SOUTHFIELD, Mich. — New-vehicle buyers who previously own a used car could represent half of the total new-vehicle market this year, according to an analysis from IHS Automotive.

An analysis of vehicle registration patterns through the first half of the year finds consumers that owned a vehicle that was purchased used were responsible for nearly half of the new vehicles registered to individuals through June. This contribution of used-vehicle owners to the new-vehicle marketplace is the highest in six years, according to the analysis.

More than 3.2 million used-vehicle owners returned to market and purchased a new vehicle during the first half of the year, IHS reported. Of these owners, nearly 30% purchased a new vehicle of the same brand as their used car or truck. 

New product activity is a key driver of brand loyalty when consumers move from a used to a new vehicle. The availability and appeal of the product offering makes the launch of all-new models and major re-designs of existing models a very important piece of the decision-making process, officials said. Brands that have had the most success in converting used owners to new and keeping them dedicated to that brand include Land Rover, Subaru, Mazda, Mitsubishi and Jeep, among others. 

“Brand loyalty is something the automakers are putting a greater focus on as they expand product portfolios and competition intensifies,” said Tom Libby, solutions consultant for the loyalty management practice at IHS Automotive.  

New-vehicle owners who returned to market during the first half of 2014 purchased a new vehicle of the same make nearly 51% of the time, based on an industry average, which is slightly higher than the same period last year. Leaders in brand-level loyalty include Ford, Toyota, Mercedes-Benz, Chevrolet and Honda, all of which had loyalty rates of more than 54%.

Highest Make-Level Loyalty, June 2014 CYTD Make Level Loyalty (%)
Ford 62.7
Toyota 58.2
Mercedes-Benz 57.9
Chevrolet 55.6
Honda 54.6

At the individual market level, loyalty rates among new to new-vehicle owners vary from a high of nearly 62.5% in Lima, Ohio, to a low of 41.7% in Bend, Ore. Among used-vehicle owners purchasing new when returning to market, consumers in Buffalo, New York led the way with nearly 42% loyalty, compared to Eureka, Calif., with just 23.6% loyalty. 

Among the largest markets in the country, the New York City and Los Angeles DMAs represent the highest loyalty among both new-to-new and used-to-new vehicle buyers. It is also noteworthy that the 10 DMAs with the lowest make-level loyalty, on a new-to-new basis, are all in the western half of the U.S. The top five largest markets based on return to market volumes, and their loyalty rates are as follows:

New-to-New Make Level Loyalty (%) Used-to-New Make Level Loyalty (%)
New York City 50.6 New York City 33.7
Los Angeles 47.5 Los Angeles 25.6
Detroit 61.6 Chicago 26.9
Philadelphia 52.0 Dallas/Fort Worth 28.8
Chicago 49.5 Philadelphia 25.9

Source: IHS Automotive Time Period: Largest DMAs based on Return to Market Volumes, June 2014 CYTD