Buyers shun GM, Chrysler as rescue draws focus, study says
March 19, 2009 - 8:00 pm ET
DETROIT (Reuters) -- Fewer new car shoppers are considering vehicles
from General Motors and Chrysler LLC at a time when consumer attention
is focused on their request for further U.S. government aid, according
to a survey released today.
The share of car shoppers who say their primary choice would be a
vehicle from one of the GM brands dropped by almost 12 percent, while
the share for Chrysler dropped by a third, according to the study from
"There is nothing to stop the slide in intentions for those on the
downside of this survey," CNW said in a monthly research note on the
auto market. "But the decisions to cut back on advertising haven't
helped GM or Chrysler. Nor has the talk of bankruptcy, which continues
to haunt those brands."
Ford Motor Co., the only U.S. automaker not relying on emergency aid
from the U.S. government, has seen a nearly 12 percent increase in the
share of car shoppers who say it would be their first choice.
The CNW survey was based on responses from more than 40,000 consumers
who say they intend to buy a new vehicle. The study was conducted in
January and February, when GM's sales plunged by 51.1 percent and
Chrysler's dropped by 49.1 percent from year-earlier levels.
Honda Motor Co. showed a 13-percent jump in its ranking as a primary
choice among those who intend to buy a vehicle.
The biggest gains in the CNW survey came for South Korea's Hyundai Motor
Co. and its affiliate Kia. Both brands have boosted U.S. sales this year
while the overall market has fallen 39.4 percent.
The share of car shoppers who say Hyundai would be their primary choice
jumped 59 percent, and Kia rose by almost 50 percent.
On a combined basis, the two Korean brands had a U.S. market share of
just over 5 percent in 2008.
"Hyundai and Kia show staggering increases in future consideration," CNW
said. "While that may be considered a distortion because they are
starting with a low base market share, it is worthy of consideration
considering how well both brands have been doing during the past rough
Earlier this year, Hyundai rolled out a novel incentive program that
allows car buyers to return their vehicles if they lose their jobs.
GM has said it is studying the Hyundai offer and may offer a similar
program of its own.
AutoNation Inc., the biggest U.S. auto retailer, said this week it would
begin offering car buyers a guarantee program that will cover up to six
months of payments for consumers who lose their jobs.