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TechnoMetrica Auto Demand IndexAugust 2016

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TechnoMetrica Auto Demand Index – August 2016 Page 2

Table Of ContentsI. Methodology 3

II. Auto Demand Index 4-15A. Auto Demand Index (Overall)B. By RegionC. By Area TypeD. By AgeE. By Gender/Marital StatusF. By Parental Status and Race/EthnicityG. By Household IncomeH. Auto Sales ProgressionI. Slow Stochastic IndexJ. Auto Sales Channel (2011-2016)

III. Demand For New Autos 16-20A. Vehicle Purchase/Lease Plans: OverallB. Vehicle Purchase Plans: Purchase Likelihood Over TimeC. New Vehicle Purchase/Lease Time FrameD. Vehicle Types MomentumE. Preferred Vehicle Types 3SMA

IV. Brand Preferences 21-26A. Top Ten Brands Consumers Would Buy Today 3 SMAB. Brand Preferences Over Time 3 SMA (Top Ten Brands)

V. Contact Information 28


Methodology TechnoMetrica’s Auto Demand Index is a forward looking early (monthly) indicator of

consumers’ intent to purchase or lease a new vehicle within the next 6 months. The index has been set to an initial value of 100 based on demand levels between February 2007 and April 2007.

The Auto Demand Index is based on the responses Americans give to the question: – How likely is it that you will buy or lease a new vehicle within the next 6 months? Would you say

very likely, somewhat likely, not very likely or not at all likely?

We express purchase intent as an index score that varies as a linear function of the percentage of consumers who are either “very” or “somewhat” likely to purchase or lease a new vehicle within the next 6 months.

Higher index readings correspond to greater demand or intent to purchase/lease new automobiles.

The index and its movement is projectable to the national market for new automobiles, which consists of over 100 million U.S. households with drivers.

Each month, TechnoMetrica uses a monthly Random Digit Dial (RDD) telephone survey to collect the survey data, with a sample size of around 900 respondents. The margin of error is +/- 3.2 percentage points. The August Survey was conducted between July 29th and August 4th , 2016.


0

20

40

60

80

100

120

140

Au

g-14

Sep

-14

Oct

-14

No

v-14

De

c-14

Jan

-15

Feb

-15

Mar

-15

Ap

r-15

May

-15

Jun

-15

Jul-

15

Au

g-15

Sep

-15

Oct

-15

No

v-15

De

c-15

Jan

-16

Feb

-16

Mar

-16

Ap

r-16

May

-16

Jun

-16

Jul-

16

Au

g-16

Au

to D

em

and

In

de

x (A

DI)

Auto Demand Index (ADI) 3SMA

Auto Demand Index (Overall)Due to a number of recent economic developments, such as lower gas prices and an improving labor market, Americans’ intent to acquire new vehicles accelerated sharply this month. After declining 14 points, or 50%, in July, the Auto Demand Index level climbed 41 points this month to attain a score of 123, its highest reading since August 2015.

High Low

2010 97 56

2011 94 49

2012 105 49

2013 86 64

2014 88 73

2015 129 64

2016 123 82

Base = All Respondents

3SMA= Three Months Simple Moving Average


Auto Demand Index Moving AveragesBase = All Respondents

50

60

70

80

90

100

110

120

Aug-

14

Sep-

14

Oct-1

4

Nov-

14

Dec-1

4

Jan-

15

Feb-

15

Mar

-15

Apr-1

5

May

-15

Jun-

15

Jul-1

5

Aug-

15

Sep-

15

Oct-1

5

Nov-

15

Dec-1

5

Jan-

16

Feb-

16

Mar

-16

Apr-1

6

May

-16

Jun-

16

Jul-1

6

Aug-

16

3SMA 6SMA 12SMA

3SMA= Three Months Simple Moving Average

6SMA = Six Months Simple Moving Average

12SMA = Twelve Months Simple Moving Average

This month, the Auto Demand Index score surpassed all three of its moving averages, indicating that purchase intent will accelerate at a steady pace in the near future. August’s ADI topped both its 12-month and 6-month moving averages (102) by 21 points, and stands 22 points above its 3-month average of 101. After declining four straight months, the 3-month moving average increased by eleven points in August.

Auto

Dem

and

Inde

x (A

DI)


10

11

12

13

14

15

16

17

18

-8.0

-4.0

0.0

4.0

8.0

AutoSales

(Millions)

MACD Auto Demand Index (ADI) Auto Sales

Momentum: Moving Average Convergence DivergenceMomentum= Fast Average (6-month exponential moving average) minus Slow Average (12-month exponential moving average)

Base = All Respondents

After entering negative territory for the first time in 18 months in July, our momentum indicator (MACD) gained 3.9 points this month, registering a positive reading of 2.3. Accordingly, the Auto Demand Index will regain its positive momentum in the near future. Thus, TechnoMetrica anticipates that new vehicle sales will increase significantly in the coming months, driven by encouraging signs of an improving U.S. economy.

Diffe

renc

e be

twee

n 6

EMA-

ADI

and

12 E

MA-

ADI

Difference between 6 EMA auto sales and 12 EMA auto sales


By Region 3 SMABase = All Respondents

Q. How likely is it that you will buy or lease a new vehicle within the next 6 months?

116 116 104 103 101 100113

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

South

108120

106

8779 79

89

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Northeast

112125 135 127

97

7588

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Midwest

88 84 89 90108

95 103

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

West12 SMA = 9112 SMA = 107

12 SMA = 10712 SMA = 95


98 103 101 105 99

7991

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Rural

By Area Type 3 SMABase = All Respondents


116 118 116103 100

92105

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Suburban

105 111103 104

96 100 107

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Urban12 SMA = 99

12 SMA = 98

12 SMA = 107


By Age 3 SMABase = All Respondents


143 138 143 126 114100

126

0255075

100125150175200225

F-16 M-16 A-16 M-16 J-16 J-16 A-16

18-24

97108 105 101

90 7991

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

45-64

123 122 115 121 118 111 113

0255075

100125150175200

F-16 M-16 A-16 M-16 J-16 J-16 A-16

25-44

83 8780

67 71 7281

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

65+

12 SMA = 149

12 SMA = 7212 SMA = 96

12 SMA = 114


116 117105

111105 102

98

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Male

By Gender and Marital Status 3 SMABase = All Respondents


100 106 11096

9179

103

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Female

109 113109 108 103 95

110

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Married

108 112108 101

93 85 92

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Single

12 SMA = 104

12 SMA = 10612 SMA = 99

12 SMA = 99


By Parental Status and Race/Ethnicity 3 SMABase = All Respondents


128 134145 151

133 126138

0255075

100125150175200

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Parents

101 10595 88

8779

90

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Non-Parents

138 137 137 128 126112

125

0255075

100125150175200

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Black/Hispanic

100 103 100 9689 80 91

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

White

12 SMA = 133

12 SMA = 12412 SMA = 95

12 SMA = 92


By Household Income 3 SMABase = All Respondents


142149

132 123114 108

121

0

25

50

75

100

125

150

175

F-16 M-16 A-16 M-16 J-16 J-16 A-16

100K+

109120

116 110 10997

106

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

50K-100K

102 10295 88

75 70 68

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

30K-50K

91 92101 106 97

84102

0

25

50

75

100

125

150

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Under 30K12 SMA = 103

12 SMA = 12612 SMA = 103

12 SMA = 87


* The auto sales progression chart shows monthly sales in relation to the most recent 14 months. The high- low lines provide a comparison for the current sales with the most recent 14 months.

10.0

12.0

14.0

16.0

18.0

20.0

Jan-

11M

ar-1

1M

ay-1

1Ju

l-11

Sep-

11N

ov-1

1Ja

n-12

Mar

-12

May

-12

Jul-1

2Se

p-12

Nov

-12

Jan-

13M

ar-1

3M

ay-1

3Ju

l-13

Sep-

13N

ov-1

3Ja

n-14

Mar

-14

May

-14

Jul-1

4Se

p-14

Nov

-14

Jan-

15M

ar-1

5M

ay-1

5Ju

l-15

Sep-

15N

ov-1

5Ja

n-16

Mar

-16

May

-16

Sale

s (m

illio

ns)

Month

Auto Sales Progression

High(14)

Low(14)

Monthly Sales

Auto Sales Progression


Slow Stochastic Index

* The Slow Stochastic Index aids in identifying the tops and bottoms of auto sales.

Although momentum for the Slow Stochastic Index has slowed significantly in the past year, we anticipate that the Index has reached a turning point and will avoid bottom territory. Thus, auto sales should accelerate at a higher rate in the near future.


11.0

12.0

13.0

14.0

15.0

16.0

17.0

18.0

19.0

Jan-

11M

ar-1

1M

ay-1

1Ju

l-11

Sep-

11N

ov-1

1Ja

n-12

Mar

-12

May

-12

Jul-1

2Se

p-12

Nov

-12

Jan-

13M

ar-1

3M

ay-1

3Ju

l-13

Sep-

13N

ov-1

3Ja

n-14

Mar

-14

May

-14

Jul-1

4Se

p-14

Nov

-14

Jan-

15M

ar-1

5M

ay-1

5Ju

l-15

Sep-

15N

ov-1

5Ja

n-16

Mar

-16

May

-16

Sale

s (m

illio

ns)

Date

Auto Sales Channel (2011-2016)

EMA(8)

Standard Dev. +3

Standard Dev. -3

Sales

*The sales channel indicates whether there is an upward or a downward trend. The upper channel is 3 standard deviations above the 8-month EMA and the lower channel is 3 standard deviations below the 8-month EMA.


Likely20%

Not Likely80%

Vehicle Purchase PlansBase = All Respondents

0%

5%

10%

15%

20%

25%

Aug-

14

Sep-

14

Oct

-14

Nov

-14

Dec-

14

Jan-

15

Feb-

15

Mar

-15

Apr-

15

May

-15

Jun-

15

Jul-1

5

Aug-

15

Sep-

15

Oct

-15

Nov

-15

Dec-

15

Jan-

16

Feb-

16

Mar

-16

Apr-

16

May

-16

Jun-

16

Jul-1

6

Aug-

16

Likely 3 month SMA

August 2016

This month, the share of Americans whosay they are likely to purchase or lease anew vehicle within the next six monthsincreased by six points from July, to arate of 20%. This represents the highestpercentage of Americans planning toacquire a new vehicle since January ofthis year.

Vehicle Purchase Plans Over Time


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Within 1 Month Between 2 and 3 Months Between 4 and 6 Months Not sure

Vehicle Purchase/Lease Time FrameAugust 2016 Base = Potential Buyers

Nearly one in five drivers who are likely toacquire a new vehicle (17%) report that theywill do so within one month, a gain of fivepoints from July. Meanwhile, 12% of likelybuyers say they will make a purchase within thenext 2 to 3 months, with seven in ten reportingthat they are planning to do so further out(within 4 to 6 months).

Q. Will you make your purchase within the next month, 2 to 3 months, or in 4 to 6 months?

In August, the share of likely vehicle buyers planning to purchase orlease a new vehicle within one month improved by five points fromthe previous month, to a rate of 17%.

Average Time Frame

(Months)

Feb-16 4.35

Mar-16 4.25

Apr-16 4.15

May-16 4.21

Jun-16 4.00

Jul-16 4.06

Aug-16 4.03

17%

12%70%

Within One Month

Between 2 & 3 Months

Between 4 & 6 Months

Not Sure

4%


Negative Change Positive Change

Vehicle Type MomentumAugust 2016 Base = Potential Buyers

Q. What type of vehicle are you most likely to buy or lease?

No Change

24%

14%

9%6%

3%

11% 12%

15%

21%

11%8%

6%

3%

12%14%

17%

Mid-Size Compact Large SUV Minivan Sub-Compact or Mini

Pickup Full-Size Small SUV

12SMA 3SMA


14% 13%13%

13% 13%11% 11%

0%

10%

20%

30%

40%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Compact

Preferred Vehicle Types Over Time - 3 SMABase = Potential Buyers

1%2% 3% 3% 3% 3% 3%

0%

10%

20%

30%

40%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Subcompact/Mini

27%23% 23% 21% 21% 20% 21%

0%

10%

20%

30%

40%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Mid-Size

11% 11%13% 13% 12% 13% 14%

0%

10%

20%

30%

40%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Full-Size

12 SMA = 3 12 SMA = 14

12 SMA = 1212 SMA = 24


Base = Potential Customers

7% 8% 8%6% 5% 5% 6%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Minivan

11%12%

11% 12% 11% 14% 12%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Pickup

14%17% 16% 16% 17% 17% 17%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Small SUV

10% 10% 10% 11%10% 8% 8%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Large SUV

12 SMA = 6 12 SMA = 11

12 SMA = 912 SMA = 15

Preferred Vehicle Types Over Time - 3 SMA


Top Ten Brands Consumers Would Buy TodayAugust 2016 Base = Likely Buyers

*Sorted by 3SMA

13%15%

12%10%

4% 4% 3%2%

3% 3% 2%

15%12% 11%

9%

5% 4% 3% 3% 3% 3% 3%

Toyota Ford Chevrolet Honda Nissan GMC Mercedes-Benz Cadillac Dodge Subaru Kia

12 Month Average 3 Month Average


11% 11%13% 12%

14% 15% 15%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Toyota

12%10% 11% 9% 9% 8% 9%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Honda

12% 12% 11%13% 12%

15%11%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Brand Preference Over Time 3 SMA (Top 4 Brands)Base = Likely Buyers

17% 16% 15% 15% 14%12% 12%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Ford

12 SMA = 13

12 SMA = 1012 SMA = 12

Chevrolet

12 SMA = 15


1% 2% 2% 1% 1% 2% 3%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Cadillac

3% 3% 3%2% 3%

2%3%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Mercedes-Benz

5% 4% 4% 3% 4%3% 4%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

GMC

4% 4% 4% 4% 4% 4% 5%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Nissan

Brand Preference Over Time 3 SMA (Brands 5 to 8)Base = Likely Buyers

12 SMA = 4 12 SMA = 4

12 SMA = 3 12 SMA = 2


4% 3% 3% 3% 4% 4% 3%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Dodge

2% 2% 1% 2% 2% 2%3%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Kia

3% 4% 3% 3%2% 2% 3%

0%

10%

20%

30%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Subaru

Brand Preference Over Time 3 SMA (Brands 9, 10, & 11)Base = Likely Buyers

12 SMA = 3 12 SMA = 3

12 SMA = 2


By Vehicle OriginAugust 2016 Base = Likely Buyers

Q. If you were to buy a vehicle today, what brand would you buy?

43%37%

10%

38% 40%

12%

American Asian European

Likely to Purchase by Origin


0%

10%

20%

30%

40%

50%

60%

F-15 M-15 A-15 M-15 J-16 J-16 A-16European Asian American


Luxury vs. Non-LuxuryAugust 2016 Base = Likely Buyers

Q. If you were to buy a vehicle today, what brand would you buy?

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

F-16 M-16 A-16 M-16 J-16 J-16 A-16

Luxury Non-Luxury

14%

76%

10%16%

73%

11%

Luxury Non-Luxury Not Sure

Brand Preference: Luxury vs. Non-Luxury



Conclusions Vehicle purchase intent among Americans improved sharply this month, as consumers displayed greater confidence in the overall U.S.

economy, due to such positive developments as steady jobs growth, declining gas prices, and low interest rates. After falling fourteen points in July amid Brexit fears, the Auto Demand Index level gained 41 points this month to attain a score of 123, its highest reading since August 2015.

The Auto Demand Index score topped each of its short- and long-term moving averages this month, indicating that purchase intent will accelerate sharply in the near future. August’s ADI eclipsed both its 12-month and 6-month moving averages (102) by 21 points, while supassing its 3-month average of 101 by 22 points. After declining four straight months, the 3-month moving average increased by eleven points in August.

The Index regained its positive momentum in August, as our momentum indicator, which entered negative territory for the first time in 1 ½ years last month, grew by 3.9 points to a score of 2.3. Thus, we anticipate that new vehicle sales will increase significantly in the coming months, driven by encouraging signs indicating an improving U.S. economy.

Regarding demographics, purchase intent grew among 21 of the twenty-three segments that TechnoMetrica tracks on a monthly basis. Millennials aged 18 to 24 and women drivers posted the largest increases in purchase intent this month, as the groups’ ADI scores gained 26 points and 24 points, respectively. Intention to acquire a new vehicle was also stronger among Americans earning less than $30K in annual income, a segment that registered an eighteen point climb in the Index. Meanwhile, consumers earning an income between $30K and $50K and the male demographic represented the only two groups that posted declines in purchase intent.

This month, the share of consumers who indicated that they were likely to acquire a new vehicle in the next six months increased by six points from July, to 20%. This represents the highest percentage of Americans planning to purchase a new vehicle since January of this year. Regarding vehicle preference, mid-size vehicles and small SUVs remain the most desired vehicle types among likely buyers, while preference for full-size vehicles displayed accelerated growth among consumers.

Among Americans intending to acquire a new vehicle in the near future, Toyota reclaimed its spot as the most preferred brand in August, garnering a 15% share of likely buyers. Meanwhile, Ford, the choice brand of 12% of prospective buyers, improved one position to claim second place this month. Preference for Chevrolet vehicles (11%) declined by four points in August, as the brand slips from the top position to take third place. Regarding the land of origin of the vehicles that consumers intend to purchase, Asian brands surpassed American-made vehicles in consumer preference. Close to half of likely buyers (46%) intend on acquire Asian autos, while 35% plan on acquiring vehicles made in America.


Contact Information

To request a full data set or for any questions, please contact us.

Contact: Raghavan Mayur

Address: 70 Hilltop Road, Suite 1001Ramsey, NJ 07446

Phone: 800-328-TECH (8324)201-986-1288

Fax: 201-986-0119

Email: [email protected]

Web: www.technometrica.com

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