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Car Purchasing Process - Canada - August 2019

Covered in this report

This report explores how auto manufacturers, car dealers as well as car research and vehicle inventory websites can contend in an increasingly competitive space, particularly for players looking to pick up incremental sales or those looking to defend their current share of the marketplace.

"The test drive remains essential in the car buying process but many are turning to online research, including reviews submitted by consumers as well as professionals in the field. Most consumers are performing research on incentives, car performance and car features, making them well informed before they visit a dealership. Maintenance costs are a prime concern among consumers with many also feeling that buying a vehicle is a stressful process."
- Andrew Zmijak, Research Analyst

This Report will cover the following areas:

  • Maintenance costs are a key concern
  • Most are performing their research and will be prepared
  • The car purchasing process is stressful to most
  • New vehicles are most likely to be considered
  • Fathers are a prime target group
  • A return policy resonates with consumers

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Table of contents

  1. Overview

    • What you need to know
      • Definitions
      • Executive Summary

        • The issues
          • Maintenance costs are a key concern
            • Figure 1: Cost-related attitudes towards the car purchasing process, June 2019
          • Most are performing their research and will be prepared
            • Figure 2: Types of vehicle information researched, June 2019
          • The car purchasing process is stressful to most
            • Figure 3: Stress and trust-related attitudes towards the car purchasing process, June 2019
          • The opportunities
            • New vehicles are most likely to be considered
              • Figure 4: Type of vehicle purchase, June 2019
            • Fathers are a prime target group
              • Figure 5: Vehicle purchase plan, fathers with under-18s in the household vs overall, June 2019
            • A return policy resonates with consumers
              • Figure 6: Select attitudes towards the car purchasing process, June 2019
            • What it means
            • The Market – What You Need to Know

              • Strong sales in past years will likely level out in near future
                • Interest rates remain low but could creep up
                  • Fluctuating gas prices could alter purchase decisions
                    • The potential effects of removal of rebates on EVs and hybrids in Ontario
                    • Market Factors

                      • Strong sales in past years will likely level out in near future
                        • Figure 7: Volume of registrations, Canada, 2014-18
                      • Interest rates remain low but could creep up
                        • Fluctuating gas prices could alter purchase decisions
                          • Figure 8: Average retail prices for regular gasoline in Canada, 2016-19
                        • The potential effects of removal of rebates on EVs and hybrids in Ontario
                        • Key Players – What You Need to Know

                          • Hyping up new tech features
                            • Toyota’s Red Tag Days
                              • Partnerships are cutting costs and enabling new models
                                • Ride share/hailing services can diminish the need for a vehicle
                                  • Industry disrupters
                                  • Marketing and Advertising

                                    • Hyping up new tech features
                                      • Figure 9: Mazda Canada, informational email, March 2019
                                      • Figure 10: Atlantic Toyota Dealers, acquisition mail, May 2019
                                    • Toyota’s Red Tag Days
                                      • Figure 11: Atlantic Toyota Dealers, acquisition mail, May 2019
                                      • Figure 12: Northside Toyota, acquisition mail, April 2019
                                      • Figure 13: Toyota Canada, loyalty mail, May 2019
                                    • Low interest rates continue to attract
                                      • Figure 14: Mitsubishi Motor Sales of Canada, acquisition mail, June 2019
                                      • Figure 15: Mitsubishi Motor Sales of Canada, acquisition mail, June 2019
                                  • What’s Working?

                                    • Partnerships are cutting costs and enabling new models
                                      • Electric and hybrid vehicles are gaining ground
                                      • What’s Struggling?

                                        • Sedans and coupes are struggling against SUVs and crossovers
                                          • Ride share/hailing services can diminish the need for a vehicle
                                            • Figure 16: Kona | The SUV for the city | Hyundai Canada, May 2019
                                        • What’s Next?

                                          • Progressing the dealership experience
                                            • Tools empowering car shoppers
                                              • Industry disrupters
                                              • The Consumer – What You Need to Know

                                                • Half of Canadians plan on buying a vehicle in the next three years
                                                  • Most are considering a new vehicle
                                                    • Future purchases are well thought out
                                                      • Most plan on researching incentives, car performance and features
                                                        • A test drive still remains critical in the car purchasing process
                                                          • Maintenance costs are a prime concern
                                                          • Vehicle Purchase Plan

                                                            • Half of Canadians plan on buying a vehicle in the next three years
                                                              • Figure 17: Vehicle purchase plan, June 2019
                                                              • Figure 18: Vehicle purchase plan, by gender, June 2019
                                                            • Reaching fathers is critical
                                                              • Figure 19: Vehicle purchase plan, father with under-18s in the household vs overall, June 2019
                                                              • Figure 20: Select attitudes towards the car purchasing process (% any agree), fathers with under-18s in the household vs overall, any agree, June 2019
                                                            • Purchase intentions higher among younger consumers
                                                              • Figure 21: Vehicle purchase plan, by age, June 2019
                                                              • Figure 22: Summer of Jeep | Wrangler | Ride Swap, July 2019
                                                            • New vehicles are most likely to be considered
                                                              • Figure 23: Type of vehicle purchase, June 2019
                                                              • Figure 24: Hyundai, certified pre-owned, mobile ad, June 2019
                                                          • Pre-purchase Decisions

                                                            • Consumers are well aware of what they want in a vehicle
                                                              • Figure 25: Pre-purchase decisions, June 2019
                                                            • Older consumers are more confident in the type of vehicle they want
                                                              • Figure 26: Pre-purchase decisions, 18-44s vs over-45s, June 2019
                                                          • Vehicle Research

                                                            • Most plan on researching incentives, car performance and features
                                                              • Figure 27: Types of vehicle information researched, June 2019
                                                            • Competitive pricing tops incentives research
                                                              • Figure 28: Car features research, June 2019
                                                            • Fuel efficiency trumps engine performance
                                                              • Figure 29: Car performance research, June 2019
                                                            • Safety features resonate most with consumers
                                                                • Figure 30: Car features research, June 2019
                                                              • The test drive remains key in the car purchasing process
                                                                • Figure 31: Research behaviours, June 2019
                                                                • Figure 32: Research behaviours, 18-44s vs over-45s, June 2019
                                                              • Strong parallels between taking a test drive and word of mouth
                                                                  • Figure 33: TURF Analysis – Research behaviours, June 2019
                                                                  • Figure 34: Table – TURF Analysis – Research behaviours, June 2019
                                                                • Methodology
                                                                • Attitudes towards the Car Purchasing Process

                                                                  • Maintenance costs are a prime concern
                                                                    • Figure 35: Cost-related attitudes towards the car purchasing process, June 2019
                                                                  • Buying a vehicle is stressful for most
                                                                      • Figure 36: Stress and trust-related attitudes towards the car purchasing process, June 2019
                                                                    • A return policy should be highly considered
                                                                      • Figure 37: Select attitudes towards the car purchasing process, June 2019
                                                                    • Word of mouth can be powerful
                                                                      • Figure 38: Select attitudes towards the car purchasing process, June 2019
                                                                  • Appendix – Data Sources and Abbreviations

                                                                    • Data sources
                                                                      • Consumer survey data
                                                                        • Consumer qualitative research
                                                                          • Abbreviations and terms
                                                                            • Abbreviations

                                                                            Car Purchasing Process - Canada - August 2019

                                                                            £3,435.47 (Excl.Tax)