PORTLAND, Ore. (TheStreet) – How do you get a car buyer to stay loyal to a brand when they can't remain faithful to cars in general?
The U.S. auto industry reached 15.6 million vehicle sales in 2013 after bottoming out at 10.4 million in 2009. While the industry is on pace for 15.9 million sales this year, it's still well below the 17.4 million it rung up back in 2001. Auto sales are up more than 4% this year, but it's been an up-and-down summer for auto dealers coming off an August slump.
According to research firm Experian Automotive, the percentage of older vehicles on the road has reached its highest level since 2009. According to its most recent Automotive Market Trends analysis, vehicles predating the 2001 model year made up more than 28.3% of all vehicles on the road during the first quarter of 2014, up from 22.1% percent six years earlier. That's in line with Polk Automotive's finding that the average age of cars on U.S. roads is just over 11 years, but it's also revealing that drivers tend to stick with specific brands and vehicles when getting the most for their money.
Experian notes that the Ford F-150, Chevrolet Silverado 1500, Honda Accord, Toyota Camry and the discontinued Ford Ranger, Toyota Corolla and Honda Civic were the most popular vehicles of the model year 2000 and older that were still on U.S. roads in the first quarter of 2014. Those manufacturers should feel fortunate U.S. consumers are buying their vehicles at any age.
The Department of Transportation notes that drivers, who had been racking up a steadily increasing number of miles since the 1970s, started cutting back in 2008 and never returned to that peak. Traffic information service Inrix notes that as average gas prices started spiking in 2010, average commute times during peak hours dropped from more than four hours to less than two.
A study done by the Frontier Group and the U.S. Public Interest Research Group Education Fund found that the average U.S. driver actually started cutting back well before the recession, peaking around 2004 but dropping 6% by 2011. While the total miles driven in the U.S. rose 3.8% from 1948 to 2004, they've been flat since. Gas prices, disdain for the commute, a 4% drop in vehicle ownership since 2006 and a 4 percentage-point drop in licensed drivers since 1992 are all making arguments against the car that you just didn't hear from the bulk of U.S. consumers before the recession.
For automakers, that makes customer loyalty more essential than ever.
“Loyal customers provide a ready-made source of sales and constitute an important element of maintaining or expanding market share and profitability,” says Jeffrey Anderson, director of consulting and analytics for Experian Automotive.
We took at look at the results of Experian's Loyalty and Trends Market Report and found the 10 brands that earned the most return business in the United States. In a marketplace where loyalty isn't easy to come by, the following 10 companies have managed to distinguish themselves to customers who keep coming back for more.
Percentage of return customers: 34.1%
How loyal are Lexus customers? Let's put it this way: When much of the U.S. car-buying public was doing tuck-and-roll leaps out of Toyotas in the wake of the 2009 recalls and buying up cars with window stickers of a Hobbes-less Calvin defiling a Toyota logo, Lexus owners sat tight.
Sales remained steady through 2010 and didn't see a huge drop until an earthquake and tsunami in Japan disrupted production in 2011. They've recovered nicely, however, with Lexus car sales in the U.S. up nearly 19% through July from the same period in 2013 and truck sales up 15.4% during that same span. Sales of the flagship full-size ES are flat, but sales of the sporty new IS sedan have nearly doubled since July 2013. The CT hatchback (up 16% over the past year) and midsize GS (up 12%) are also chipping away as the GX (130% growth) and RX (4.9%) continue to claw back customers.
Lexus is up against some tough German competitors, but its loyal buyers have made it an incredibly resilient luxury brand.