2005 Automotive Emerging Technologies Study: The study describes preferred emerging technologies, as ranked by consumers. The technologies are ranked top to bottom according to the overall interest consumers have (a combination of definite plus possible interest before pricing is known). The right-hand column lists the ranking for each, once consumers know the pricing of a technology.
(Table: JD Powers & Associates)
According to J.D. Power and Associates, premium surround sound systems and high-definition (HD) radio are highly attractive features consumers would like to see in their new vehicles based on their estimated market prices. Furthermore, consumers prefer to pay a one-time fee over a monthly subscription for satellite radio.
While consumer interest in new technologies typically drops after a price point is revealed, relative interest in premium surround sound and HD radio actually improves dramatically after consumers learn the market price. Premium surround sound, which ranks sixth in consumer interest before the price is revealed, moves to second after consumers learn its market price is $400. With a realistic market price of just $150, the HD radio-compatible receiver jumps from 16th in initial interest to third after pricing is revealed.
"What is truly surprising is that among those interested in equipping their next new vehicle with the premium surround sound feature at $400, nearly 80 percent of those are willing to pay $800 for a branded system," said Lawrence Wu, senior director of automotive emerging technologies at J.D. Power and Associates. "This suggests that automakers and audio suppliers could add value to their products for consumers, while increasing their returns. While we have seen the availability of branded sound systems increase the past few years, it's evident from this research that there is sufficient consumer demand to warrant equipping a much broader vehicle segment base."
Consumers still express more interest in satellite radio than HD radio prior to the knowledge of the price. However, interest for satellite radio falls below HD radio when they learn satellite radio's market price is $12.95 per month.
"Even though satellite radio is at an advantage over HD radio by offering commercial-free content and coast-to-coast coverage, interest in HD radio is higher than satellite radio after the introduction of price," said Wu. "In general, consumers would rather pay once for a feature and have been reluctant to embrace subscription fees. This is evident in the trade-off exercise in this year's study in which almost twice as many consumers chose lifetime [life of vehicle] satellite radio with a one-time $499 subscription fee compared to a one-year option."
Safety related technologies are still a top priority for consumers. The study finds consumers' four most desired features relate to enhancing the safety and/or security of vehicle occupants. Run-flat tires were the most desired item among technologies included in the study before consumers were shown the fair market value. Night vision, stability control and blind spot warning follow run-flat tires in consumer interest before prices are introduced. Tires drop to fourth after its $600 price is revealed. Consumer interest in night vision decreases significantly once consumers are presented with the realistic market price of $1,500.
An understanding of the consumer interest trends enables manufacturers, suppliers and installers to plan sales and marketing campaigns, as well as manage their inventories.
(Source: J.D. Powers &
Associates)
