Car Shoppers Spend Less This Holiday

Are you done with your last-minute holiday shopping? Me, I’m just starting with my holiday rush. I sure find a lot of stores jammed with shoppers. Yeah, we shop a lot. But a survey defies my observation…

According to a recent Kelly Blue Book marketing research, shoppers spend less this holiday season because of high gasoline prices. They tend to spend less on self so as to spend more on other stuffs, the research continued.

The December 2007 results found that 44% of in-market new-vehicle shoppers are looking at cars they normally would not have considered due to the pain at the pump. An example of this is a notable shift in vehicle segment consideration from just a couple of months earlier, with increased interest in less expensive and more fuel-efficient transportation including crossovers, sedans and hatchbacks, and declines in sport utility vehicle interest, Auto Spectator reported.

With a gallon of unleaded gasoline presently hanging at over $3 in most parts of the United States, 67% of those in the market for a new vehicle indicate they will not spend less on holiday gifts this year due to the rising cost of gas. However, more than 40% of consumers do say they are eating out less often and nearly 50% of consumers say they are doing less shopping of non-essential retail items such as clothes and shoes; further examples of consumers cutting back on self-spending. According to new-car shoppers, the largest shift in personal spending includes delaying the purchase of a new home, which more than doubled from October to December, the report continued.

“While gas prices are clearly influencing the way consumers plan to spend money on themselves, such as going out to eat and delaying the purchase of a new home, it appears most people will not let the price of gas affect their holiday spirit and giving to others,” said Jack R. Nerad, executive editorial director and executive market analyst for KBB. “Based on our monthly study, shoppers are willing to sacrifice in order to still give to others, and it even extends to their next new-vehicle purchase. We are seeing more and more new-vehicle shoppers looking at smaller and more fuel-efficient cars than in the past.”

Asked how gas prices have affected which vehicles they are considering, more than half of shoppers said they would seriously consider a vehicle with higher fuel efficiency if gas prices were to increase as little as 50 cents per gallon. Among those looking to buy a new hybrid vehicle, shoppers say they are most interested in the Toyota Camry hybrid and the Honda Civic hybrid.

“Determining how gas prices affect consumer shopping provides tremendous insight into shifts in the economy, and tracking their opinions of alternative fuel solutions sheds light on the possible adoption and acceptance rates of alternate fuel systems in the future,” said Rick Wainschel, vice president of marketing research and brand communications for KBB.

“Timely, in-market vehicle shopper feedback can provide invaluable information to automotive manufacturers and marketers, allowing them to tailor their messages and strategies more toward what car shoppers actually think and how they plan to spend their money,” he added.

To learn more about the study, visit http://www.kbb.com.