Customers Are Spending More to Buy Entry SUVs;Popularity Soars and So Does Satisfaction, J.D. Power Study Finds
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Daihatsu Ranks Highest among Mass Market Brands In New-Vehicle Sales Satisfaction in Indonesia for Second Consecutive Year
SINGAPORE: 3 Oct. 2016 — Entry SUVs1 are quickly gaining popularity among Indonesian vehicle buyers, with owners spending an median of 21 months of their household income to purchase a vehicle in this highly aspirational segment, compared with 18 months for the rest of the market, according to the J.D. Power 2016 Indonesia Sales Satisfaction Index (SSI) StudySM mass market segment, released today.
The market share of entry SUVs has doubled in the past three years to 16% in 2016 from 8% in 2014. Overall satisfaction with the new-vehicle sales process is higher among owners of entry SUV models, compared with industry average (774 vs. 770, respectively, on a 1,000-point scale).
The study finds that the factors driving owners’ decisions to purchase an entry SUVs are style-related, such as desired vehicle body type (20%) and attractive design and styling (18%). Owners of vehicles in other segments say their priority for purchase is primarily driven by cost issues, such as good fuel efficiency (21%).
“Even though the Indonesian automotive industry is facing some challenging times, it is encouraging to see entry SUVs bucking this trend with healthy sales volumes,” said Kaustav Roy, director at J.D. Power. “Entry SUV owners are not only accepting the higher price tag, but they are also more highly satisfied with the shopping process, demonstrating that auto dealers can also thrive in trying times with the right product lineup and strong sales processes.”
A higher proportion of entry SUV owners indicate receiving the following activities from their dealers, compared with owners of vehicles in other segments: demonstrations during test drives (35% vs. 30%, respectively); receiving a thorough explanation of the vehicle during the delivery process (85% vs. 79%); and receiving their vehicle at the promised delivery time (63% vs. 59%).
Websites of Interest to Vehicle Buyers
Nearly three in 10 (29%) customers in Indonesia are turning to the internet as a source of information for vehicle prices (73%), technical specifications (44%) and vehicle features or accessories (40%). However, customers are more likely to collect the information from the auto section of a consumer/ news website or a web portal (60%) rather than manufacturer websites (10%).
“Manufacturers’ websites are the most authentic and credible sources of information for any website visitor, yet only 10% of internet shoppers are referring to them for information,” said Srabani Bandyopadhyay, country manager at J.D. Power. “Manufacturers need to identify the gaps that exist between their content and what is being offered on alternative sites, and adjust their content accordingly.”
Now in its 16th year, the study examines six factors that contribute to overall new-vehicle owner satisfaction with their purchase experience (listed in order of importance): delivery timing; delivery process; salesperson; sales initiation; dealer facility; and deal. Satisfaction is calculated on a 1,000-point scale with a higher score indicating higher satisfaction.
Following are additional key findings of the study:
- Median Price of Vehicle: The median price of a new vehicle in Indonesia has increased 11% to Rp209 million in 2016 from Rp188 million in 2015. Customers are noticing the price increase, as 12% of owners say the price is higher than they expected, up from 9% in 2015.
- More Problems at Dealership: More customers (11%) are experiencing frustrations and problems while new-vehicle shopping—like a small selection of models in stock and insufficient staff to handle customers during the sales process—compared with only 7% in 2015. Overall satisfaction among customers who experience problems averages 726, compared with 776 among those who do not experience problems.
- Vehicle Hand-Over Time: While 96% owners have their vehicle delivered to their home, customers expect the salesperson to spend at least one hour during the hand-over process. When the salesperson spends less than one hour during delivery, satisfaction with the delivery process drops to 772, compared with 779 when the salesperson spends more time during delivery.
- Satisfaction Increases Loyalty and Advocacy: Among highly satisfied customers (SSI scores of 811 or higher), 35% say they “definitely would” purchase the same brand of vehicle and 55% say they “definitely would” recommend the brand to family and friends. In contrast, among customers who are highly dissatisfied (SSI scores of 730 or lower), only 21% say they “definitely would” repurchase the same brand and only 32% say they “definitely would” recommend the brand to others.
Daihatsu ranks highest in sales satisfaction among mass market brands in Indonesia, with a score of 776. Daihatsu performs particularly well across all factors. Honda ranks second with a score of 772, while Mitsubishi ranks third with 769.
The 2016 Indonesia SSI Study is based on responses from 2,452 new-vehicle owners who purchased their vehicle from September 2015 through June 2016. The study was fielded from March through August 2016 and measures new-vehicle owner satisfaction with the sales and delivery experience from authorized dealers in Indonesia.
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About J.D. Power in the Asia Pacific Region
J.D. Power has offices in Tokyo, Singapore, Beijing, Shanghai, Malaysia and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries in the Asia Pacific region. Together, the six offices bring the language of customer satisfaction to consumers and businesses in Australia, China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan, Thailand and Vietnam. Information regarding J.D. Power and its products can be accessed through the internet at asean-oceania.jdpower.com.
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1. The entry SUV segment is defined by J.D. Power and may differ from manufacturers’ definitions. Examples of entry SUVs in Indonesia per J.D. Power’s definition are Daihatsu Terios; Honda BRV; Honda HR-V; Mazda CX-5; Mitsubishi Outlander Sport; and Toyota Rush.