DETROIT – Frugal buyers are not looking for fancy features like a leather-wrapped steering wheel, a moon roof, fancy lighting, or, say, a configurable digital gauge cluster. Data and industry analysis company AutoPacific also points out that its research shows that its time “automakers may need to get creative by streamlining their current offerings and do whatever.
“Front wheel drive, base stereos, cloth seats with various manual adjustment, and analog gauges are ‘in,’ for these more frugal shoppers, so the array of standard equipment found on entry- and mid-level trims of today’s popular vehicles within the $25,000 to $35,000 price range may need to be reexamined as consumers tighten their belts in the face of economic uncertainty.”
Feature Creep Is Not New, But More Relevent Than Ever
As AutoPacific points out, “the automotive industry continues to be caught in the middle of chaos, fending off rare-earth minerals shortages for parts, ever-changing tariff guidance on imported vehicles and parts that necessitate relocating production locations, general inflation, and punishingly high interest rates.” Let’s also not forget the exponential rise in insurance rates.
At the same time as interest rates are high, prices are rising, and running costs are more expensive, consumers across the US are being forced to make sure they are getting value for money when they spend. That means not being sold cars full of features they don’t need or want. In fact, AutoPacific has data showing the demand by percentage of car buyers for individual features. And it tells the story you probably expect, including how leather seats aren’t high on the list for that many buyers.
| Feature | Demand Amongst $25k-$35k
Vehicle Shoppers |
Demand Amongst $35k+
Vehicle Shoppers |
% Difference |
|---|---|---|---|
| All-wheel drive/4×4 | 24% | 29% | -5% pts |
| Memory for driver’s seat position | 23% | 27% | -4% pts |
| Power-adjustable front passenger seat | 26% | 31% | -5% pts |
| Heated steering wheel | 26% | 31% | -5% pts |
| Wireless Apple CarPlay/Android Auto | 26% | 31% | -5% pts |
| Branded premium audio | 15% | 21% | -6% pts |
| Selectable vehicle drive modes | 26% | 33% | -7% pts |
| Interior/exterior welcome lighting | 22% | 28% | -6% pts |
| Panoramic sunroof | 20% | 27% | -7% pts |
| Reconfigurable digital gauge cluster | 21% | 27% | -6% pts |
| Leather upholstery | 11% |
| Head-up display | 15% | 23% |
Feature creep has been happening for decades across many industries, but the automotive industry has been especially good at it with the trim level and options framework for selling cars. Once upon a time, a moon roof or upgraded audio system were singular options, now if you want one or the other, it’s often bundled in the next trim or two up from the one you might be able to afford or in an optional package.
The Fix For Feature Creep
It is clearly time for automakers as a whole to re-evaluate how they approach features and trims. Some are better than others, but all play the game to varying degrees. There are good reasons for automakers to play the game as well. We are aware of that. After all, the majority of cars aren’t ordered specifically by the customer anymore, so the cars shipped out to dealers need to appeal to as many people as possible.
Then, the cost of logistics for individual configurations is lower. The creativity is going to be in how automakers build their entry-level and mid-tier trims and separate packages as people become more intentional about the cars and features that they buy, and how they make them available to dealerships. In fact, one option could be to push for dealerships to be skipped completely as that’s a stage of the chain that needs to profit separately from the automaker.
SOURCE: Car Buzz
