Priceonomics:
Using our (CarMax) data, we explored which cars people own at trade-in and what they purchase as their next car. Do they stay with the same brand or not? Are people loyal to the same type of car they used to drive (i.e., do SUV owners keep buying SUVs or do they switch to sedans)?
Based on our data, we found that the brand with the most loyal owners is Lexus, followed by Mercedes-Benz and then Ford. The brand with the least loyal owners is Volkswagen, followed by Mazda and Volvo.
I found this fascinating. As someone who doesn’t own a car and doesn’t really care about cars, I had no idea that brand loyalty was so low in this market. No wonder the advertising around it is so prevalent and forceful. Customers are ripe for changes.
This doesn’t surprise me. I owned 3 Toyotas and found the dealer support and service was excellent. When I returned from overseas my brother found me a deal on a VW Tiguan so I bought it. The dealerships have been shockingly bad and the vehicle reliability is poor.
VW claims the problems are with the independent dealers. The dealers say the problem is VW corporate. Customers don’t care and hate finger pointing.
The flaw here is that it’s just looking at people buying used cars. The numbers might be different if they went straight to the dealer. Our VW 2008 Rabbit has been very reliable, the Tiguan ok but not the worst we’ve had, and now that we’ve found a local independent service place we will probably keep it until it drops. I just replaced the Rabbit and we did look at another Tiguan but didn’t like the back seats. I really wanted an electric car and came very close to buying a Nissan Leaf but did something crazy and got a Mini Countryman.
Yes, and an engine shouldn’t need to be cleaned every 5000 miles…
We chose our car on price and ability to accommodate people who aren’t diminutive. Our only choices were either a long list of ridiculous SUVs or a couple of Buick midsize cars.
We’ve had it since 2004, and put maybe 35,000 miles on it. If we needed to, we’d probably buy one again if that model still exists. We’ve almost never relied upon the dealer’s servicing.
For what it’s worth, I used to hang with a guy who swore by the Ford Taurus/Mercury Sable.
I’m wondering how much young buyers moving up market vs more established people staying loyal has an effect on the results, and the loyal car models seem to back up my hunch.
I’m guessing Volkswagen is at the bottom because of the whole emissions tampering fiasco. It’s a shame as they used to be some of the most reliable cars on the market until the late 80’s.
How many potential young buyers can actually afford to move upmarket?
I stopped using the dealer as well and went with a local independent. They had to “fix the fix” that the VW dealer had done.
This says less about car owners and more about CarMax shoppers. It excludes people who, for example, lease new cars and then stick with the same brand. Without dealer data, this is pretty useless as it relates to the broader market. CarMax isn’t even a good sample of the used car market. CarMax’s used car revenues are $14B of an $800B market.