Global car survey finds six in ten lean toward green, if money no object

KUALA LUMPUR — Leading global market research firm Synovate today released new study findings showing that six in ten people would choose to buy a green car over a dream car, even if money was no object.

Synovate surveyed more than 13,500 people across 18 markets about ’green’ versus ’dream’ cars, vehicle ownership, intent to buy in the next year and attitudes towards cars, traffic, public transport and their need-for-speed.

Dream, green or in between?

Is green mainstream? Can the lure of the environmentally friendly vehicle outweigh the desire for all the raw power of the petrol engine? Synovate asked respondents to forget about money for a moment and tell us whether they would buy green, dream or in between.

The top answer across all 18 markets, if money was no object, was to buy a green car, with 37% of respondents saying this would be their preferred purchase. Thirty percent said they would buy their dream car and a further 22% claimed that ’my dream car is a green car’... meaning that 59% - or very nearly six in ten - showed the desire to go green.

"Car makers are producing more and more options that will appeal to this fast-growing group of green-inclined people" says Synovate’s CEO of Motorsesearch, Scott Miller.

"But we cannot forget that cars are the ultimate product when it comes to an emotional connection with people. What you drive says more about you than you think. There will always be a group of people who do not want to compromise on dream cars for green reasons. The answer? The 22% who want both are the way of the future. Car makers will produce vehicles that are dream and green"

Some of the highest results for ’green’ were Thailand at 77%, Korea at 76%, China at 75% and Brazil at 72%.

Synovate’s Director of Motoresearch for China, Kelvin Gin, says it’s not a surprising result for China.

"Last year’s Olympic Games really highlighted issues with China’s air quality, plus the Government has made concessions for both green car manufacturers and the people who choose to buy and drive them. In fact there is RMB10 billion (approx US$1.5 billion) up for grabs for investment in manufacturing greener cars"

The Brazilian Government also provides incentives for people to buy greener vehicles.

"By law, all cars now have to be flex-fuel which has quite quickly made ’green’ cars part of behaviour and thinking in Brazil" says Ari Gonzalis, New Business Director for Synovate Motoresearch in Brazil.

"Brazilians are also proud that the nation is a leader in developing alternative fuel that is cheaper and pollutes less. By making ’green’ de rigueur, the Government has actually created a scenario where people’s dream cars are green by definition"

Despite the ’fantasy’ element of the question where money is no object, Synovate Korea’s Motoresearch Head, ByeongHwan Je, puts the Korean lean towards green down to economics.

"Green or hybrid cars are more fuel efficient and, together with pollution concerns, this economical issue would be a big part of why Koreans put green over dream"

The nation most likely to simply elect ’green car’ was Germany, with 58% choosing the environment over their dream cars.

So where can the dreamers be found? Overall, 30% of people would still choose their dream car green-be-damned, comprised of 35% men and 27% women. The single biggest result for dream car came from South Africa where over half of all respondents (53%) would go for their fantasy vehicle over a green one.

South Africa-based Richard Rice, Director of Global Motoresearch Sales & Marketing for Synovate, says that, in South Africa, the car is probably the closest product that comes to a visible expression of who a person is.

"Here a car is emotional. People love their cars... for the freedom, for the image they create, for what it says about their status. Consequently, that image is far more important than how environmentally friendly a car is.

"Compounding this is that many car buyers in South Africa are the first family members to even be able to buy a car so, in the excitement, green considerations will fall by the wayside. We’ll go with however much power we can afford"

Similarly, 47% of Indians say they would go with their dream car, something that Sumit Arora, Head of Synovate’s Motoresearch group in India, explains is due to the ’new’ India.

"The Indian auto market is vibrant. Every year new ’dream’ models are launched and major world players arrive. Luxury cars have started hitting good numbers.

"And what’s driving this is ambition and aspiration. People now have more money, more choices and they are willing to spend. Ownership of big-ticket items is a reflection of success and conspicuous consumption is celebrated. These numbers will only rise"

In the United States (US), 35% would buy a dream car, 23% chose green and 19% say their dream car is a green car.

Purchase intention: Brakes on or gearing up?

Overall, 15% of respondents across 18 diverse markets say they will buy a new car in the next 12 months. The new car purchaser intenders were topped by India at 38%, Egypt at 24% and Turkey at 23%.

US-based Vice President of Synovate Motoresearch, Tim Englehart, says this is an indicator of where we are economically around the world.

"This clearly shows that car companies have great opportunities in the emerging markets of the world. It needs to be noted that this survey was conducted across urban people from the large cities so, while the results are not representative of the general population of the country, they are absolutely representative of people the car companies may wish to target.

"Many of these people will be first-time buyers and they may not be intending to buy a large family car. For example, a third of urban respondents in India saying they intend to buy a new vehicle is not surprising but this number would be growing with the introduction of a US$2,000 Tato Nano. This car has the entire industry buzzing"

Tamer El Naggar, Managing Director and auto research specialist for Synovate in Egypt agrees there would be a large proportion of first-time buyers there.

"The dream of car ownership is being achieved by more and more middle-class Egyptians. There are more opportunities now as smaller and cheaper Chinese cars are making inroads in the market"

Least likely to be buying a new car are Australians and Germans, with only 6% saying they will do this in the next year.

Peter Riley, Account Director of Motoresearch in Australia, says, "One explanation for the low purchase intentions for new vehicles in Australia could be that, just prior to the global financial crisis, Australia posted record new vehicle sales. This is likely to have pushed the replacement cycle out. There is also a polarisation in the market between consumers who want to take advantage of low interest rates and great deals on offer, and those who prefer to remain cautious with their spending"

A further 6% of survey respondents across the 18 markets say they will buy a used car in the next year.

Englehart says the 6% is relatively small but car companies have an emerging opportunity in this market.

"There’s a strong chance for a second bite at the cherry when it comes to their branded cars. Our survey showed that over half of all respondents (53%) agree they would be happy to pay more for a used car if it came with a manufacturer certification and warranty"

The highest agrees came from Turkey (79%), Korea (70%) and South Africa (69%).

Does public transport have legs?

Personalised transport like cars and motorcycles answer that basic need, getting from point A to point B. Yet, public transport can often take care of that as well, albeit with a little less style. It’s greener and cheaper, both important considerations, so are more people joining the queue for the bus?

Overall, 14% of respondents across the 18 markets say they will use public transport more often in the coming year. The highest level of agreement was in China at 39%.

Synovate’s Kelvin Gin says Chinese people are definitely curtailing spending but we also need to remember that not that many people own cars yet in China.

"Even though this is an urban sample (so potentially more car owners) and China is arguably the world’s top car market, you still have well over a billion people here who do not own a vehicle. They have to get places somehow so public transport is always in demand in Chinese cities. The Government is improving public infrastructure all the time too"

There was also a high response in Korea where a third of respondents said they will use more public transport and Synovate’s ByeongHwan Je puts this down to simple economics.

"Korea imports 100% of its petroleum and gas from other nations and is therefore very price-sensitive. Even though fuel prices are down from last year, fuel for personal vehicles is still quite a luxury. The Government also actively pushes the use of public transport"

Only 2% of American respondents say they will use more public transport in the next 12 months.

The survey also asked if people would be riding bikes or walking more often and an overall 9% agreed that they would. The highest results were Korea at 20%, Germany at 17%, China at 16% and Japan at 15%.

Shinya Goto, Head of Synovate Japan’s Motoresearch team, says that multiple factors are at work.

"Public transport, walking and bike riding are no doubt more popular in all these markets for similar reasons... the environment, exercise and economics. But in the case of Japan there is another important factor at work, one that has implications for the auto industry.

"The younger generation is moving away from personal transport. From the late teens to around 30, we see much less inclination to own a vehicle. These young people are environmentally aware and would rather spend their money on mobiles and clothes, taking public transport and creating a ’cocoon’ with their mobiles or iPods. This is a real change from other generations"

CEO of Synovate Motoresearch, Scott Miller, says this trend will move beyond Japan.

"Two car households will become one car households. More and more, owning a car may not be viewed as that responsible.

"Smart car makers are already working to find types of vehicles and performance characteristics that will not make people feel responsible for environmental damage; and working to stop the reputation that cars are bad for the world.

"So it’s not all doom and gloom - not by a long shot. Quite simply, cars are freedom... and people value freedom above most other things. If they continue to enjoy guilt-free freedom, the car will stay a large part of daily lives for many people"

Love me, love my car

While many are pragmatic about cars, seeing them as a means to an end, the survey also showed that, for many, the love affair with the car remains passionate.

Forty-three percent of Egyptians say they cannot live without their car; 11% of United Arab Emirates (UAE) respondents say that - above anything else - their vehicle makes them feel good; and 27% of Indians and Malaysians are jealous of friends with better cars.

Ajay Bangia, Associate Director of Synovate Motoresearch in Malaysia, points out that vehicles can act as strong indicators of social status and success.

"Everyone wants a shiny new car to announce to the world - but especially to their neighbours and friends - that they have arrived"

Indeed, an overall 27% of respondents agree they would love a car that turns heads, with standout agreement from the UAE (61%), India (50%), China (40%) and Egypt (36%).

Synovate Director of Motoresearch for Central and Eastern Europe and the Middle East, Achilleas Militiadous, says that the expat-heavy city of Dubai is full of people after an eye-catching vehicle.

"Quite a few expats can afford a car that they would not be able to buy back home and of course, despite the downturn, the UAE still has more than its share of the super-wealthy who can afford very luxurious vehicles.

"But this phenomenon is not confined to those who can afford cars. Sometimes people pay more for their car than they do their accommodation"

Still, 36% of all respondents see their vehicles as something that simply gets them from one place to another, something that Synovate’s Tim Englehart believes is linked to a loss of connection with car brands.

"There is a lack of emotional connection among many drivers now due to cookie cutter designs in the name of cost cutting. Long term, that loss of emotion will have a big impact on people’s relationships with car brands.

"Car makers have to get the balance right. A car can still be very cool while offering practicality and a lower price. Success in the auto business comes from understanding people well enough to meet their emotional needs as well as practical ones"

Governments taking the wheel

In a global recession, with car companies struggling and the subsequent loss of jobs and economic power, should Governments drive matters?

The Synovate survey asked people whether they agreed with ’I think it’s reasonable in a recession for car manufacturers to receive financial assistance from Governments’. The question was posed in March 2009, ahead of the US Government’s General Motors investment, but well after many other Governments stepped in, in a variety of ways.

Overall 41% agreed that it was indeed reasonable for auto industry assistance in a recession. Most of the markets surveyed have national car industries in common, so there’s a strong cultural variability on whether people thought those industries and jobs should be influenced by a Government or left alone.

The top markets for agreeing that Governments might step in were South Africa (63%), Turkey (60%), Malaysia (59%), China (58%), India (55%) and Thailand (54%).

South Africa’s Rice says people there expect a lot of the Government.

"The car industry here employs tens of thousands and makes a significant contribution to the GDP... for most South Africans it makes complete sense to support Government financing"

Gulsah Olcay, Head of Synovate Motoresearch in Turkey, says there were big layoffs in the sector prompting the launch of Government support.

"The Government offered direct assistance to car manufacturers who did not lay off employees, preserving a number of jobs. Turkish people in general think that’s a good result from a Government action"

Ajay Bangia of Synovate Malaysia says the answer there is also linked to national pride.

"Malaysians have a complex relationship with Proton, the national car maker. People would be quick to complain about a niggly power window problem but also feel enormous pride. Proton has become a symbol of national ingenuity and this is why people would be very supportive should the company require support"

Least likely to support Government interventions were the Japanese (67% disagreed with the statement), Americans (65% disagreed) and Canadians (64% disagreed).

Synovate’s Tim Englehart puts the North American responses down to through-and-through capitalism.

"We’re going through an extraordinary time in the US in particular at the moment but this does not change the fact that both Canada and the US are among the most capitalistic countries in the world. That kind of background and national philosophy doesn’t change overnight"

Curiosities

* Ninety percent of Greek respondents do not want a car that can turn heads... car ownership there is directly linked to tax payments and this kind of car would cost!
* Fast-growing city, fast cars... 59% of UAE respondents agreed they like to drive fast.
* More South African women than men would choose a dream car over a green car (57% women versus 50% men) if money was no object.
* The United States, Malaysia and Thailand all had 15% of respondents who lived in households with more than two cars.

About the Synovate global ’Dream versus green’ cars survey
This car survey was conducted in March 2009 across 18 markets – Australia, Brazil, Canada, China, Egypt, France, Germany, Greece, India, Japan, Korea, Malaysia, South Africa, Thailand, Turkey, the United Arab Emirates (UAE), the United Kingdom (UK) and the United States of America (US). It covered over 13,500 urban respondents.