Shoppers expect “fast payback” on vehicle price increases
Palo Alto, California, USA — Market Insight Corporation today revealed that most automobile shoppers will not accept increased vehicle prices associated with the “54.5 mpg” targeted fuel economy initiative. Shoppers are only willing to pay more if price increases can be “paid back” by fuel cost savings within about eighteen months of purchase. Since today’s alternative fuel technologies add significantly to the cost of a vehicle, “54.5” is outside the payback range of what consumers will currently accept, if given a choice.
Based on preferences collected from more than 27,000 consumers visiting MyProductAdvisor.com from March through July 2011, “small car” segment shoppers are willing to pay only about $900 more for a vehicle that achieves the government targeted fuel economy of 54.5 mpg compared to a vehicle at 30 mpg. “Understanding the sentiment of real shoppers is essential to developing actionable consumer insights,” said Rich Falcone, President & CEO at Market Insight.
Increased gasoline prices would make shoppers more willing to pay larger premiums for enhanced fuel efficiency. However, analysis also shows that at times of high gasoline prices, consumers will generally reduce their spending on new vehicles, fuel efficient or not. “Shopper preference constantly changes, influenced by market dynamics; so access to real-time, on-demand data and intelligence is crucial for effective decision-making,” said Falcone.
About Market Insight Corporation (MyProductAdvisor)
MyProductAdvisor (MPA) is a consumer facing website that continuously gathers auto shopper preferences for specific product features and attributes. MPA delivers unbiased buying recommendations to shoppers. The preferences MPA collects fuel a powerful, on-demand consumer research intelligence system and predictive market simulation engine. Enterprise companies utilize this intelligence to enhance decision making and planning. Market Insight Corporation, established in 2003, is the company behind MPA.