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Downbeat news paints false portrait of industry
During the past six months, the automotive industry has attracted some sensational headlines across North America.
High energy costs, restructuring efforts, coming losses of manufacturing jobs and the volatility of the SUV market are some of the big news stories that have generated a lot of press.
The media generally do a thorough job covering our industry and providing consumers with balanced reporting and insight into a highly complex sector. When it comes to understanding the ins and outs of the auto business, people today have access to a wealth of information.
But is too much information always a good thing, at least where car buyers are concerned?
Sensational headlines, major announcements and wild speculation can leave consumers feeling confused at times, and this could hamper car-buying decisions.
Customers ask me: Will gas prices stabilize? Will there be a market for my SUV in four years? When will alternative-technology cars be widely available?
These are great questions, but I can't pretend to know the answers, any more than auto makers can predict what vehicles will be popular five or 10 years down the road.
Consumers often react emotionally to news stories about the auto industry because cars are so vital to their lives. Many of us spend a good deal of time in our cars, and we are intimately connected to our vehicles on many levels. Cars are part of our identities.
The automotive sector is facing many changes today. Perceived high gas prices, the race for alternative technologies, continuous competition, consolidation, quality control benchmarks and the opening of new markets are just a few of the hot-button issues that our industry is adjusting to.
Is our industry in crisis?
No. In fact, I would argue exactly the opposite. The auto industry is entering a great renaissance period, where intelligent design and engineering features, as well as clever styling, are becoming the new gold standard among all car makers. Our revitalized industry is experiencing some short-term pain to win long-term gains.
This year's Canadian International AutoShow, which ends tomorrow, presents the North American premières of the DaimlerChrysler Akino and Mazda Senku concepts. These sophisticated new designs fuse cultural influences from east and west and resemble works of art.
Sensational headlines often paint a false picture of our industry, ignoring the true strength and vitality and resourcefulness of today's auto makers. They sometimes provide a deceptive, knee-jerk reaction to events.
The bottom line: Consumers should always keep an open mind and pursue their own agendas when they are in the market to purchase a car.
Let's examine the SUV market as an example. In December, some auto analysts predicted its demise because of rising gas prices.
Admittedly, some auto makers reported a dip in sport-utility sales at that time, but in the first two months of 2006, gas prices stabilized. SUV sales have bounced back and are expected to remain healthy over the next few years.
Then there is the issue of gas prices. Just six months ago, the price of oil spiked, causing widespread fear and panic among car owners. Well, gas prices have fallen again, with price wars breaking out. Motorists are left scratching their heads.
Nobody knows what's ahead. Some experts predict that fuel-efficient vehicles will become the wave of the future; some think otherwise. Who's right?
Competent individuals make educated guesses but, as we all know, market conditions can change on a dime.
The only constant in the car industry is change; new-car dealers adapt to new situations all the time. It takes up to four years for auto makers to plan a new vehicle launch, during which time any number of factors could affect the eventual success ? or failure ? of that vehicle.
In many cases, manufacturers get it right and a model's sales are strong. Sometimes, they aren't so lucky.
Spring is traditionally a busy time of year in the retail car business. Inspired by the AutoShow, many consumers will be visiting new-car dealerships. It's an exciting time.
If you feel overwhelmed by the plethora of models out there, try creating a manageable short list of your top choices.
Remember, you are the ultimate decision maker when buying a car. Don't allow dramatic news stories or market predictions to interfere with your purchasing decision.
Throughout the selection process, your lifestyle, your driving habits and your budget should be foremost in your mind ? not the latest headlines.
Paul Stern, president of the Toronto Automobile Dealers Association, is a new-car dealer in Toronto. This column represents the views of TADA; email comments to president@tada.ca. Website: www.tada.ca
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