Wednesday, November 14, 2012 | Edited by Daniel Moores
||More Women Drivers Than Men on U.S. Roads Now
Women have passed men on the nation's roads.
More women than men now have driver's licenses, a reversal of a longtime gender gap behind the wheel that transportation researchers say is likely to have safety and economic implications.
If current trends continue, the gap will only widen. The share of teens and young adults of both sexes with driver's licenses is declining, but the decline is greater for young men, according to a study by the University of Michigan's Transportation Research Institute. The study looked at gender trends in driver's licenses between 1995 and 2010.
"The changing gender demographics will have major implications on the extent and nature of vehicle demand, energy consumption, and road safety," predicted Michael Sivak, co-author of the study. Women are more likely than men to purchase smaller, safer and more fuel-efficient cars; to drive less, and to have a lower fatality rate per distance driven, he said.
Over the 15 years the study covered, the share of men ages 25 to 29 years old with driver's licenses dropped 10.6 percent. The share of women of the same age with driver's licenses declined by about half that amount, 4.7 percent.
Male drivers outnumbered women drivers from the moment the first Ford Model T rolled off the assembly line in 1908, the year the automobile became popular, and through most of the last century. In the 1950s, when only about half of adult women had driver's licenses, jokes about women drivers were a staple of comedians.
But the gap gradually closed. By 1995, men with driver's licenses slightly outnumbered women, 89.2 million to 87.4 million. By 2010, 105.7 million women had licenses, compared with 104.3 million men.
Likewise, in 1995 men with driver's licenses outnumbered women in every age group except those over 70. By 2010, women outnumbered men among drivers ages 45 and older and between ages 25 and 29 years old. The share of older women who are also hanging on to their driver's licenses has also increased.
"I want to be in my own car for as long as possible. I want to be independent for as long as I can," said Diane Spitaliere, 58, a retired government worker in Alexandria, Va.
Male drivers under age 44 are still slightly more numerous than women of the same age, but that's only because young men outnumber young women in the general population, the study said. There now are 105 boys born each year for every 100 girls in the U.S. Women outnumber men later in life because they live longer -- an average of 80 years for women, compared with about 75 years for men.
Rising Internet usage may be part of the reason for the decline in the share of young drivers, especially young men, Sivak said. A previous study by the transportation institute published earlier this year found that countries that have higher Internet usage also have a lower licensure rate of teens and young adults.
"There is some suggestive evidence that Internet contact is reducing the need for personal contact," he said.
Other researchers have theorized that digital media and technology may make driving less desirable and public transportation more convenient. Texting while driving is dangerous and illegal in most states, but there's no risk to texting or working on a laptop while riding a bus or train. Some transit systems have been seeing significant increases in riders.
Another reason for the growing disinterest among young men in driving may be the erosion of the "car-fetish society," travel behavior analyst Nancy McGuckin said. "Today's young adults grew up in the back seat of cars stalled in congestion, hearing their folks swear at the endless traffic. Nothing romantic about that!"
It is also "no longer cool, or even possible, to work on your own vehicle. The engines are so complex most people don't even change their own oil," she said. "Independence, freedom, being able to customize the car to reflect you -- these are not part of young people's association with vehicles."
There also may be economic reasons for the shift, McGuckin's research indicates. Employment of 16- to 24-year-olds as a share of all workers has declined. At the same time, the rate of young men ages 18 to 34 years old living at home has been going up and is greater than the rate of young women living at home.
It may be that unemployment and underemployment have made auto insurance unaffordable for young men, said Alan Pisarski, author of the Transportation Research Board's comprehensive "Commuting in America" reports on U.S. travel trends. "Insurance for males under 25 is just colossally expensive," he said.
There has also been a sharp decline in vehicle trips and the number of miles traveled by vehicle for 16- to 29-year old males, according to McGuckin's analysis of massive government travel surveys between 1990 and 2009. The declines for women were not as great.
"The car companies are very worried," she said.
Gloria Berquist, vice president of the Alliance of Automobile Manufacturers, said the alliance is aware that the share of teens and young adults obtaining driver licenses is dropping, although the association hasn't seen the research on the gender differences.
"Some research has shown that young adults today connect with their friends through their smartphones, but at some point younger consumers still need to get from here to there, and a car is still a priority where public transportation is unavailable or limited," she said. "This is especially true for younger adults when they enter the workforce."
(Source: USA Today, 11/13/12)
||Hunting for Luxury Car Buyers
At Mercedes-Benz of Novi in suburban Detroit, cars in the showroom are wearing big blue bows, and sales manager Mike Dega is gearing up for a record run of holiday-season sales.
"It's started right now," Mr. Dega says. "We've got a full court push."
Luxury brands have traditionally used the final weeks of the year to clear out last year's inventory, while stirring up interest for new models. This year, car buyers can expect more and earlier deals.
The competition between makers is particularly fierce as the two leading German brands, Mercedes-Benz and BMW, vie for bragging rights as the No. 1 luxury brand in the U.S. market. BMW is looking to wrest back the crown it held last year. It has sold nearly 213,000 cars and SUVs year to date, and trails Mercedes by less than 2,800 vehicles.
Both have been rolling out aggressive year-end sales "events" well ahead of the traditional Thanksgiving weekend start.
So confident is BMW in its U.S. market that it is diverting more than 5,000 vehicles from slower-selling European and Asian markets -- including popular all-wheel-drive 3 series sedans. To move all that metal, the German manufacturer is offering discounts of up to $3,500 or more, with additional discounts aimed at retaining existing customers, dealers say.
Mercedes is countering with similar discounts aimed at keeping customers in the fold, along with deals they hope will prod people to switch from rival brands. Mercedes is also allowing drivers of leased cars to get out of their contracts up to five months early if they agree to take a new vehicle.
Other high-end car makers are joining the fray. Volkswagen AG's Audi brand isn't buying out leases early as part of its "Season of Audi" promotion. But the company says it will waive buyers' first-month payment and security deposit. It is also offering discounted leases or finance rates as low as 1.9% for several of its high-volume models. For example, Audi is now advertising a 2013 A6 model with its Quattro all wheel drive system -- list price $50,045 -- for $559 a month, with $3,690 down.
Toyota Motor Corp.'s Lexus brand, which gets credit for turbo charging the luxury-car holiday sell-a-thon concept in the late 1990s, plans to launch its annual "December to Remember" sales push around Thanksgiving. Lexus typically makes its high-volume RX utility vehicle the centerpiece of its sales.
Car shoppers will see so-called "loyalty" and "conquest" discounts in this year's holiday sales campaigns. These deals essentially reward consumers for shopping the competition, even if they intend to stay with the brand they already drive. For example, a customer who owns a Mercedes could get an additional $750 discount for agreeing to buy or lease another. If the same owner went to a BMW showroom, he or she would likely be offered a similar amount to switch teams.
About 20% of shoppers on Edmunds.com who looked at a Mercedes C-Class during the last week of October also looked at a BMW 3 Series, according to data from the site. Among those considering the 3-series, 10% looked at a C-Class, and 10% looked at the Audi A4.
Dealers say discounts specifically tied to retaining existing customers have an impact. "It gives us something else to discuss, to look at a customer and let them know they are special to us," says Robert Camastro, owner of Mercedes of Danbury, CT.
The loyalty and conquest discounts vary by model and brand. Some Audi dealers are advertising discounts of up to $2,500 if you are trading in a rival luxury brand.
Lincoln, a brand of Ford Motor Co., is offering no-money-down lease deals on its MKX sport utility. Cadillac's deals vary, but the brand is offering no-money-down, $399-a-month leases on its just-launched ATS model, which is designed to compete with the 3 series and Mercedes C Class.
Chase Hawkins, Cadillac's vice president of sales, says the GM brand has two major selling drives a year -- during summer and the last two months of the year. The deals are better now, he says.
Luxury car makers and dealers are putting extra effort into this year-end sales drive in part because they are more confident than they have been in several years that consumers will respond.
Experian Marketing Services, which assesses consumer sentiment, says its measure of how likely consumers are to buy or lease a new car rose during the first half of 2012 to the highest level since the first half of 2008 -- before the full force of the financial crisis hit.
The strength of the American auto market relative to Europe and China has encouraged German auto makers to allocate more of their production to these shores. Dealers welcome the extra shipments because, through much of the year, inventories of unsold Audis, BMWs and Mercedes models were still relatively lean. Even with the added vehicles, more expensive, limited-volume models will likely be in short supply. That means the discounting isn't across the board. Audi, for instance, isn't offering significant discounts on its high-performance S models.
For its part, Mercedes won't be offering as generous discounts on its M-Class sport utility as it has in past holiday sales, because the M-Class was just redesigned and is still in relatively short supply.
"We don't need to push as hard on the M," says Stephen Cannon, president of Mercedes' U.S. sales arm. Instead, the focus of the holiday deals will be on the high volume C- and E-class sedans and the GLK sport utility.
Jessica Caldwell, an analyst with auto-shopping site Edmunds.com, says shoppers looking to grab a 2012 model at a comparatively low price should move fast. "They don't have that much in stock," she says. Less than 10% of C Class sedans on Mercedes dealer lots are 2012 models, she says.
Even people shopping smaller luxury brands could benefit from the head-butting among the big German brands.
Janice Monarrez of Grosse Pointe, MI, says she and her husband are shopping for a luxury brand replacement for their 12-year-old Volvo S70.
"We were kind of surprised at how much movement there was on prices when we started to talk to the Volvo dealership," she says. They're waiting to see how much better the deals get closer to the end of the month.
The Race for Luxury Car Sales
Sales through the first 10 months of 2012 show Mercedes and BMW in a dogfight. Other high-end brands lag behind, but have grown quickly since the same period in 2011.
- 215,596 Mercedes vehicles have been sold through the first 10 months of 2012, up 12%.
- 212,848 BMWs have been sold through the first 10 months of 2012, up 6.7%.
- 190,840 Lexus vehicles have been sold through the first 10 months of 2012, up 24%.
- 112,402 Audi vehicles have been sold through the first 10 months of 2012, up 18%.
(Source: The Wall Street Journal, 11/07/12)
||Study: Web Shopping Cuts Dealership Visits
Car shoppers are doing so much research online these days that 58 percent of car buyers visit just one or two dealerships before purchasing their vehicles, a study commissioned by online shopping site AutoTrader.com has found.
By the time online vehicle shoppers arrive at a dealership they generally have decided to look at a specific vehicle, said Kevin Filan, AutoTrader.com vice president of customer marketing.
At that point a salesperson's "mission is to look at a specific vehicle at a dealership that meets their criteria," Filan said of online shoppers.
Between July 2011 and August 2012, AutoTrader commissioned KS&R of Syracuse, N.Y., to survey by telephone 67,742 buyers of new and used vehicles across the country, and published the results last month. AutoTrader.com is a consumer auto shopping site that provides leads to dealers and posts inventory of new and used vehicles from participating dealerships.
The survey also found that online vehicle shoppers are more likely to travel farther to make a vehicle purchase than shoppers who don't use the Internet. About 23 percent of the car buyers surveyed who used the Internet for shopping said they bought their vehicles from dealerships more than 30 miles from their homes. Only 15 percent of shoppers who didn't use the Internet traveled that far.
The study showed that new-car buyers spend an average of 11.5 hours online researching their purchases and 7.5 hours offline in activities such as visiting stores. Used-car buyers on average spend 11 hours online and 7 hours offline.
AutoTrader Group of Atlanta, the parent company of AutoTrader.com., also owns KBB.com, vAuto and VinSolutions, which help dealers price used vehicles, market them to shoppers and perform other services.
AutoTrader has about 20,000 subscribing dealerships, split between new-vehicle franchised dealers and independent used-car stores.
(Source: Automotive News, 11/05/12)
Daily Sales Tip: Know What You're Willing to Concede
Successful salespeople make it a point to know which concessions they're willing to make before the negotiation begins.
Sometimes concessions are an effective way to overcome an impasse, but only when salespeople:
-- ask for something in return (e.g., a long-term contract or minimum purchase level), and
-- gain a reasonable assurance that granting the concession will allow the sale to move forward.
Source: Tom Reilly, president and founder of Tom Reilly Training