By: Jackie Lorch
VP, Global Knowledge Management
Around the world, businesses are cautiously reopening their doors to consumers. Our report, Global Consumer Trends COVID-19 Edition: The Reopening, looks at some of the hardest-hit sectors across 11 countries – including airlines, hotels, restaurants, public transportation, gyms and car-buying – through the eyes of more than 11,000 consumers, examining what it will take for these businesses to successfully reopen, with the safety and cleanliness assurances customers need to resume their buying and spending behaviors.
Our latest brief – Will the Auto Industry Pick Up Speed? – draws from the Reopening report to explore the impact of the pandemic on the automotive industry, from car buying intentions to the automotive aftermarket and ridesharing.
Looking at our findings, we learned that few people have canceled their pre-pandemic car-buying plans entirely, but of those who did, COVID-19 was the overwhelming cause, cited by 88%. While the intent to purchase remains, consumers are delaying the decision.
For example, if people had carried out their pre-pandemic car buying intentions, we would have expected 13% to have bought a car by now, compared to the 7% our research shows have done so. And people are not just postponing in the short term to the next quarter (June to September 2020); we see reduced intent to purchase in that quarter too.
The pandemic has also contributed to a change in priorities among prospective car buyers, with no clear direction in overall decision-making. Sixteen percent say they will now buy a bigger car, 12% a smaller one; 10% plan to buy a more expensive vehicle and 19% a less expensive one; 14% say they will buy one with more “extras,” 8% with fewer. Globally, older generations are more likely to have changed some aspect of their pre-COVID car buying plans – 35% of Baby Boomers have done so, followed by 19% of Millennials and 14% of Gen X.
The diversity of these changes suggests that there are multiple factors people are weighing in making their decision, such as economic uncertainty versus the opportunity to get a good deal on a better vehicle, or perhaps they’ve grown to like their new work-from-home life and have decided to wait on buying a car since they won’t drive to the office every day.
At a time when so many consumers are reconsidering their purchasing options, with many potential factors driving their final decisions, dealers and manufacturers have an opportunity to conduct further research on consumer motivations, concerns and feelings to develop messaging to help guide their final decisions.
The auto industry needs to better understand what is it that prospective buyers are hesitant about and design interventions to address these at the appropriate point in the buying chain, be that at the brand or individual dealer level.
To further explore these findings and other automotive industry research and impacts, and to discover key mile markers on the automotive industry’s road to reopening, visit our COVID-19 Insights resource and download the full report.