May 22, 2012

BMW Replaces Toyota as Most Valuable Global Car Brand
BMW has overtaken Toyota as the world's most valuable automotive brand, an annual ranking of the world's top brands shows. Mercedes-Benz, Volkswagen, and Audi improved their brand value, according to the BrandZ Top 100 Most Valuable Global Brands study released by market research company Millward Brown today. Peter Walshe, Millward Brown global brand director, said that BMW has been able to effectively communicate what sets it apart from other carmakers, while backing up its message with a "very decent product." BMW was also the most valuable auto brand in 2010, while Toyota held the top spot from 2006 until 2009 as well as last year. Automotive News reports that Mercedes-Benz, Volkswagen, and Audi were able to rise in the ranking successfully expanding their presence in Asia. Hyundai is the first Korean brand to enter the automotive top 10, taking ninth in the ranking. Walshe said Hyundai's brand value benefits from customers worldwide who seek quality and style at a better price than that charged by the premium brands. Millward Brown measures brand equity based on interviews with more than 1 million consumers globally and an analysis of the financial and business performance of each company. Read more on how automotive brands fared in this year’s rankings here.

Survey: Gas Mileage Top Concern for New Car Buyers
New-car buyers ranked fuel efficiency their top issue and are considering smaller, more fuel-efficient vehicles, according to survey by Consumer Reports released today. According to The Detroit News, the survey found 37 percent of buyers said their leading consideration when shopping for their next car will be fuel economy. Quality, at 17 percent, was a distant second, followed by safety (16 percent), value (14 percent), and performance (6 percent). "These results make it clear that high fuel prices are continuing to impact driver behavior and influencing future purchase considerations," said Jeff Bartlett, Consumer Reports deputy auto editor. "While quality, safety and value are still important, this may be foreshadowing a market shift by folks seeking relief at the pump." Click here to read Consumer Reports’ rundown on the concerns of new car buyers. In 2006, fuel efficiency was the fourth-most important factor for car buyers, steadily increasing since 2001, when it was the 22nd-most important. In the Consumer Reports survey, two-thirds of owners surveyed said they expected their next vehicle to get better fuel mileage than the one they're driving now. For more on what today’s new car buyers are looking for, click here.

Execs See Hyundai/Kia, VW/Audi Likeliest Gaining Shares
U.S. auto executives, surveyed by Booz & Co., named Hyundai and Kia, and Volkswagen and Audi, as the OEMs most likely to pick up share in the American market over the next five years, reports Forbes. Of the poll of 200 senior executives of automakers and top-tier suppliers, 88 percent lent Hyundai/Kia their highest expectations for market share, and 72 percent cited Volkswagen/Audi. The two companies were far ahead of all other automakers in the poll. Ford, with 38 percent; BMW/Mini, 31 percent; Toyota/Lexus and Chrysler/Dodge/Fiat, 28 percent, were the next finishers. “Both [Hyundai/Kia and VW/Audi] are rising from relatively small positions, so the responses didn’t really surprise us; the only way they could really go is up,” Scott Corwin, New York-based partner for the major consulting firm, told me. “Whereas you saw after the tsunami, the Japanese manufacturers were in a spot where they had to defend their big positions.” Corwin noted that Booz’s data came from a survey of the opinions of industry insiders, and captured “a snapshot in time,” rather than from an independent analysis of brands based on their projected future product lines. Click here to read more on the views of auto industry leaders.

Study: Used Dealers to Experience Moderate Growth as New-Car Dealers Become More Competitive
As dealers, new and used, struggled to stay afloat after the recession hit in 2008, the past five years have been tumultuous. But, as the economy picks up, what’s in the cards for used-car dealers? According to Auto Remarketing, industry research firm IBISWorld looks to answer that question with its new "Used Car Dealers in the U.S." industry report. The company outlines what it expects will help used-car dealers “stay competitive and increase profitability” in the next five years. In doing this, officials noted that the adoption of lease-here, buy-here financing options will aid dealerships, but the organization of the Consumer Financial Protection Bureau, as well as increased regulation, could put a damper on growth and potentially limit financing practices. Furthermore, IBISWorld contends that used-car dealers will face increased competition from new-car dealers in the near future. Though used-car dealers may be facing growing competition from new-car stores, dealerships that sell pre-owned vehicles may not be experiencing as many lingering effects from the 2008 economic downturn, according to IBISWorld. Read more about how new and used car dealerships are faring in today’s economy by clicking here.

Higher Incentive Spending Lifts VW Brand
Volkswagen of America is spending more per vehicle on incentives for its VW brand models in a bid to attract more shoppers and boost sales. According to Automotive News, the tactic appears to be paying off. Not only are sales up, but so is VW's average transaction price – a sign that customers aren't pocketing the savings but using them to buy more car. The move comes as Volkswagen seeks to become a bigger player in the United States, aiming to sell 800,000 VW brand vehicles annually by 2018. To hit this target, the VW brand must more than double U.S. sales in the next six years from 324,402 in 2011, which would require attracting more first-time VW buyers and taking market share from rivals. In April, VW brand spent $2,020 per vehicle on incentives, a 31 percent increase over the same month a year ago, but still below the industry average of $2,428, according to research firm Autodata Corp. "There is no question that our growth is going in the right direction," said Frank Trivieri, VW of America's vice president of sales. "But you have to keep your eye on what the market is doing." Click here for more on VW’s incentive spending.

ARMS® Application Adds Value at No Cost to Momentum BMW/Mini
The service department at Momentum BMW/Mini, the largest BMW dealership in Houston, uses a lot of tools – but only one tool helps them manage and control rental car costs better than ever before. According to Daniel MacFadden, Service Director for Momentum BMW/Mini, the Automated Rental Management System (ARMS®) application from Enterprise Rent-A-Car is one of the most prized tools in the service department because it provides daily oversight of the number of authorized rental days for cars outsourced to Enterprise. “At a glance, the ARMS® application lets me know how many rental cars are out, who wrote the order and when the rental car is due back so I can manage how much money I’m spending instead of the rental car company,” said MacFadden. “You can’t get a better tool than that.” As soon as any of the 16 assistant service managers at Momentum BMW/Mini initiates a repair order for service, the ARMS® application automatically creates an electronic purchase order for a rental car. For more information or to arrange a demonstration of the ARMS® application, please go to www.ARMSDealership.com or e-mail ARMSDealership@erac.com.

Around the Web
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Carroll Shelby's Million Dollar Muscle Cars [CNN Money]
Cool VW Golf GTI Convertible That USA Won't Get [DriveOn]
Toyota to Boost Engine Production in North America [Driver's Seat]

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