Gas mileage concerns influence potential SUV buyers

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Approximately 15% of new-vehicle buyers reject a model due to its gas mileage, according to the 2004 J.D. Power and Associates Escaped Shopper Study.

The study, which examines the reasons new-vehicle shoppers consider, but reject, a vehicle, reveals that fuel economy is particularly influential among those who seriously consider a full-size SUV model: 22% said they reject a particular model due to gas mileage concerns.

Nearly 40% of those shoppers who reject a full-size SUV due to gas mileage ultimately purchase a mid-size SUV instead, while nearly

20% purchase another model in the segment.

"As long as gas prices remain high, gas mileage will continue to be an important factor that buyers consider when shopping for a new vehicle," says Scot Eisenfelder, vice president of the retail automotive practice at J.D. Power and Associates.

"However, SUVs are still a popular choice among buyers. While SUV shoppers keep gas mileage in mind, a large proportion of them still buy another SUV, albeit a smaller one, when the one they first considered didn´t meet their standards for fuel efficiency."

There also is evidence that the extended incentive wars are shaping customer expectations as well, as an increasing number of shoppers reject models because they do not have sufficient rebates.

According to the J.D. Power study, close to 18% of shoppers reject a model due to insufficient rebates, up 2% vs. 2003. Domestic models are rejected more frequently than import models based on insufficient rebates (20% vs. 17%, respectively), despite higher average rebates offered by domestic brands.

"While shoppers are always keen on a good deal, manufacturers with the most attractive incentive offers are often still rejected based on a perception of inadequate rebate or finance incentives," says Eisenfelder.

"Many shoppers who reject one brand because it lacks incentives end up buying another brand that traditionally doesn´t offer substantial rebates. This is a good example of how product attributes, which are typically highly important to shoppers, can outweigh financial incentives."

Twenty-eight new model introductions were included in the 2004 study.

"With an increase in new-model launches over the next few years, it will become increasingly difficult for older models to gain a place on the shopping list," adds Eisenfelder.

The 2004 Escaped Shopper Study is based on responses from 28,719

new-vehicle owners.

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