INDUSTRYLANDSCAPE
STEVE STURM
MARKETSALES REVIEW
Q1 2014
15.3 15.7
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
Q1 2013 Q1 2014
SAAR Performance
Million...
MARKETSALES REVIEW
March 2014
15.3 16.1
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
Mar-13 Mar-14
SAAR Performance
Millio...
BRANDPERFORMANCE
4
46%
38%
33%
23%
16%
16%
13%
13%
13%
13%
13%
10%
7%
7%
5%
4%
1%
1%
-2%
-2%
-3%
-4%
-6%
-6%
-8%
-10%
Jeep...
INDUSTRYFORECAST
2nd Quarter and 2014
Vehicle Prices
$29,300
+$700 from 2013
Vehicle Incentives
$2,773
+7.9% vs. February
...
MARKET SHARE WAR
• Core Brands & Core Models:
– Compact and mid-size cars
– Full size pick-ups
– Cross-overs
– Luxury entr...
• Fuel prices – Any major upward
price movement will shift focus
from truck to car (hybrids)
• Interest rates – Any major
...
16.1MSALES FORECAST IN 2014
Source: IHS, October 2013
41NEW PRODUCT LAUNCHES SCHEDULED
IN 2014
Source: IHS, April 2013
9
2014NEW PRODUCTS –30
1st Half 2nd Half
• TLX redesign
• Fit redesign, Fit crossover debut
• Genesis re-engineer • Sonata r...
TWO KEY PRODUCTTRENDS
By 2020, 90% of cars will be connected
to the internet (up from 10% today)
One of the fastest growin...
These fullsize pickup and SUV
buyers generate the largest profit
of any vehicle type
Hit hard by the recession, this
segme...
CONSUMERSGAINCONTROL
Brand loyalty varies by
age, but is generally
declining. Loyalty is
lowest among buyers < 30
years ol...
AD SPENDING
SHIFTS& INCREASES
$14.8 Billion in 2012
• Tier 1 = $8.8 Billion
• Tier 2/3 = $6.0 Billion
Fastest growth rate ...
Q & A
15
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thinkLA Automotive Breakfast 2014 - Steve Sturm Presentation

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thinkLA Automotive Breakfast 2014 - Steve Sturm Presentation

  1. 1. INDUSTRYLANDSCAPE STEVE STURM
  2. 2. MARKETSALES REVIEW Q1 2014 15.3 15.7 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 Q1 2013 Q1 2014 SAAR Performance Million, Q1 2013 vs. 2014 +2.6% 2.2% 3.8% 1.9% 1.7% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% Domestic Japanese Korean European SAAR Performance % Change, Q1 2013 vs. 2014
  3. 3. MARKETSALES REVIEW March 2014 15.3 16.1 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 Mar-13 Mar-14 SAAR Performance Million, March 2013 vs. 2014 +5.2% 10.1% 9.5% 7.7% 10.8% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% Domestic Japanese Korean European SAAR Performance % Change, March 2013 vs. 2014
  4. 4. BRANDPERFORMANCE 4 46% 38% 33% 23% 16% 16% 13% 13% 13% 13% 13% 10% 7% 7% 5% 4% 1% 1% -2% -2% -3% -4% -6% -6% -8% -10% Jeep Lincoln Jaguar Subaru Jeep Lexus Infiniti Buick Nissan BMW Buick Acura Mercedes Land Rover Dodge Audi Mazda GMC Chevrolet Toyota Ford Honda Volvo Cadillac Chrysler VW Sales, % Change Q1 2013 vs. 2014 On a Roll Middle of the Road Struggling Subaru Lexus Infiniti Nissan Acura Mazda Toyota Honda
  5. 5. INDUSTRYFORECAST 2nd Quarter and 2014 Vehicle Prices $29,300 +$700 from 2013 Vehicle Incentives $2,773 +7.9% vs. February Vehicle Production 4M vehicles built in NA in Q1 +3% from 2013 63 days supply in dealer stock +3 days over normal Average Age of U.S. Car and Truck in Operation 11.4 years 9.6 years in 2002 2014 Market Forecast 16.1M – today 16.2 – beginning of 2014 2014 North American Production 16.5M +3% from 2013
  6. 6. MARKET SHARE WAR • Core Brands & Core Models: – Compact and mid-size cars – Full size pick-ups – Cross-overs – Luxury entry THE NEXT QUARTER ANDBEYOND Tier 1 • Ongoing Sales Events – May, June, Aug, Sept, Dec Tier 2 • Heightened focus Tier 3 • Dealers will increase spending with strong market and continued strong factory incentives
  7. 7. • Fuel prices – Any major upward price movement will shift focus from truck to car (hybrids) • Interest rates – Any major upward movement could weaken sales if Auto companies don’t maintain incentive levels Increased targeted marketing spend: • Tier 1: More focus on digital vs. TV/Print • Tier 2: Expanded digital presence NEW PRODUCTS WILL RULE FACTORS TO WATCH THE NEXT QUARTER ANDBEYOND
  8. 8. 16.1MSALES FORECAST IN 2014 Source: IHS, October 2013
  9. 9. 41NEW PRODUCT LAUNCHES SCHEDULED IN 2014 Source: IHS, April 2013 9
  10. 10. 2014NEW PRODUCTS –30 1st Half 2nd Half • TLX redesign • Fit redesign, Fit crossover debut • Genesis re-engineer • Sonata re-engineer • Q70 Hybrid debut • Q60 coupe debut, Q70 freshen • Sedona redesign, Soul EV (or early 2015) • RC 350 debut, NX 200t debut • CX-5 re-engineer • Mazda2 redesign, Mazda6 re-engineer (or early 2015) • Outlander Sport re-engineer, Outlander plug-in hybrid debut • Versa, Maxima, Murano, Frontier, Xterra, Altima freshen • WRX/STI redesign • Impreza freshen, Outback, Legacy redesign • Highlander redesign • Camry freshen , Tacoma redesign Source: Automotive News
  11. 11. TWO KEY PRODUCTTRENDS By 2020, 90% of cars will be connected to the internet (up from 10% today) One of the fastest growing segments, posting a CYTD gain of 25% vs. last year HIGH TECH FEATURESALTERNATIVE FUELS Source: Automotive News, November 2013; The Connected Car Industry 2013 report (Telefonica) 11
  12. 12. These fullsize pickup and SUV buyers generate the largest profit of any vehicle type Hit hard by the recession, this segment is recovering and expected to account for 13% of sales in 2014 Capturing this demo is key to success for auto brands because of its sheer size (80+ Million) ALPHA MALESLUXURY BUYERSMILLENIALS THREEKEYTARGETAUDIENCES 12
  13. 13. CONSUMERSGAINCONTROL Brand loyalty varies by age, but is generally declining. Loyalty is lowest among buyers < 30 years old. LESS BRAND LOYALTY The internet, now the #1 most influential source for researching new car purchases, gives consumers faster and better access to information GREATER TRANSPARENCYProduct proliferation means more choice, higher quality, and better value for consumers MORE CHOICE Source: ORC International, March 2012; AOL Research 13
  14. 14. AD SPENDING SHIFTS& INCREASES $14.8 Billion in 2012 • Tier 1 = $8.8 Billion • Tier 2/3 = $6.0 Billion Fastest growth rate of all industries Will increase to nearly $15.5 Billion in 2014 Across all tiers, the shift to digital continues at the expense of more traditional mediums with mobile and video leading the way AUTOS RANKS #2 IN AD SPENDING DIGITAL CAPTURES MORE AD SPENDING DOLLARS Source: The US Automotive Industry, eMarketer (June 2013) 14
  15. 15. Q & A 15

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