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Although price matters, brand reputation is important for low-cost vehicle purchases

[Johannesburg, 17 September 2014] - One in every three South African owners rated price as the most important purchase decision influencer, according to a recent study conducted by Ipsos. Price is followed by brand reputation, with roughly 16% of car owners placing great importance on the latter aspect.

This indicates that although price matters; vehicle quality, pre- and post-sales service (which contribute to brand reputation) are a key consideration for local automotive purchases; including lower-costing, "entry level" buys. Adding to this, a review of official sales figures for the period October 2013 to March 2014 revealed that the more established, entry level automotive brands grew market share – of between 1% and 6%. This is in contrast with lower-priced, new entrant brands which recorded losses in market share ranging between -1% and -4% during the same period.

It therefore appears that even for low-cost vehicles, South African consumers prefer to buy a car with "good return" in terms of durability, dependability and trade-in value. In some cases, opting for the lower-priced, new entrant brand can come with drawbacks, such as limited service and warranty plans. A few of the new entrants, low cost automotive suppliers offer three-year/45 000km service plans as compared with the more established automotive brands that offer five-year/100 000km service plans for new vehicle purchases ( and this includes their entry level models). Some of the new, lower-priced entrants are also much lighter on innovation and do not have boot lights, electric windows or radio.
[Full Story.]
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Although price matters, brand reputation is important for low-cost vehicle purchases

Last updated : 17 September 2014


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