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What Automaker’s Need to Know about their Customers
It’s amazing to note how many automakers are losing money simply because they have failed to understand the very basic thing about their buyers—and that is the very reason why people buy cars.
There are two chief executives of General Motors that have wasted hundred of billions of dollars because they failed to understand what their customers need. So why do people buy cars?
It is a fact that purchasing and owning a vehicle is quite expensive. The average price for a new car range is more or less ,000 quite expensive for the average Joe with average salary. But why do people still insist on buying one? There are various reasons why people opt to purchase a car but above all it’s because of the convenience factor derived from owning one.
With a car the usual one hour consumed in commuting to work is cut say to 30 minutes. Plus, for parents with kids, taking them to school becomes a simply matter. Traveling say from New York to Los Angeles and back is also made easy using a car. The long list of benefits in owning a car is endless. So what is the point I’m trying to derive here: people buy cars because of the benefits that they get from the vehicles. When automakers try to subtract the things that a vehicle can do they tend to lessen its value to them.
The Toyota Prius for instance is a successful type of hybrid because it provides the customers with benefits that are expected of it. Although not really fast but who cares its not going to be used for racing anyway. The important is its fast enough to get people to places they want to go to. It has a reasonable range and can carry a reasonable load for a small car. Its actually priced high---,000 or so but its high fuel economy and unique shape make it a rolling billboard for Toyota.
Its not only American auto people who don’t understand even the leaders of Daimler in Germany have missed the whole point with the Smart. This vehicle cost Daimler billion or so losses. Although it is true that Smart is cute but let us not forget the fact that very few buyers consider cuteness as a criteria in choosing a car unless of course your name is Paris Hilton.
The Smart which I believed is inappropriately named can seat only two people and doesn’t offer space for cargo. It is also very slow. You would not want to drive it in any distance unless you have nothing else to do with your time. And oh if you are thinking of driving it to say Paris to the Riviera or even on Europe’s superhighways you will only be frustrated. But in fairness to Smart it is very easy to park unfortunately parking is the least concern of buyers except in two cities, Paris and Rome. And in terms of its price, Europeans would probably choose to buy a small car such as Volkswagen Polo instead. This vehicle is equipped with top-of-the-line auto parts such as Volkswagen axle and can accommodate four passengers plus stuffs. Volkswagen Polo is also a great car to travel anywhere you want to go.
So why hasn’t DaimlerChrysler stopped the production of Smart as General Motors and Toyota has killed their production of electric cars? Speculations have it that it’s all about politics. It is said that killing the production of Smart would embarrass the Daimler board that approved the project and also the German office too. That is because the Smart plant is in France and stopping the production would mean Germans firing Frenchmen in a high unemployment area. That is not good for keeping foreign relations.
Does this mean that General Motors latest electric car concept the plug-in Volt is doomed? Officially not yet because of the very obvious reason--- it is still a concept and therefore it doesn’t exist yet. The Volt as explained by General Motors will run on lithium-ion batteries and so far these are non-existent yet. When they do come, General Motors says that the range problem will be solved by a small gasoline motor that supposedly will recharge the batteries when they weaken.
Since everything is a concept there is that possibility of it working and well not working. But we’ll just have to wait for it. General Motors has not yet released any statement on how much the Volt will cost. At least the buying public will have something to look forward to. That is of course depends on whether the public finds it worth their while.
And lastly it is very important for our automakers to think that if they want for customers to value their car they need to boost its functionality and not just present vehicles in a beautiful package to excite customers which later on will only be forgotten.
About the Author: Growing up with three brothers, Natalie Anderson became exposed early to the world of automobiles. This 29-year-old account manager now dreams of having her very own top-of-the-line vintage car.
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