Highly touted electric cars will be rolling off the assembly lines later this year. And while consumers  are intrigued by this new automotive category and have incentive to buy, thanks to a sizeable tax credit, they also have questions. The findings of a recent Consumer Electronics Association survey show that auto makers are likely to engage in educational ad campaigns to boost sales.

Here’s what consumers like about electric cars:

• Vehicles don’t use gasoline 78%
• Less pollution 67%
• No need for oil-changes or tune-ups 60%

However, consumers are also hesitant to purchase an electric vehicle. Price is an issue. Even with the tax credit, a GM Volt will cost about $33,500 and the Nissan Leaf will cost $25,280.  Some models, for now, may only run 40 miles on a battery charge before the engine switches to the gas engine that allows an additional 300 mile range. And the batteries will need to be charged at home or at work. Here are the specific consumer concerns on this topic:

• Running out of battery power on the road 71%
• Unable to recharge 66%
• Limited mileage range 59%
• Not interested in installing a home-charging station 51%

Bracken Hendricks, a senior fellow at the Center for American Progress, says “[e]lectric vehicles are going to be the dominant automotive technology of the future. All the trends are moving that direction.”  Because of the performance uncertainty and higher prices, manufacturers will be promoting leases as the best way to purchase an electric car. In addition, auto manufacturers are expected to launch educational campaigns in the next few months to generate sales and interest in this category.

[Sources: Clayton, Mark. Chevy Volt vs. Nissan Leaf. Csmonitor.com. 27 Jul. 2010. Web. 27 Aug. 2010; Americans Want to Give Electric Vehicles a Test Drive. CEA.com. 23 Aug. 2010. Web. 27 Aug. 2010]

Auto parts retailers are benefiting from consumers now making good on their intentions to keep their aging vehicles on the road longer, after deferring repairs for the last two years. According to automotive aftermarket research by The NPD Group, a leading market research company, auto parts retailers experienced a seven percent growth in dollar sales for year-to-date April 2010 versus a year ago.

NPD’s Aftermarket Industry Monitor, which tracks item-level sales at more than 18,000 U.S. auto parts store,  finds that the sales growth is driven by applications parts, which increased 10 percent in dollar volume for the January through April 2010 time period versus a year-ago. The dollar gains, according to the “Aftermarket Industry Monitor,” came from real unit volume growth reflecting an actual increase in consumer transactions for replacement parts. Much of the volume growth came through the commercial channel, as repair shop bays filled up with aging vehicles.

“I believe what we’re seeing is that consumers have begun to recognize that repair costs are more economical than replacement costs,” says David Portalatin, industry analyst for NPD’s automotive aftermarket business. “Consumers have been telling us for two years   they were aware their autos needed service but they were putting it off. They are now realizing they can no longer put off the services and are making the needed repairs.”

The top five hard parts categories, based on unit volume percent change for year ending April 2010, are suspension, application electrical, climate control, brakes, and driveline.

“The increase in application parts sales is a case where consumers’ intentions, what they say, did portend exactly to what they would do in the future.” says Portalatin. “By paying attention to what consumers said in 2009, marketers could anticipate what consumers would do in 2010.”

[Source:  "Aftermarket Industry Monitor."  The NPD Group. 9 Aug. 2010.  Web.  17 Aug. 2010.]

With summer’s warm weather, more motorcyclists are hitting the roads than ever before.  According to a recent survey by the Motorcycle Industry Council, the number of motorcycles owned and used in America grew 19% since 2003.  That means an estimated 25 million people – equal to the population of Michigan! – swung a leg over a bike and rode in 2009.

Baby boomers, many with their children grown and more time or their hands, make up 44% of all riders, according to the survey.  Unfortunately, riders 40 and older also make up a large portion of motorcycle accidents, with fatalities in this group nearly quadrupling in the last 10 years, reports the National Highway Traffic Safety Administration.  Forty-five percent of those fatalities were caused by rider error.

“Summer is a prime time for motorcycle accidents,” says Jim Millard, lead motorcycle instructor at the BMW Performance Driving School in Greer, S.C.  “More motorcyclists and automobiles are sharing the road than at any other time during the year.”

Millard suggests that riders take a refresher course with a qualified instructor before venturing out, and offers these rider safety tips:

• When riding, keep the eyes scanning!  It’s imperative that you look way ahead and gather information early so you have time to react.   Always “lead” the bike with your eyes by looking where you intend to go. This means looking through a corner before you ask the bike to negotiate the corner.

• Understand your bike’s braking capabilities. It’s a good idea for riders to know their bike’s ability to slow down.  This can be a scary thing to learn, so a lot of riders don’t learn it until they NEED their brakes’ full potential and that is not the time to learn it.  Good rider training classes will have a session on braking techniques and these exercises will give you the confidence and understanding of how to utilize your brakes effectively in an emergency situation. This should include bikes with and without ABS.

[Source:  Increasing Number of Motorcyclists Demands Increased Attention to Rider Safety.  BMW Group PressClub. 11 Aug. 2010.  Web.  12 Aug. 2010.]

As Americans emerge from the recession, they are buying much different vehicles than they did before the crash – smaller and more fuel-efficient – signifying a major shift.  Compared with consumers in the first half of 2007, Americans now are buying more cars, fewer trucks and smaller vehicles in general; smaller and less expensive cars within segments; and ordinary rides that replace bigger or more luxurious vehicles.  Still, as they go down in size, buyers aren’t necessarily sacrificing equipment.

“We’ve got people trading Lexuses for Camrys,” said Ernie Sims, executive vice president of Al Hendrickson Toyota in Coconut Creek, Fla. “Buyers are much more cautious, more rational.”

Cars are outselling light trucks again, taking 53.4% of the market in the first half. That compares with 49.2% in the first half of 2007. But a close look at the numbers reveals an even more dramatic shift.

When car-based crossovers and minivans are lumped in with cars rather than with trucks, the swing away from body-on-frame pickups, SUVs and full-sized vans is striking. The big trucks plunged from 31.1% of the U.S. market in the first half of 2007 to 22.8% in the first half of 2010.  Car-based vehicles grew to 77.2%t, from 68.9% in the same period.

SUVs have fallen more than any other segment during the three year-span: to 7.9%, from 12.8%. The car-based crossovers that look like SUVs but handle better and get better mileage have grown by 5.2 share points — 19.6% in 2010, from 14.4% in 2007.

“When gas prices spiked [in 2008] and manufacturers dropped big incentives on high-end trucks, consumers felt burned and SUVs got hit real hard,” said George Magliano, a forecaster for IHS Automotive. “Manufacturers shifted from SUVs to crossovers.”

Within segments, buyers are moving to less premium nameplates.

For example, upscale cars held their 6.4% share overall over the three-year stretch. But demand has shifted some from larger vehicles, such as the BMW 7 and 5 series and Mercedes S and E class, toward the likes of the Mercedes C class.

Similarly, sporty cars stayed at 3.0% of the overall market. But lower-tier sporty models such as the Ford Mustang and Chevrolet Camaro have gained a half point, while the group of pricier sports car nameplates, including the Chevrolet Corvette and BMW Z4, went from 0.6% to 0.2%.

The growth in car sales is all at the lower end. The small-car category that includes the Toyota Corolla and Ford Focus commanded 13.8% of the U.S. market in the first half of 2010, up from 12% in the first half of 2007. Mid-sized cars, led by the Honda Accord, Toyota Camry and Ford Fusion, held 30.3% of the market, compared with 27.9% in 2007.

Even within the mid-sized car segment, consumers are shifting down. The pricier end of the category, which includes the Chrysler 300 and Nissan Maxima, has lost share since 2007, while the gains were concentrated among less expensive models such as the Hyundai Sonata and Nissan Altima.

But consumers are not necessarily choosing cheaper vehicles. Transaction prices are rising. Equipment levels and technology content are higher in even the smallest models, manufacturers say.

“When consumers downsize, they don’t leave behind the options, content and features they had,” said George Pipas, chief sales analyst for Ford Motor Co.

“Now our Fiesta, Focus and Fusion have options like Sync that weren’t available on smaller vehicles three years ago.”  Ford customers are buying greater proportions of upper-end trim levels and technology features, boosting per-vehicle revenue, he said.

IHS Automotive’s Magliano thinks most of the changes are permanent.
“We’re moving into an era of less ostentatious buying habits,” Magliano said.  “Some of these segments are never coming back, either because consumers have irrevocably moved away or the manufacturer has pulled the product.”

[Source:  Snyder, Jesse.  "It's official: Buyers downsized."  Automotive News. 12 Jul. 2010.  Web.  21 Jul. 2010.]