Report: Customer Loyalty to Utility Vehicles Reaches Record Levels
Customer loyalty to utility vehicles continues to grow at record levels, according to IHS Markit.
Customer loyalty to utility vehicles continues to grow at record levels, according to a recent analysis by IHS Markit, a business information provider. The analysis of 17.1 million new vehicle registrations in 2017 proves loyalty to utility vehicles reached a record high of 66.9 percent last year, up from 64.4 percent in 2016 and 54.3 percent in 2012.
This trend is expected to continue as utility and pickup registrations grow steadily at the expense of sedan registrations. The report forecasts that over the next three years, there will be five times as many new utility nameplates introduced to the U.S. market as new sedans.
“Not only do utilities offer an attractive combination of benefits not available with sedans, but the broad range of utilities available, whether it be based on size, price or technology, now rivals the choice among sedans and continues to grow,” says Tom Libby, loyalty principal of IHS Markit.
Two out of three households with a utility vehicle that returned to market in 2017 acquired another utility vehicle. Utility loyalty is 14.6 percentage points higher than the industry average loyalty of 52.3 percent.
Pickup truck loyalty rose in 2017, measuring 50.6 percent, up. 8.1 percentage points since 2012. Meanwhile, sedan loyalty has fallen to 47.7 percent in 2017, down 8.5 percentage points since 2012. This is the furthest drop of all body types over the five-year period.
The analysis included new vehicle transactions that took place between January 2012 and December 2017. The utility body style defined in the study includes SUV and CUV models. Loyalty rates are based on the propensity of a household returning to market to acquire the same body style previously owned. The second vehicle may be an addition to a household or a replacement.
IHS Markit offers information, analytics, and solutions for major industries and markets.