Competition Gap among Top Vehicle Manufacturers in the U.S. Smaller Than Ever, According to IHS Automotive

A recent IHS Automotive analysis of U.S. new vehicle market share among vehicle manufacturers indicates the competition at the top has never been greater.

In the past 14 years, market share range among the eight largest OEMs in the United States has quietly declined from nearly 26 percentage points in 2000 to just 14 percentage points through October of this year, reflecting how intense the competition truly is in this market. The volume dynamic has also changed, with nearly 17.5 million vehicles registered in 2000. Based on the IHS Automotive projection for U.S. sales in 2015 to reach 16.7 million units, to gain 1 percent share, an automaker needs to sell an additional 167,000 vehicles. In 2009, during the trough of the recession, 1 percent could be gained by selling 104,000 vehicles.

General Motors and Ford Motor Company continue to lead the U.S. market, though their shares have shifted dramatically over time. Chrysler (now FCA) and Toyota have exchanged ranks in third place since 2000, with Toyota’s share increasing. Honda has remained as the fifth largest OEM based on market share, and its share has improved over time. Hyundai has improved nearly 6 percentage points in the timeframe, the largest increase among the top manufacturers.

“Since no OEM wants to slip in the rankings, each is doing everything possible to retain each tenth of a point share; including speeding up product redesign or launch programs, while opting to avoid risky product programs that could cause disruption in their product portfolio,” said Tom Libby, solutions consultant at IHS Automotive, who worked on the research.

With no manufacturer accounting for more than 18 percent of the U.S. market, the battle for consumer share will be fought on the marketing front more than ever before. This parity among the leading OEMs is moving them to identify and utilize the most efficient marketing tools across a wide array of potential marketing channels, including traditional national TV and print advertising and a nearly overwhelming variety of digital advertising tools and platforms. The increased communication tools enable each OEM greater freedom to adopt their own product and marketing programs to gain share and more effectively direct messages to the consumers that will most appreciate the attributes of each product. As shares of the four leading OEMs are so close, since the order could change with just a half point gain or loss of share, every initiative is critical.

Great for Consumers, Great for the Industry

Consumers are the winners in this scenario. “These conditions drastically improve the value proposition for consumers shopping for new vehicles, with greater competition, more refreshed products and increased pressure on prices, which contributes to strong retail demand,” Libby said.

IHS Automotive forecasts that this tight market share dynamic is the new normal for the U.S. auto market, with no change in rank and only small changes in share among the top four for the next several years. GM is forecast to retain its lead, followed by Ford, Toyota and Chrysler. With this new normal dynamic going forward, competition within the U.S. auto market will remain fierce, the analysis said.

About IHS Automotive (www.ihs.com/automotive)

IHS Automotive, part of IHS Inc. (NYSE: IHS), offers clients the most comprehensive content and deepest expertise and insight on the automotive industry available anywhere in the world today. With last year’s addition of Polk, IHS Automotive now provides expertise and predictive insight across the entire automotive value chain from product inception—across design and production—to the sales and marketing efforts used to maximize potential in the marketplace. No other source provides a more complete picture of the global automotive industry. IHS is the leading source of information, insight and analytics in critical areas that shape today’s business landscape. IHS has been in business since 1959 and became a publicly traded company on the New York Stock Exchange in 2005. Headquartered in Englewood, Colorado, USA, IHS is committed to sustainable, profitable growth and employs about 8,800 people in 32 countries around the world.

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