Wednesday, April 24, 2013 | Edited by Daniel Moores
||After Inventory Shortages, Japanese, Korean Brands Are Trending Up Again
Japanese and Korean automakers accounted for nearly half of all retail sales in 2012, bouncing back after inventory shortages caused by Japan's 2011 earthquake were resolved.
Asian companies passed the 50 percent milestone in 2009, when they accounted for 50.9 percent of retail volume, which grew to 51.7 percent in 2010. Their share dipped to 48.5 percent in 2011.
But 2012 registration data released last week by R.L. Polk -- which exclude fleet sales -- show that Detroit's long decline in retail share has resumed.
Although last year was a good one for almost all companies, the combined increase in retail sales for Japanese and Korean companies was more than twice as large as the increase of the Detroit 3.
The Asians last year accounted for 49.9 percent of all retail sales. The combined General Motors, Ford Motor Co. and Chrysler Group total slipped from 41.1 percent to 39.4 percent.
Counting all sales, including fleet, the Asians' share was 45.6 percent last year, compared with 44.5 percent for the Detroit 3.
Detroit's 2011 comeback was an aberration, said Polk analyst Tom Libby.
"The numbers were abnormally low for Toyota and Honda in 2011, so we're seeing a major sales increase when they got inventory back," he said. "Before 2011, their share was tracking over the (Detroit 3)."
In 1999 the Detroit 3 held 62 percent of retail sales. By 2004 that had dropped to 53.6 percent.
The recession accelerated that trend.
The combined Japanese and South Korean brands took a majority share in 2009. By 2010, Detroit brands accounted for just 38.5 percent of the retail market. But the 2011 Japanese disaster ravaged Toyota and Honda inventories in particular.
Toyota reclaimed its title as America's No. 1 retail brand. While second-place Ford gained about 105,000 retail sales, Toyota Division added nearly 325,000. Toyota won the race by more than 111,000 units.
Chevrolet held off Honda as the No. 3 retail brand by only about 27,000 units. The Honda brand outsold Chevrolet from 2008-2010, but quake-related inventory shortages dropped Honda to fourth place in 2011. Honda Executive Vice President John Mendel expects to reclaim third place soon.
"Honda has the strongest momentum of any brand when it comes to true retail sales," he said.
In 2008, Hyundai and Kia accounted for less than 5 percent of U.S. retail sales. Last year they were just shy of 10 percent. The Koreans now outsell all European brands combined.
The Polk numbers also show that:
• Bragging rights for the top-selling luxury brand go to Mercedes-Benz over BMW by 5,025 units. Mercedes sales did not include Sprinter or Smart; BMW sales did not include Mini.
• Ford's F series remains the best-selling retail vehicle in the United States, and the Toyota Camry passed the Chevrolet Silverado for second place.
While daily rental fleet sales can depress brand and residual values, longer-term sales to government and corporate accounts can bolster the bottom line without depressing residuals.
Ford is the leading provider of commercial fleet sales to businesses, which includes corporate lease vehicles and sales of F-series trucks to contracting and farming companies. That business represents about 15 percent of Ford's total sales.
Detroit has done a fair job of weaning itself from the fleet sales that dominated its business during the recession, Libby said. Still, Detroit 3 fleet sales far outpace those of the Asian brands.
"The domestics' retail mix has improved," Libby said. "In 2009 that retail mix went down substantially, especially for Dodge, but it has since recovered. It's more normal now."
(Source: Automotive News, 04/22/13)
||The Cost of Owning Your Car? $9,000 a Year
The average owner of a vehicle has to shell out more than $9,000 a year to own and operate that car, according to auto club AAA.
A new AAA reports shows, on average, the cost of driving 15,000 miles a year rose 1.17 cents to 60.8 cents per mile, or $9,122 per year. Overall, that's a roughly 2% increase on the cost of operating a car last year.
Auto club AAA studies five cost categories -- maintenance, fuel, tires, insurance and depreciation -- for its annual "Your Driving Costs" study.
The biggest percentage increase this year was in maintenance costs, which grew by 11.26% to 4.97 cents per mile, on average, for sedan owners. Average costs in all categories are lower for smaller vehicles and higher for bigger ones.
The maintenance cost estimates are based on the cost to maintain a vehicle and perform needed repairs for five years and 75,000 miles, including labor expenses, replacement part prices and the purchase of an extended warranty.
"As a vehicle gets older you tend to encounter more significant repair costs," says Michael Calkins, AAA's manager of technical services.
Since last year's study, there were substantial increases in labor and parts costs for some models, and a significant rise in the price of extended warranties. "People are keeping cars longer," Calkins says. "Extended warranties are seeing a bit of an increase in claims. That's where the costs have gone up."
The second biggest increase: Insurance costs, which rose 2.76%, or $28, to an annual average of $1,029. AAA's insurance cost estimates are based on a low-risk driver with a clean driving record.
Fuel costs rose 1.93% to 14.45 cents per mile for the average sedan owner. The actual average cost of regular gas went up 3.84% to $3.49 per gallon; but several of the vehicles in the AAA study had small improvements in fuel efficiency, which partially offset the fuel cost increase.
Depreciation costs, which had dropped in last year's study, ticked upward slightly, by .78% to $3,571 a year. That might be because, as new vehicle sales recover, more used cars are available, which has softened the resale value of clean older models, Calkins says.
"The length of time people keep cars has been going up for the past several years, since the real estate crash," he says. "The average age of the vehicle on the road now is 11.1 years. It's not just for financial reasons that people are keeping cars long. The quality of the cars is also improving."
Tire costs did not change from last year, remaining at about one cent per mile, on average, for sedan owners.
AAA has published "Your Driving Costs" since 1950. That year, gas cost 27 cents a gallon, and it cost about 9 cents a mile to drive 10,000 miles a year.
(Source: USA Today, 04/16/13)
||Most Car Shoppers Prefer 'The Deal' More Than Latest Design
As much as car enthusiasts gush over new automotive sheet metal and technology, nearly 80 percent of car shoppers would prefer to get a good deal on a car than wait for a newer design, a recent online survey shows.
The survey by AutoTrader.com found that 57 percent of shoppers do not feel it is important to have the latest vehicle redesign.
Although more than half of all automotive shoppers perform Internet research about new-model releases, most of them do that so they can negotiate a better price on an older model, the survey stated.
"This is a bit counterintuitive, given how much effort, expense and emphasis the industry puts on redesigns," said Rick Wainschel, AutoTrader vice president of automotive insights.
The commoditization of many car segments has led to purchase behavior similar in nature to TV or smartphone shopping, Wainschel said in an interview. AutoTrader said 130 people responded to the online survey in March -- with a margin of error of four percentage points.
An older, "pretty darn good" product will often generate more interest than the latest technology simply because the deal is more attractive, he added.
But the current economic climate and fluctuating consumer confidence levels could have an impact on car-shopping behavior.
Another recent AutoTrader survey showed 71 percent of respondents said they were buying a car out of need, with just 29 percent buying because they wanted to, Wainschel said.
In that survey, 27 percent of respondents said "affordability" was the No. 1 reason for buying, compared to 10 percent buying for design or styling, and just 3 percent for new technology.
"The economy is thawing, but the signs are that it is thawing slowly," Wainschel said. "People are bringing a residual caution that is causing price to be a continuing factor of great importance."
There are exceptions, obviously. When a product undergoes a revolutionary change -- such as the last Hyundai Sonata and Kia Optima redesigns -- the shopping behavior also changes.
"The cross-shopping data show that the new Sonata and Optima have become destination vehicles," Wainschel said. "But if the changes are evolutionary, then people are willing to compare prices and deals more."
(Source: Automotive News, 04/12/13)
Daily Sales Tip: The 'Right' Personality for Sales
Of all the topics I have written about over the years, none gets more of a reaction than the question of sales personality. Whether it is in my blog, on LinkedIn, or in discussions around my books, no subject around sales and selling seems to be more provocative.
But here is the problem...It is a thoroughly misguided question.
If the goal of asking it is to learn if a certain person will be good at selling, or what a certain person needs to do to get better at selling, then chasing an answer to questions related to personality are completely off target, and entirely useless.
How can that be? Great salespeople always seem to be...
OK -- hold it right there!
How many successful salespeople do you know? Think about that for a second. If you don't know any, think of some famous examples:
- Steve Jobs
- Bill Gates
- Warren Buffet
- Seth Godin
- Richard Branson
Not all salespeople by trade, but they all are famous for successfully selling their ideas.
Do they all have the same personality? Not even close. What about the salespeople you know? Probably a mixed bunch there, too.
Some are funny, some shy, some nerdy, some intellectual, some very blue collar. Some joke around, some are deadly serious.
None of these factors -- or elements of personality -- correlate to sales success.
So what does?
To answer the question, you need to look at what sales really is. Success in sales comes from thoroughly knowing the solution you offer, listening to the needs, desires and/or problems of the prospective customer, and effectively matching the two.
Being successful at that requires SKILLS, not a particular personality. But aren't those skills based on personality? Absolutely not. Then what are those skills?
Intelligence, empathy, listening, communication, persistence, positive mental attitude, and many more, in many combinations.
Sales is a skill set that can be learned and improved over time, and with effort. Anyone who says that sales is driven by personalty doesn't understand what sales really is, and isn't worth listening to if your goal is to try to improve, or to find, manage and develop sales talent.
Source: Sales consultant/author David Masover