Car buyers hesitant to buy from bankrupt automakers

In their efforts to get federal aid, Chrysler and General Motors have adamantly resisted the bankruptcy route, fearing that consumers would be reluctant to buy cars from a bankrupt automaker. Well, according to a new pulse survey from the Consumer Reports National Research Center, they’re right!

More than three-quarters (78 percent) of respondents said they were unlikely to consider buying a new car from an automaker in bankruptcy; 64 percent were very unlikely. Women were particularly resistant; 83 percent said they are unlikely to consider buying and 70 percent said very unlikely.

Similarly, more than eight in 10 (82 percent) respondents said they are unlikely to consider buying a new car from a division that is being sold or phased out; 63 percent said very unlikely. More older consumers and women would steer clear of a division such--at least 87 percent said they are unlikely to consider purchasing and seven in 10 responded very unlikely.

Methodology

The Consumer Reports National Research Center conducted a random telephone survey using a nationally representative sample of households that own at least one vehicle. From March 12-15, 2009, 1,005 interviews were completed among adults aged 18 year or older.

Read:

Obama: Chrysler, GM plans inadequate, demands further restructuring

U.S. government to back Chrysler, GM car warranties
Q&A: What happens if an automaker goes bankrupt?”
Auto suppliers to receive up to $5 billion in aid

--Jeff Bartlett

Comments

[crispinpierce]

It would be interesting to know of consumer's perspective on buying cars from automakers who are asking for, and receiving, government bailouts. Is Ford fairing better than GM and Chrysler in this regard? Are Japanese brands fairing better yet?

[rhodies]

Our family Chrysler loyalty now in question. Started off with a '66 Dodge Dart which I drove daily for 27 years, followed by a'71 V-8 Plymouth (273,000+ miles), a '78 Dodge Diplomate (240,000 miles), inherited a '89 Dodge Spirit (gave it away at 183,000 miles), a '91 Dodge Dynasty (maintenance doomed this vehicle), and currently a '99 Dodge Intrepid (103,000 miles). Cost for maintainence for the '99 Dodge to date has been a bit more than $3000. Cost for maintainence for wife's 2000 Honda Civic (118,000 miles), ~ $240. Have used the same "shade tree" mechanic for over thirty years and have never had to question his costs. But since he is now 72 years old, our options will become very limited and our support of high maintenence American cars will now have to come to a close. Since we are now retired, we need cars that take care of us rather than we take care of them. Looks like Honda & Toyota will be in a futures.

[Gerald Cluney]

My decision to switch last summer to Honda from a Big 3 (GM) brand was made because of "long-time" indications (several years)that quality and emphasis on interests of car buyers was low on Big 3 (particularly GM and Chrysler) lists of manufacturing/
marketing priorities. The Big 3 clearly abdicated responsibily to car buyers to (over)line their own pockets and those of the CAW/UAW unions - nothing then left for technology/quality improvements leaving them "too" far behind Toyota and Honda and such good brands. Too late now for GM and Chrysler to catch up; I oppose my taxes being used to prop up greed and incompetence.

[crispinpierce]

It does appear, at least from a recent Rasmussen report, that consumers are staying away from GM and Chrysler for now:

"A survey released this month by polling firm Rasmussen Reports found that 88% of Americans would prefer not to buy a car from an automaker receiving government aid. That's worse than the 63% who said they would eschew buying from a bankrupt car company." http://www.latimes.com/business/la-fi-auto-bailout29-2009mar29,0,408241.story

[Derrick G]

Here are a few more results from the CNW study not mentioned in the LA Times story:

Honda's consideration rate is up 13%, Hyundai's is up 59%, and Kia's is up 50%. No others were mentioned. See: http://www.autoblog.com/2009/03/20/study-more-buyers-avoiding-gm-chrysler-during-rescue

[Roland]

It is difficult to say what I will do in the short run. My Hyundai Accent is due to be replaced and my Ford F150 lease is ending. Do I go for the great deals GM is offering and take that chance. It I do does it mean if they go bankrupt they will not honour their warranties: and will parts no longer be made available for newer vehicles. I like GM in the past, but went elsewhere because their prices increased, but am now seeing that with the Hyundai Accent which I feel is over priced as well as the Honda and Toyota. What is a person to do?

[ashley]

i have a 1975 dodge darta igot it for my 16th birthday & i'm 23 now & trying to find out how much its worth... any ideas?