According to the J.D. Power and Associates 2002 Escaped

Shopper and Owner Loyalty Study released Aug. 28,

the aggressive manufacturer-sponsored rebates and

low-interest finance rates that are resulting in strong auto sales are proving

to be an effective tool in influencing the decision-making process of

new-vehicle buyers.

The study, which examines the reasons why new-vehicle shoppers consider, but

reject certain models, finds that price and incentives play an important

role in why consumers reject one model over another. Among new-vehicle

buyers who rejected at least one other model and who obtained zero-percent

financing, nearly one-half rejected another model because it failed to offer

sufficiently low rates.

"The study shows that shoppers weigh the incentives of one model over

another," said Chris Denove, partner at J.D. Power and Associates. "When

zero-percent financing first hit the scene, it drew people into the market

who otherwise would have delayed their purchase. But now that the newness of

it has worn off, we're seeing that 2.9 percent interest rates will do just

as good of a job in convincing someone to buy one model over another that

doesn't offer a similarly low rate."

Price continues to be the primary reason consumers decide not to purchase a

model they originally consider. The study finds that when someone considers

two or more cars, they usually end up buying the less expensive model.

According to the company, one of the more surprising findings of the study is that salespeople

sometimes cause shoppers not to purchase the models they represent by

turning them off to the entire brand. Overall, 16 percent of vehicles are

rejected due at least in part to the shopper's perception that the

dealership staff was unprofessional or treated them badly.

"Some people get an uneasy feeling about the way their salesperson handled

their business, so they decided to buy an entirely different make rather

than driving across town to find another dealership that sells that same

type of vehicle," said Denove.

The study also shows that some perceptions about vehicles do not always

match reality. For example, Jaguar is one of the most frequently rejected

brands because of reliability concerns. The J.D. Power and Associates 2001

Vehicle Dependability Study however, shows that Jaguar actually

manufacturers some of the most dependable vehicles on the road. BMW and

Mercedes-Benz models are frequently rejected because people believe they are

too expensive to maintain, yet the two brands provide free scheduled

maintenance for the first few years.

"It takes a long time for people to acknowledge product improvements, but

just a moment of bad press to sour the public's opinion of a vehicle," said

Denove. "This is an area of opportunity for manufacturers and dealers to

counter these kinds of misperceptions."

The 2002 Escaped Shopper and Owner Loyalty Study is based on responses from

more than 30,300 new-vehicle owners who registered their vehicle in January

and February 2002.

Headquartered in Westlake Village, Calif., J.D. Power and Associates is a

global marketing information services firm operating in key business sectors

including market research, forecasting, consulting, training and customer

satisfaction.