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American Consumers Backing Off Japanese, Korean Vehicles

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On: Tue, Apr 19, 2011 at 7:47AM | By: Chris Weiss


American Consumers Backing Off Japanese, Korean Vehicles

The saying that "image is everything" is rarely off the mark. In the case of the Japanese auto industry, it's that very principle that's starting to allow the carriage to lead the horse.

After suffering a devastating trio of disasters early last month, the Japanese auto industry has been having well publicized struggles in procuring automotive parts and keeping production running on schedule. There have been numerous shutdowns and slowdowns, and problems are expected to continue for months to come.

As if those direct problems weren't enough, now Japanese automakers face a rather serious indirect problem: U.S. consumers are backing off of Japanese vehicles because of all the news that they're reading about parts shortages, production slowdowns, and rising prices.

The information comes from a report created by market research firm TNS. In interviewing American consumers, the firm found that 25 percent of those surveyed are less likely to purchase Japanese vehicles. Actually, in one of those face-palm-worthy moments, those 25 percent said they were less likely to buy Japanese or Korean vehicles, failing to distinguish between Korean brands like Kia and Hyundai and Japanese brands like Toyota and Honda. We'll give them a pass since 'Honda' and 'Hyundai' have always been a bit too close for comfort.

In terms of why they're backing away, 46 percent of those that responded that way said they were concerned with the potential lack of parts for those vehicles. A lesser but still significant 37 percent were concerned that prices will be too high as a result of decreased production.

TNS' study showed that people expect that the world's biggest auto brand—Toyota—will experience the worst impact from the disasters in terms of automakers, followed by Honda, Mitsubishi, Nissan, and Mazda.

Previously, it looked like Korean brands Kia and Hyundai were set to benefit from the problems in Japan. The Korean companies were not experiencing parts-supply or production issues and there was no fear of rising prices. It was thought that consumers would turn to these brands as supplies of Japanese vehicles diminished and prices rose. But, as we stated at the start, image can be more important than reality.

TNS' VP William Bruno suggests that automakers and dealers get on top of that image as soon as possible: "The communications strategy needs to address this issue of confusion vis-à-vis sourcing. It can't only come from the companies, it has to come from dealers. And those brands that have not been impacted by the disaster should be sure to reaffirm this with their target customers through advertising and dealer communications programs."




Comments

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Aiu | 7:16PM (Mon, Jun 25, 2012)

find that hard to believe mate. I lived in Seoul for 10 years. After a while you tend not to look but evdryeay i saw hot fit birds everywhere If you are saying that only 5 are hot and the rest ugly, your standards must be VERY VERY high!!! Otherwise you have a huge grudge hate the Koreans, or you were in your hotel room all the time. But good luck to you mate. All the best Each to thier own .



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