LOS ANGELES - It's a flat year for sales, but everybody is forecasting higher market share. That could create the world's first 108 percent market, the president of Mazda North American Oper-ations quipped here last week.
Speaking to 600-plus attendees at the annual Automotive News West Coast Marketing Luncheon here last Wednesday, May 6, Richard Beattie outlined some challenges automakers face in a flat market.
'You can differentiate on price, which no one wants to do, or product or service,' he said. 'We're choosing product. We're the best-kept secret waiting to be discovered, and I'm not real proud of that.'
Yale Gieszl, executive vice president of Toyota Motor Sales U.S.A. Inc., was perhaps the most cautious in his view of the market.
'We have a strong economy, GDP growth, wages are outpacing inflation, and consumer confidence is at an all-time high. So why aren't more people buying cars and trucks? Is this as good as it gets?' Gieszl asked.
EYES ON INTERNET
Gieszl also warned that the recently launched incentive war can do nothing but erode brand equity, and said the Internet has the potential to seriously affect long-term profitability of automakers and their dealers.
It is no secret that the Internet will be more important, said Thomas Elliott, executive vice president of American Honda Motor Co. Inc. And Honda already has used it to launch the CR-V sport-utility and is doing it again to get more information about those who plan to buy its upcoming minivan.
'We could spend $2 million for a 30-second ad for the last 'Seinfeld' episode and get 56 million gross impressions. But how many people actually watched the ad?' he asked.
So even though the Net currently represents a slim 2 percent of American Honda's advertising budget, Elliott sees it as money well spent to accurately identify consumers from the initial query through the final sales process.
Three of the speakers represented marques facing trouble in the United States: Mazda, Mitsubishi and Nissan. All talked about the need to differentiate. Yet their differentiation seems somewhat similar.
Upcoming Mazda advertising will describe their products as 'spirited performance and distinctive styling' that understand the buyer's need to 'go zoom-zoom.' Mitsubishi will describe itself as 'spirited products for spirited people.' And Nissan will pitch product dependability, quality and reliability.
'We need to create demand. We can't be like Toyota or Honda, everything to everybody,' said Pierre Gagnon, executive vice president of Mitsubishi Motor Sales of America Inc.
Lincoln Mercury General Manager Jim O'Connor described the division as the newest 'import' to California.
Plenty of Ford Motor Co. managers have asked to move from Dearborn, Mich., to the new Lincoln Mercury headquarters in Irvine, O'Connor said, adding that he has received about 75 applicants from local Asian sales arms.