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Study: Brand stability sways U.S. car buyers

Ford cranked up the horsepower on its 2011

Ford cranked up the horsepower on its 2011 Mustang as it tried to win back muscle car buyers. (Oct. 29, 2009) Credit: AP File

Their bankruptcies, government bailouts and eliminations of models or brands earlier this year cost General Motors and Chrysler sales in their showrooms, a new study documents. But the carmakers' brushes with financial death also prompted a small buy-American backlash against imports, the study found.

While styling, price and perceived reliability remained the three biggest reasons that consumers cited for avoiding certain models, concern about the future of the brand was the fourth reason cited by people who purchased cars in May and June, said J.D. Power and Associates, the California-based market research company that did the study.

Based on a survey of 45,000 consumers, Power said the brands most often avoided because of such concerns were Chrysler, Dodge, Hummer, Pontiac and Saturn.

"New-vehicle buyers want to know that if anything goes wrong with their vehicle in a year or two, that the manufacturer will be there to back up their product," said Kerri Wise, Power's director of automotive research.

Yet the styling of the Pontiac G3 and Dodge Challenger, along with that of the Kia Soul and Audi Q5, were the best liked overall.

General Motors is killing the Pontiac and Saturn brands as it trims production in line with its shrunken market share. It plans to sell Hummer to Tengzhong Heavy Industrial Machinery of China and to sell its Saab brand.

Power said that, in their respective price segments, the brands most avoided for any reason were Suzuki, Saab, Mitsubishi and Hummer - because of reliability concerns in the cases of Suzuki and Mitsubishi. The brands most often considered, Power said, were BMW, Honda, Toyota, Lexus and Ford - again in their respective price segments.

Imports have increased their U.S. market share this year, Power said, but 24 percent more buyers of domestic models this year than last are citing "buy American" sentiments.

Power said fewer consumers avoided Ford, Lincoln and Mercury vehicles than avoided GM and Chrysler models. "This could be largely attributable to the fact that Ford did not enter bankruptcy proceedings or receive government assistance during the auto industry bailout," Power said.

Both GM and Chrysler are out of Chapter 11 bankruptcy; GM filed June 1 and emerged July 10. Chrysler's bankruptcy, filed for April 30, effectively ended June 10 when Italy's Fiat took a controlling interest in the company. The improved financial picture for both carmakers should help ease prospective buyer concerns, Wise said.

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