|Farley: Demographic Shifts, Consumer Fuel Economy Focus, Mobile Growth Reshaping Post-Recession U.S. Auto Industry|
While the great recession has fundamentally reshaped the automotive industry over the past few years, the real game changer may come from a new post-recession consumer mindset, demographic shifts and how automakers respond.
"Just as everyone is breathing a huge sigh of relief about getting back to something resembling normal sales levels, the real news is that the great recession has dealt a fundamental change to the consumer's mindset," said
Delivering the keynote address at the 2013 New York International Auto Show, Farley said the recession has profoundly influenced how consumers weigh purchase decisions and what they value in automobiles. He highlighted several key post-recession trends that will drive industry change – shifting expectations around luxury, the rise of women and Hispanics, a renewed focus on fuel economy, and the rapid proliferation of mobile platforms.
New luxury expectations
He noted that a recent
Another luxury trend: Small utilities are outpacing all other luxury vehicle segments for growth, with nearly a 60 percent jump in 2012 and a more than 200 percent increase in the past four years.
Women, Hispanics transforming the market
Perhaps the most powerful trend is the rising consumer power of women globally. "More than 1 billion women will enter the middle class globally by 2020, and many will be buying vehicles for the first time," Farley said.
Rapid urbanization is drawing women to cities all over the world, where they are trading agricultural work for careers in business and other professions. Women buyers are outpacing men for the first time ever in
Meanwhile, Hispanic households are becoming increasingly affluent with a 126 percent increase in U.S. Hispanic households making more than
"As Hispanics buy luxury vehicles at a faster rate than the overall market, our brands must become more compelling, interesting and relevant than ever," Farley said. "Millennials are also a significant opportunity, as they will start entering the family stage in record numbers during the next several years."
The power of mobile platforms:
As nearly one in seven people worldwide now uses a smartphone, this has significant influence on the auto industry.
"Cars were a step change in giving society the ability to stay connected and engaged with the people they cared about," he said. "The opportunity at hand today is not about phones or social software in cars – but about remembering that no matter the device, it's the ability to connect that matters."
"Automobiles will soon become a seamless part of the consumer mobile experience," he said. "Actually it will enhance the experience. When your dash becomes a seamlessly connected screen, it truly becomes a more important, integrated part of your life."
Fuel economy reigns
"We now have a torrent of 'best-in-class' claims hitting consumers from all sides, and it's starting to become noise," Farley said. "We are seeing more and more confusion as consumers try to make informed decisions. Given the connectivity in our cars and the proliferation of mobile devices, we have the opportunity to give consumers better and more relevant data to understand what they can expect in on-the-road fuel economy performance."
Harnessing the power of mobile platforms, Farley announced developers will have access to Ford's OpenXC connectivity research platform as a sandbox to create and test innovative ideas in the newly announced
Many elements factor into personalized fuel efficiency including temperature, terrain, traffic conditions and individual driving styles. The goal of the challenge is to enable drivers to optimize their efficiency on the road and then share that information with others.
"We need to help customers understand the concept of personal fuel economy – based on their own individualized experiences – and give them tools to see, learn and act upon all the information available to know what to expect, how to improve, and even offer guidance in their shopping process," Farley added.
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