Loyalty More Than Skin Deep For Some Automotive Brands

Posted by: David Kiley on January 21, 2009

Loyalty to cars has not gone out of style as the annual Polk Loyalty Awards prove.

General Motors, despite the bad press, led all manufacturers by retaining 62.5% of its owners who bought cars in 2008. While there are plenty of reasons for GM customers to re-up, one undeniable factor in helping keep the number high is resale value and rebates. Some GM vehicles depreciate faster than imports. It’s a real factor at retail. And if you take a Chevy or Pontiac you want to trade, or still owe money on, to a dealer, GM dealers are going to give you the most consideration on the car. Take a Pontiac Grand Prix to trade at a Honda dealer, and see how much consideration or incentive money you get. Zip. That dealer doesn’t want the car.

So, while GM is making a lot of great cars and trucks today—Malibu, Aura, Silverado, Tahoe—some of its inglorious past of over producing mediocre vehicles, which leads to fast depreciation, is actually a factor in giving its loyalty rate a positive bump.

That said, I’d be remiss if I didn’t mention some of the vehicles that keep customers coming back because of sheer quality and deserved brand loyalty. Silverado pickup retained 32.77% of customers, best among pickups. Chevy Suburban retained 20.42%, best among full-sized SUVs. Corvette led luxury sports cars with 23.9%. Chevy Impala led the full-size car segment with 34% (This is the one I question, and how much of this might be impacted by fleet buyers, because the full-sized category is very fragmented with cars that get no advertising and hardly any fleet business, like Hyundai Azera and Toyota Avalon. Though I might have expected to see Chrysler 300 here).

Honda led all nameplates with 56.5%. Subaru Forester led all compact SUVs with 32.5%. As I have been personally shopping for a used car, I can say that one of the things that keeps Forester buyers coming back is not only the snow-shoe capability of the car, but the strong resale. I am astonished at some of the used car prices I see on Foresters.

Ditto Toyota Tacoma, which kept 18.1% of its buyers. Shopping for a used Tacoma is an eye opener. Its resale value remains astonishingly high given the aggressive discounting of full-sized pickups, including the Toyota Tundra.

Toyota in general does great with ethnic consumers, especially Latinos. Toyota manages to keep 54.5% of ethnic buyers one year to the next. Wow.

Reader Comments

Chief Enterprises | America's provider of Bosch Relays, Solenoids, Connectors, and Diodes

January 23, 2009 5:29 AM

Loyalty is the important factor in the automobile industry. Many people are looking for the loyalty more than the maintenance. But when importing or exporting these type of auto brands, will it be good in this industry?

Wes

February 2, 2009 1:28 PM

I continue to buy GM cars. I do agree, I'm loyal to them because I am familiar with them, the workings of the accessories, the engines, etc. I've also been very pleased with the reliability in general.

Next time I'm not certain though. GM took a huge bailout. I'm disinclined to buy Ford, so they bailout of the US auto industry has the effect of pushing me to buy a foreign make.

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