Steel Waiting: What American Tariffs May Mean for Canadian Automotive

Two businessman pulling a rope in opposite directions over sky background with copy space

At Strathcom, we make a point of taking our client’s concerns seriously, which means staying up-to-date with the Canadian auto industry that keeps our (and our clients’) bread buttered. Talking to clients in recent months revealed a widespread concern over one issue in particular: the looming prospect of American trade tariffs that may hold serious economic implications for Canada’s automotive sector.

With the long-standing North American Free Trade Agreement (NAFTA) as a target of considerable “gutting”, the big fly-in-the-ointment takes the form of aggressive tariffs on Canada’s steel and aluminum, effectively stabbing the very heart of our nation’s automotive sector. Taking aim at such a significant economic driver generates huge concern throughout Central and Eastern Canada.

Continue reading “Steel Waiting: What American Tariffs May Mean for Canadian Automotive”

FCA Without F or C?

To say that Fiat Chrysler Automobiles has had a tough July is an understatement bigger than saying a nuclear bomb “goes boom”. First, they lost their leader Sergio Marchionne to complications following shoulder surgery, then to rub salt in the wound, July’s sales numbers arrived in what must have felt like a gut punch from an MMA heavyweight. While the entire Canadian auto industry struggled, FCA was one of the hardest hit with a 33.3% drop in overall sales compared to last July. While this slump surely won’t last, it does call into question the futures of the two automotive brands that FCA is named after, Fiat and Chrysler.

Fiat originally arrived in Canada back in 2009 to relative fanfare after its 25-year absence from the North American market. Sadly, that fanfare doesn’t seem to have translated into sales, as Fiat currently produces just 0.28% of all FCA sales in Canada. Dive into the statistics and you’ll see that sales shrank at a shocking 79% over the first seven months of 2018. That translates to overall sales of just 49 vehicles total in July— an unsustainable number by any measure.

Little vintage car on the street of Novara di Sicilia. Sicily. Italy

Continue reading “FCA Without F or C?”

Cutting Their Losses: Ford Says Sayonara to Sedans

little boy waving out car window

“So long — don’t let the four-doors hit ya on the way out!”

A surge in SUV and truck demand in the U.S. has forced Ford to take the drastic step of removing nearly all cars from its model lineup. Ford fans will be saying goodbye to the Fiesta, Focus, Fusion, Taurus, and C-MAX.

Ford’s rivals, however, are still committed to maintaining their rank in a segment that continues to account for millions of vehicles sold each year. But Ford has decided to cut their losses, and stick to what they know best: trucks, trucks, a few SUVs, and more trucks. Continue reading “Cutting Their Losses: Ford Says Sayonara to Sedans”

Dealers Asked, Google Listened: Google’s 2017 Dealer Playbook

GOOGLE’S DEALER PLAYBOOK IS HERE!

2017 Dealer Playbook

If you attended any of the Google Think Dealer events this fall, you know that Canadian dealers have been asking for a step-by-step guide on how to advertise on Google for years, and it is finally available. Based on Canadian automotive data, whether you are a beginner looking to do the bare minimum, or a seasoned pro looking for how to stand out online, The Dealer Playbook breaks down exactly where you should be spending your marketing dollars. Continue reading “Dealers Asked, Google Listened: Google’s 2017 Dealer Playbook”

Automotive Innovations – what are shoppers looking for?

It’s always interesting to see the new and upcoming technology that luxury automakers reveal at their auto shows. The technology that is released today could potentially be commonplace for vehicles in the future – and not only for luxury vehicles. This can be traced back to the early versions of the seat belts that Saab offered in 1958, the first implementation of ABS.

An automobile full of new technology and innovation

Continue reading “Automotive Innovations – what are shoppers looking for?”

What Are Canadian Car Buyers Looking For & How Do You Appeal to Them?

According to recent Mintel data, Canadians are practical in what they look for within automotive innovations. While they show consideration for innovations that elevate comfort and convenience, they prioritize affordability, safety and reliability.  This is where smart communication through our social media platforms comes into play.  For each different manufacturer, competitive edge is not only within innovation, but in how they communicate their commitment to meeting consumers needs and wants.

Safety Features are always top of mind.  Canadians are most interested in the different safety features different manufactures offer in their vehicles.  As we find more and more interest in automated features – such as blind spot warning systems and rear and front cameras – dealers must make sure they are mentioning these features while also conveying that consumers should feel safe working with them.

Women are becoming more and more involved in the vehicle purchasing process and are showing interest in automotive innovations – especially safety features. However, they remain far less engaged in keeping up with the latest vehicle innovations.

Female buyers' leading emotions for mentions of buying a car
Female buyers’ leading emotions for mentions of buying a car

With women accounting for over one-third of online discussions around the car buying journey and showing a fair amount of anticipation, it is important to be sure we are still catering to them as an audience as well as what they are looking for in a vehicle. A great example of this is Mercedes-Benz’s ‘She’s Mercedes‘ campaign.

More people are also starting to show more interest in Hybrid/Electric vehicles when talking about automotive innovation.  Studies show that those who are engaging in online discussions or posting about automotive innovation are much more likely to be interested in hybrid and electric vehicles than the general population.  A 2016 report from Mintel’s New Cars – Canada showed that nearly a quarter of Canadians 18-24 years old are considering a hybrid/electric car for their next vehicle.

Making relevant posts to your Social Media platforms is an easy powerful way to promote your product.  If you want to learn more about how to be successful on Social Media, contact us today!

A Vending Machine for Supercars?

The year is 2017, and seeing the advances technology has made over the past few decades, it’s hard to imagine where we might go from here.

For now, it appears we’ve reached a milestone. As far as vending machines go, this may be the greatest iteration. A Singapore dealer, Autobahn Motors, has created a 15-story vending machine – its sole purpose? Dispensing supercars. Continue reading “A Vending Machine for Supercars?”

A Future Without Passwords?

"My password 123456" written on a paper with marker.The idea may seem far-fetched, but Google has already begun testing an alternative to the traditional alpha-numeric password.

Imagine being able to unlock your devices, profiles, personal accounts and much more without ever having to touch a keyboard. As it stands, the average consumer now has an average of 100 passwords to remember, and this number is continually on the rise. Google began the project, “Abacus”, with the intention to develop new indicators for users to use as passwords.

Abacus plans to kill passwords off not with one “secure” replacement, but by mixing multiple weaker indicators into one solid piece of inventory which collectively work to prove your identity. Beyond the obvious biometric indicators, such as face shape, smile and voice recognition, the program also hopes to incorporate some lesser known measures of identification (the way you move, swipe the screen, and hold the device, for example).

As separate entities it would be foolish to rely on any of these factors as security measures, but when combined they collectively serve as a measure that is 10x more secure than a single fingerprint.

Soon these features will be made available to third parties for testing, and some Android devices will have this as a beta option by the end of the year!

Most Googled Car Brand by Country

Ever wondered what brands are most popular in other countries? The British based auto parts retailer ‘Quickco” analyzed the most searched car brands on Google throughout 2016.

The most Googled car brands

As we can see from the findings, nationalist tendencies seem to be more apparent in Europe than the anywhere else; with Sweden, Germany, France and Italy all remaining homegrown in their brand searches.  As always, a few nations failed to provide data for the study, it’s hard to imagine what brand North Korea might have made up for this study.

Perhaps for some, the biggest surprise was to see BMW (a relatively small company) take 2nd place overall. However, if you’re a follower of BMW on social media this global presence is something you likely comprehend wholeheartedly. For the past three years BMW has created dedicated social marketing campaigns (remember the ‘Drift Mob’ video?)  to assure brand reputation and user engagement. With over 19 million fans of BMW’s Facebook page, the online initiatives seem to be paying off both at home in Europe and abroad as BMW sits only below Toyota in Google searches across the globe.

Fanatics: Don’t fear the hybrid

Hear the word “hybrid’’ and you’ll likely conjure up images of dull, wedge shaped vehicles being driven by environmentalists (cue DiCaprio and his Prius). Yet it’s been nearly 20 years since the hybrid drivetrain was introduced to our automotive markets, and throughout the nearly two decades that we’ve had hybrids available in North America, the connotations surrounding these vehicles have remained unchanged. Beyond the stigma given to seemingly all hybrid vehicles, there is a reality that many car enthusiasts (myself included) have to face. The technological advancements made to not only electrical motors but also to small displacement internal combustion engines mean hybrids no longer have to be synonymous with the meek image of a Toyota Prius or the Honda Insight. These progressions now present uncharted potential territory for performance advancements.

On a sunny spring day a Toyota Prius hybrid car drives through a tree lined road in Montana while on a road trip. The bright sun casts and in camera lens flare across the scene.

As supercar manufacturers have proven with their most recent offerings, the electric motor isn’t merely there to meet emission regulations or boost fuel efficiency, they play a substantial role in acceleration, handling and braking. Beyond the obvious ecological benefits, the use of electronic motors presents an entirely new set of possibilities to nearly all areas of a vehicles performance metrics. Engineers would not spend extended periods laboring over heavy batteries and potential cooling issues within performance vehicles if the substantial benefits of hybridization were not present.

Look across a list of sports car manufacturers and it appears each brand has their own interpretation of performance-hybrid vehicles on offer: Ferrari LaFerrari, McLaren P1, Porsche 918, Honda/Acura NSX, Koenissegg Regera, BMW i8. Though they utilize diverse layouts and technologies, the idea surrounding the electric motor’s input and applications remain relatively unchanged: provide power to the drivetrain ‘where and when’ traditional combustion engines fall short.

The McLaren P1 has an electric motorIn the McLaren P1 for example, the electric motor fills the void in propulsion when waiting on the V8’s twin Turbo’s to spool up, much like the Kinetic Energy Recovery System on a formula one car the hybrid set up minimizes lag stemming from the traditional motor. The Ferrari on the other hand, uses two electric motors. One dedicated to onboard electronics while the other connects directly to the drivetrain, the outcome is an increase of 163hp coupled with a lower center of gravity due to battery placement and an engine whose power band is no longer subject to an A/C Compressor or any other cabin elements. The Porsche 918 went a different direction entirely, attaching one electric motor to the front axle to power the front wheels giving the 918 the surefooted-ness characteristic of AWD when coming out of corners, while another motor is attached to the rear axle providing additional torque output to boost to the vehicles already potent 4.6l V8 engine. The Honda NSX, employs a similar idea, attaching one electric motor to each front wheel, relying on each individual motor to deliver distinctive torque vectoring while cornering.

There’s talk of the upcoming BMW and Toyota’s jointly developed sports car also being powered by a hybrid system. Volkswagen (who has made it clear that they plan to produce 20 EV’s by 2020) has already begun working on a hybrid setup for one of their most beloved models, the GTI. The Mark VIII Golf GTI is slated to reach dealers in 2020, and is said to be adopting a 48-volt electrical assist system distributed between both axles much like the Porsche 918’s current layout. As the technologies implemented in today’s super cars (LaFerrari, McLaren P1, Porsche 918) slowly become increasingly affordable, we will begin to see a trickle-down effect as affordable hybrids begin adopting these substantial technical advancements. It won’t be long until these applications collectively transform the hybrid from its meek ecologically conscious-image, to the responsible sports car of the future.

Affordable Luxury Vehicles: no longer a distant fantasy

That luxury vehicle you dreamed of all your life may no longer be a dream, but a reality. Luxury automakers seem to be shifting towards a broader client base, no longer only catering to the upper class. According to a study by Lightspeed/Mintel, 24% of drivers say affordability is the most important deciding factor when purchasing a vehicle, followed by advanced safety features and driving performance. But these vehicles are not keeping their high-end equipment without some cost.

Handsome men sitting in a luxury car at car dealership.

Of course, the high-end equipment luxury vehicles come with does incur some costs. Some examples of entry level luxury vehicles are:

Audi                                     A3 32800               Q3 34600

Acura                                   ILX 29590             RDX 42190

Mercedes-Benz                 CLA 35300             GLC 45150

BMW                                   3 Series 39900       X1 38880

Manufactures such as Audi, Acura, Mercedes-Benz and BMW have mid-size sedans starting as low as $29,590 for the Acura ILX and SUV’s starting at $34,600 for the Audi Q3. These prices are clearly higher than entry level vehicles from domestic/import manufactures but they are significantly lower than the entry prices of the past. Not stopping there, luxury automakers are offering comparable finance and lease rates, Acura for example is offering a 0.9% lease rate over 36 months on their 2017 RDX’s.

BMW SeriesWith higher payments, it’s no surprise that debt has increased. In the December 2015 Financial System Report, compiled by the Bank of Canada, it states that 8% of Canadians’ debt exceeds 350% of their annual disposable income; the percentage of Canadians with this amount of debt was a mere 4% in previous years. However, with a decrease in entry-level auto prices, it could be reasonable to anticipate a drop in Canadian debt. 65% of Canadians say they would consider a luxury vehicle, even though only 39% believe luxury vehicles are worth the price.

When you dissect the data, 69% of men aged 18-44 would consider a luxury brand and 76% of Chinese Canadians would lean towards a high end brand. Brands such as Jaguar are capitalizing on this data and gearing vehicles towards these demographics. Specifically, the “New Generation of Jaguar” campaign promoted the new F-Pace compact SUV which was aimed at the 18-44 male demographic. Despite the MSRP starting around $50,000, it comes comparably equipped to equivalent domestic/import SUV’s around that price. The data also shows that women make up 42% of engagement on luxury brands and that 60% of women plan on purchasing a new vehicle within the next three years.

It’s great to see luxury manufacturers creating entry-level models and offering incentives for those who didn’t think a luxury vehicle was within reach. Perhaps in the future, marketing teams will acknowledge women as an active consumer base and shift their marketing tactics toward all genders.

What do you think – would you consider a luxury vehicle at their entry-level pricing?

Consumers in Canada and U.S. Set Record Sales in 2016

Despite the drop in oil prices that resulted in lower sales for Albertans, Canadian and American automakers had record sales years in 2016. For the fourth consecutive year, Canadian automakers have exceeded their previous year’s sales.

Despite the price of oil, vehicle sales continue to rise.

In the Canadian sales race, Ford took the top spot with a 9% increase in deliveries, ahead of FCA Canada, which was the top dog in 2015. Automakers are noting consumers’ change of interest, specifically the shift from passenger cars toward trucks and SUV’s. This shift has affected their investments on a factory level across Mexico and the United States. In 2016, Nissan’s Rogue crossover surpassed the Altima as their best-selling vehicle, and the Ford F-Series outsold their passenger cars.

Despite the booming growth in 2016, experts anticipate a slight decline coming up in 2017. Dennis DesRosiers of DesRosiers Automotive Consultants Inc. expects a 3% decrease in sales for the Canadian Market. However, DesRosiers recognizes that a stabilizing and growing economy could push for another record breaking year in 2017. But no matter which way the sales go for 2017, experts agree that the Canadian auto market is not destined for failure, and sales likely won’t differentiate by more than 5%.

The outlook for 2017 is very positive overall.

Only time will tell whether the Canadian auto industry will thrive for a fifth year, or whether sales will decline. But one thing is for certain – it won’t break us. Douglas Porter, BMO chief economist said, “Even as the broader Canadian economy has struggled in the past two years, the consumer has just kept chugging along.”

What do you think the Canadian auto trends will be this year? Let us know in the comments below!

eMarketer’s Automotive StatPack, 2016

eMarketer has released their Automotive StatPack for 2016. This statpack gives an overview of digital automotive trends in 4 categories:

  1. Industry Sales & Transactions
  2. Ad Spending
  3. Buyers & Consumer Behavior
  4. Consumer Attitudes Toward New Automotive Technology

Below is a quick summary of the report; even though it contains primarily U.S. data, there are still trends in ad spending for OEMs and Dealers, as well as changes in consumer behavior that are relevant to the Canadian market.

Happiness of Buying a New Car Continue reading “eMarketer’s Automotive StatPack, 2016”

The Ford Bronco and Ranger Will Ride Again!

The Ford Motor Company announced on Monday at the Detroit Auto Show that the Ford Ranger will be returning again in 2019, followed by the Ford Bronco’s return in 2020.Ford Bronco Concept

Both of these models will be built at the Michigan Assembly Plant. The two models are expected to be built on a shared body-on-frame platform, which will create a midsize SUV and midsize pickup.  The Bronco has not been in production since 1996, while the Ranger is currently sold in other markets outside of the U.S. and Canada; we are likely to see the next generation of the model once it is available.

Ford Ranger ConceptFord has not speculated on technical details or images of the vehicles, yet, but they have suggested that the Bronco will offer some serious off road capability!

Ford is also planning to launch 13 new electric models by 2021, including hybrid models of the Mustang and the F-150.

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Autonomoose – Blackberrry’s self-driving car

Blackberry has just re-positioned themselves in the global marketplace. The longtime manufacturer of mobile phones is now shifting its focus and recently launched a new research center to develop self-driving cars.

autonomoose

Blackberry obtained the green light from Canadian authorities to test Ford’s Lincoln vehicles equipped with stand-alone driving software – a pilot project dubbed Autonomoose. Blackberry also signed an agreement to work directly with the automaker, which plans to launch their autonomous vehicles for car-sharing by 2021.

While Blackberry believes that it will take time for autonomous vehicles to be fully operational, this announcement demonstrates the appetite of computer giants to enter the automotive sector, as computer software and hardware are very likely to be key elements to the car of tomorrow. In fact, for many, this news may come as no surprise, as technology companies such as Google and Apple have already confirmed that they too are working on self-driving cars.

Luckily, the automobile division of Blackberry already boasts 400 employees, having already developed software currently embedded in vehicles. With safety and security at the forefront of self-driving car development, Blackberry’s high standard of security may give them a competitive advantage consumers seek. No matter the company, it’s great to see strides and significant financial contributions being made in the automotive space.

DriveTribe: A New Network for Auto Enthusiasts

Imagine a social platform, dedicated entirely to motoring; a digital media platform balancing enthusiast and professionally provided content. The idea is far from revolutionary, however, if accomplished on a large scale it will certainly play an influential role in the online advertising of vehicles.

DriveTribe

Never has a startup received such substantial backing from such reputable individuals in its early formation. DriveTribe has received funding from not only notable entrepreneurs but also has backing by the ex-Top Gear trio, Clarkson, May and Hammond.

“The site plans to build an engine to send content that will specifically target the disparate communities that make up car fans — from petrol heads to classic car aficionados. A versioning engine and multi-variate testing system will trial ‘hundreds of different versions’ of content on different segments of users, defined by age, gender, location and interests, with ‘optimal matches’ pushed directly to peoples’ social timelines through Facebook, Instagram, Twitter, Snapchat, etc. There will, of course, be iOS and Android apps, as well.”

After receiving my invite just prior to public launch, I spent some time poking around the app. What at first seemed to be little more than Instagram dedicated entirely to vehicles, soon led to a realization of the platforms marketing potential. Essentially, DriveTribe will allow a new sort of content targeting engine to emerge as individuals will be providing direct automotive related information. Information which will be aggregated much like Facebook and will allow automotive advertisers to target look-a-like crowds and distinct individuals according to group information and interests provided.

It seems fitting that this new site will segment users into separate tribes. As “Tribe” marketing has become a norm in the digital age, rapidly updated real time information provides the ability for advertisers to display highly pertinent ads to targeted online social communities.

A sleek red sports cardriving on an open road

To make money, the startup doesn’t plan to pursue traditional online display advertising. Instead, the object is to go after native advertising, or branded advertising, similar to what Vice Media does, said Mr. Schmitt.

“I think that is the way that advertising is going. I have a lot of car advertisers coming to us,” he said. “It allows them to target their advertising.”

To learn more about DriveTribe you can visit their website, and for more information on all things automotive marketing you can subscribe to our newsletter!

 

 

Black Friday Deals Increase Automotive Sales for November in the US & Canada

Black Friday SalesNow that a week has passed since Black Friday, the stats are rolling in.

The Black Friday deals were so successful this year that they actually increased automotive sales by 4% for the month in the U.S. This makes November, 2016 the highest on record with 1.38 million units sold, beating the previous 2001 record of 1.32 million according to Kelley Blue Book.

Since 2013, sales during the weekend after American Thanksgiving have been nearly double the sales during a typical November weekend, according to car shopping site Edmunds.com. Prior to 2013, automakers only saw a 39% increase in sales that weekend.

For November, some automakers said:
— General Motors sales rose 10%. Its Buick, GMC and Cadillac brands all saw double-digit percentage increases in sales, while Chevrolet sales were up 8%. Full-size SUVs were strong sellers; sales of the Cadillac Escalade were up 25% while sales of the Chevrolet Tahoe jumped 31%.
— Toyota Motor sales rose 4%. Luxury Lexus sales were down 1 percent but Toyota brand sales rose 5%. Toyota Highlander SUV sales jumped 67 percent
— Ford Motor sales rose 5%. Lincoln brand sales were up 19 percent thanks to the new Continental sedan and the redesigned MKX SUV. Sales of Ford’s best-seller, the F-Series pickup, were up 11 percent as the new F-250 and F-350 went on sale.
— Fiat Chrysler’s sales fell 14%. All brands saw double-digit percentage declines except Ram, which was up 12%
— Honda Motor sales rose 6.5%, a November record for the company. Luxury Acura sales dropped 5%, but Honda brand sales were up 8%. Honda’s best-seller, the Accord sedan, saw sales rise 6%.
— Nissan Motor sales were up 7.5%, which was also a November record. Nissan brand sales were up 8%, helped by strong sales of the newly redesigned Armada full-size SUV. Luxury Infiniti sales were up 4%.
— Hyundai Motor sales rose 4%, another November record. Sales of the Sonata and Elantra sedans fell, but the Santa Fe and Tucson SUVs both saw double-digit percentage gains.

Row of cars

This is only U.S. data, but November was a successful month for Canadian dealers as well. Toyota Canada has reported that their hybrids and trucks have set annual sales records, Kia Canada November sales are up 20.5%, and GMC and Ford both reported double-digit rises in Canadian sales.

Black Friday may have a bad rap in terms of large crowds and crazy customers, but it appears to be a very successful way to boost sales boost in the automotive industry!

Audi Test Drive Cube

In the past, I’ve heard auto enthusiasts and journalists describe Audi’s as unresponsive luxury vehicles; painting them out to be simple point A to B vehicles, void of inspiration and personality. Personally, I’ve never thought that was the case, I’ve always been a fan. From a marketing perspective however, Audi’s recent “Test Drive Cube” program for their new flagship A8 is one of the more inspirational actions we’ve seen from a German Automaker in recent years. Audi described this as the first test drive that comes directly to the customer. The pilot program was first lunched in Holland with nearly 50 potential customers having packages from Audi delivered to their doors. The contents of these packages? A solitary black cube with the familiar “Engine Start/Stop” Button located on a single façade of the cube.

audi test drive

Once pressed, the button serves as a transmitter to the nearest Audi dealership. After the dealership receives the signal, an Audi A8 is delivered to the customer in precisely 90 minutes.

Audi called this program the “Audi Test Drive cube” as following its delivery, the customer received an exclusive 24-hour period with Audi’s new flagship A8.

With this pilot program, Audi saw a 100% response rate and a 24% conversion rate, meaning that nearly 1 out of 5 clients felt motivated enough either by the programs exclusive treatment or the vehicle itself. Following the remarkably good response of customers the program was expanded to numerous other countries. You can see the cube in action here.

Millennials’ Growing Purchasing Power

Good news for the auto industry!

Contrary to the popular belief that auto sales would dwindle with the rise of millennials, it turns out that they are actually longing for vehicle ownership. Turns out the selfie-generation is also the generation of self-transportation.

Happy millennials on vacation

Young people have moved beyond ride-sharing services. This is indicated in studies showing that companies like Uber and TappCar are used only for specific events and purposes, which suggests that ride-sharing services could become a means of replacing cabs, but not necessarily car ownership. In 2014, for the first time, millennials purchased more vehicles than generation X. As time goes on, we can expect further purchasing power from millennials to dictate automotive trends. In fact, the growing amount of choices in the sport-utility segment are a reflection of millennial trends.

You can read more about this study here!