it critical that American automakers win over young adults, who are just starting to build their loyalties.
Leticia Bowlin, a 29-year-old mother from Sanford, Fla., said she makes her choice on what car to make based on its ratings and safety features.
“I don’t have a preference based on the country,” she said.
Features such as side air bags and antilock braking systems were the options people most wanted, while onboard navigation systems interested them the most, according to the telephone poll of 1,004 adults conducted Dec. 19-21. The margin of sampling error was plus or minus 3 percentage points.