Auto Trends: Average Age of Cars is 11.4 Years

IHS Automotive issues latest snapshot of vehicles in operation.

Chevrolet Corvair convertible
Classic cars such as this Chevrolet Corvair convertible
are among the vehicles Americans still drive today.

That aged clunker you are driving might be in good company after all. On Monday, IHS Automotive released its latest analysis of the 252 million passenger vehicles registered in the United States and found that the average age for this “fleet” is 11.4 years as of 2013. That number has held steady, the first time in five years that the average age did not increase.

IHS Automotive VIO

IHS Automotive (inclusive of Polk) says that there are more than 252,700,000 light vehicles in operation (VIO) in the United States, increasing by 3.7 million in 2013. Two reasons for the rise in registered vehicles are: an increase in automotive sales for 2013 and a decrease in scrappage rates. Scrappage describes automobiles that are discarded, with registrations canceled and the cars sent to junkyards.

IHS data also separates cars from light duty trucks. In both categories the average age was 11.4 years, reflecting a slight increase in the age of pickup trucks.

“In our history of tracking, we have seen a gradual increase in the average age of vehicles on the road,” said Mark Seng, director, aftermarket solutions and global aftermarket practice leader at IHS Automotive. “This year, we’re seeing somewhat of a plateau in the market, and expect it to remain over the next few years, without a major change in either direction. We attribute this to a number of factors, including the economy and the increasing quality of today’s automobiles.”

That increased quality has consumers shopping for cars that they intend to keep for many years, perhaps much longer than what they would have considered a generation ago. Indeed, consumers are also financing their cars longer, with 72-month auto loans now commonplace.

auto loans

Rising Average Age

IHS forecasts that the average age of passenger vehicles will continue to rise, hitting 11.5 years in 2017 and 11.7 years in 2019. Notably, the volume of vehicles aged 0 to 5 are expected to increase by 32 percent over the next five years while vehicles aged 6 to 11 will decline by 21 percent. Vehicles that are at least 12 years old are expected to increase by 15 percent by 2019.

The latter figure will most likely be of interest to aftermarket companies and repair outlets. The first group may look for ways to help consumers keep their cars relevant, by selling to them navigation systems, backup cameras and security systems not found in older cars. The second group is composed mostly of garages and mechanics, the people that can keep old vehicles functioning for many years.

Average Price New Car

Another factor that may be keeping many Americans out of the new car market is the average price of a new car. That average price was $32,086 in 2013 reports AOL Autos although we on Auto Trends have found quite a few new models ranging in price from $15,000 to $20,000. Small cars all, but within the price range of many new car shoppers.


Fiat 500L Trekking

Fiat makes cars that are on the lower end of the price spectrum.


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Let’s Build 100 Million Cars Per Year!

Ambitious automotive sales forecast: will it hold up?


sales increase

Following the Great Recession, global auto sales have rebounded
and are in record territory. IHS Automotive forecasts
that will soon pass the 100 million mark in annual sales.

Many people know that the US auto industry is capable of building 16 to 18 million cars annually. They may also know that China’s car buying market is now larger than the US and has been that way since the last recession. Together, the two markets compose a significant number of the 85 million passenger vehicles that are expected to be built this year around the globe.

China Leads the Way

Further worldwide growth is anticipated with IHS Automotive forecasting an additional boost of 21 million units through 2021. According to projections, China should account for more than half that increase. Additional growth is expected in Europe and in North America, but production is expected to drop in South Korea and Japan as manufacturers spread production globally.

IHS’ findings were released in advance of a Berlin automotive forum that it is hosting beginning today and runs through Wednesday. This forum will analyze national, regional and global markets, deciphering trends and discussing sales projections.

For instance, European demand is expected to shift eastward although the IHS says that growth in Russia and Turkey will fall to about 1 percent this year. At present, western Europe accounts for 70 percent of European new car demand, but that will fall to 50 percent by 2021.

Shifting European Demand

European production is expected to rise four percent annually beginning next year and continuing through 2017 as exports to the United States and China help fuel that demand. Demand in Italy and Spain is also expected to rise as those nations continue to recover from the last recession.

“European car makers will meet divergent demand environments, depending on which part of Europe they are more exposed to,” said Denis Schemoul, manager Europe vehicle production forecasting, IHS Automotive. Schemoul, along with Mark Fulthorpe, director of global vehicle production forecasting at IHS Automotive will conduct a joint presentation on Tuesday. About the shifting market Fulthrope noted that emerging markets are impacting segment demand while mature markets are downsizing.

What Car Manufacturers are Forecasting

Car manufacturers have been releasing rosy sales projections in recent months in anticipation of further growth. Fiat Chrysler devoted an entire day last week to outline its growth strategy, projecting a 60 percent sales increase through 2018. Subaru has forecast a 20 percent sales increase through 2020 with US sales outstripping combined demand elsewhere.

To meet demand, new factories are cropping up around the world and existing plants are being refurbished and expanded. Even so, manufacturing plants are being closed in Australia as automakers respond to the high cost of production there. Similarly, OEMs in Japan and South Korea are also cutting back, while increasing production in markets where growth is strong.

Volkswagen Rising

Car manufacturers have long made projections for where they would like to see their businesses in five or 10 years, even longer.

In 2008, the Volkswagen Group publicly outlined Strategy 2018, an effort designed to move the German automaker into the No. 1 sales position worldwide. As of 2013, VW still trailed Toyota and GM, but it has been closing the gap through by boosting sales in China and through expanding production of its highly profitable brands, including Porsche and Audi. Even so, Volkswagens competitors are not rolling over, with each one also fighting for a larger slice of an expanding sales pie.


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IHS Automotive: Sharp Increase in Electric Vehicles Forecast

Battery prices fall, making EVs more affordable.

IHS Automotive: BMW i3

BMW i3 is one of several new EV models for 2014.


Electric vehicle adoption continues to grow and 2014 could provide its biggest boost yet, rising by a projected 67 percent for the year. Thats the forecast of IHS Automotive, the business information, insight, and analysis firm that acquired Polk in 2013.

IHS Automotive Forecast

Behind the surge in demand are tighter emissions standards in Europe and increased production including new models from BMW and Fiat. IHS estimates that the total global production of EVs for 2014 will come in at 403,000 units, a number that includes pure electric (electric only) and plug-in electric hybrid vehicles (PHEVs).

The projected increase builds on the 44 percent surge seen in 2013. It also far outpaces the estimated 3.6 percent rise in worldwide production for all vehicles expected for 2014.

And demand is expected to rise across the globe with North and South America generating 30 percent of the share to 40 percent for Europe, Africa and the Middle East. The remaining 30 percent share estimate was for Asia and the Pacific region.

IHS Automotive: Tesla Motors

Tesla is supporting its cars with a global charging network.

Euro 6 Legislation

In Europe, tighter emissions standards come into play in the second half of the year, under the European Commissions new Euro 6 legislation. Ben Scott, analyst for IHS Automotive, noted that manufacturers are lining up with new models to serve consumers beyond the aforementioned BMW i3 and Fiat 500e.

And the expanded product line up should generate a corresponding increase in interest for EVs. Besides Fiat and BMW, the Audi A3 PHEV, Volkswagen e-Up!, and the Mercedes-Benz B-Class Electric are also new to the market. These models will be supported by a broadened electric vehicle charging station network that will add 35,000 charging units to the worldwide pool for 2014.

AC and DC Chargers

New types of chargers are entering the market too and include those that satisfy AC-Type 2 Mode 3, DC-CHAdeMO and DC-CCS standards. They’re known as trio chargers as they meet the three different accepted standards and can be used by all EV models.

Besides AC chargers, the first DC chargers are also hitting the market, a more costlier but more efficient charging option that is expected to drop in price as demand for same increases, chiefly in China and in Europe.

Larger Electric Batteries

Another trend that IHS Automotive has been following are new electric vehicles with larger and more efficient electric batteries. Well see more models equipped with 40kWh batteries, what deliver a range of at least 150 miles. Thats approximately double the range most standard EVs offer today, a move that will remove range anxiety from buyer consideration for more EV shoppers.

Also at play are lower prices driven in part by increased production and a price war that has pitted Panasonic against LG Chem. Panasonic is the battery supplier for Tesla and LG Chem for the Chevrolet Volt. Samsung has also gotten into the market and is the supplier of batteries for BMW and Fiat.

IHS Automotivve

LG Chem provides the electric battery for the Cadillac ELR.

New Technologies Mean Lower Operating Costs

And it isn’t just the battery makers that are delivering efficiencies. Both OEMs and other industry suppliers are finding ways to deliver improved or new products at lower costs, helping to drive down the price of EVs.

For instance, Bosch has developed a new start/stop system that shuts off power to the car and reduces fuel consumption by up to 10 percent. The Ford Motor Company has developed a solar panel that affixes to the roof of the Ford C-MAX Solar Energi Concept, what can provide up to four hours of battery charge daily on sunny days.

IHS Automotive Trends

Other electric auto trends that IHS Automotive has forecast includes consolidation of charging station companies, government-mandated EV sales in China, and a continued downward trend in EV prices although government incentives are critical to help consumers in this effort.

Certainly, 2014 will again be a pivotal year for EV sales, what will constitute about 0.5 percent of the global new vehicle market. Thats a drop in the bucket, but a positive auto trend that supporters will embrace.

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Polk Automotive Loyalty Awards Places Ford First Again

For the fourth consecutive year the Ford Motor Company has finished on top of the Polk Automotive Loyalty Awards as presented by IHS Automotive at the Automotive News World Congress in Detroit this week. Polk recognized 33 winner across a variety of categories including eight featured categories and 25 segment-level automotive loyalty categories.

Toyota Avalon
This full-size Avalon sedan was among four Toyota brand automotive loyalty winners.

Measuring Automotive Loyalty

Polk measures loyalty by determining when a household returns to the market to buy a new vehicle. When the household purchases or leases a new vehicle of the same model or make, then its loyalty to the company or brand is confirmed. For the 2013 model year, 7.4 million consumers returned to the market, up sharply from 5.9 million in 2012 for a 26 percent increase.

Three manufacturers General Motors, Toyota and Ford accounted for half of the total return-to-market population. And as has been the case since 2010, the Ford Motor Company led everyone. Moreover, the Ford brand itself outperformed its competitors meaning that Ford owners were more likely to return to Ford than Toyota owners were to go back to Toyota and so forth.

While the news was certainly good for Ford, other manufacturers also shined. In 2013, Cadillac demonstrated the most improved loyalty to a make and the Audi brand had the highest conquest percent of registrations. Subaru showed the most improved conquest rate of registrations.

Polk also takes a look at market loyalty by ethnicity. The African American market showed the most loyalty to Ford while both the Hispanic (Latino) and Asian markets demonstrated the most loyalty to Toyota.

Jeep Grand Cherokee.
Jeep Grand Cherokee: Non-Luxury Mid-Size SUV.

Top Segment Performers

In the 25 model segments Toyota, Chrysler, Mercedes-Benz, and Honda shined. Winning the non-luxury traditional compact car award was the Toyota Prius. Toyota also led in the non-luxury traditional full-size car segment with its Avalon, in the non-luxury mid-size truck with its Tacoma, and in the non-luxury full-size SUV segment with its Land Cruiser. Several Lexus models finished on top as well including the RX for luxury midsize CUV, the LS for luxury traditional full-size car, and the CT200H for luxury traditional sub-compact car. With seven segment awards, Toyota was tops among all brands.

The Chrysler Group took five awards with the Fiat 500 nabbing the non-luxury traditional sub-compact car award, the Chrysler Town Country finishing first among non-luxury mid-size vans, and the Dodge Challenger taking the non-luxury sport mid-size car award. In the non-luxury mid-size SUV segment the Jeep Grand Cherokee was the winner there while the Jeep Wrangler won the award for the non-luxury compact SUV segment.

Mercedes-Benz garnered four awards with its C-Class winning the luxury traditional compact car segment, its E-Class the luxury traditional mid-size car segment, and the SL-Class finishing first among luxury sports cars. The Mercedes-Benz G-Class was tops among luxury mid-size SUVs.

Mercedes-Benz C-Class
Automotive loyalty and the Mercedes-Benz C-Class.

Honda took three awards including the non-luxury traditional mid-size car segment with its Accord and the non-luxury compact CUV award for its CR-V. The Acura MDX finished first among luxury compact CUVs.

Six manufacturers rounded out the remaining spots including the Ford F-150 for the non-luxury full-size half-ton pickup segment, the Kia Sorento took the non-luxury mid-size CUV award, and the Hyundai Veloster finished atop the non-luxury sport car segment. For the luxury full-size SUV segment, the Land Rover Range Rover enjoyed the greatest customer loyalty. Among luxury exotic cars, the McLaren MP4 finished first and for the luxury prestige full-size car segment it was the Rolls-Royce Phantom that took top honors.

Overall Brand Loyalty

Customer loyalty is a big deal to manufacturers who strive to retain buyers as they reenter the market. Overall brand loyalty was 51 percent in 2013, up from 50 percent the year before. That also means that 49 percent of buyers bolted for another brand. So, manufacturers that successfully attract and retain buyers will enjoy not only improved sales, but the profits that come with them.

See Also — Ford Repeats as Polk Automotive Loyalty Award Winner

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