Premium surround sound systems and high-definition (HD) radio are highly attractive features consumers would like to see in their new vehicles based on their estimated market prices, and consumers prefer to pay a one-time fee over a monthly subscription for satellite radio, according to the JD Power and Associates 2005 US automotive emerging technologies study.
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The study was based on responses from more than 17,000 consumers and was designed to measure consumer familiarity, interest and purchase intent for emerging automotive technologies. It measured consumer familiarity, interest and purchase intent for emerging automotive technologies both before and after an estimated market value was revealed.
While consumer interest in new technologies typically drops after a price point is revealed, relative interest in premium surround sound and HD radio actually improved dramatically after the market price was provided.
Premium surround sound, which ranked sixth in consumer interest before the price was revealed, moved to second after consumers learned its market price ($US400).
With a realistic market price of just $150, the HD radio-compatible receiver jumped from 16th in initial interest to third after pricing was revealed.
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By GlobalData“What is truly surprising is that among those interested in equipping their next new vehicle with the premium surround sound feature at $400, nearly 80% of those were willing to pay $800 for a branded system,” said JD Power spokesman Lawrence Wu.
“This suggests that automakers and audio suppliers could add value to their products for consumers, while increasing their returns. While we have seen the availability of branded sound systems increase the past few years, it’s evident from this research that there is sufficient consumer demand to warrant equipping a much broader vehicle segment base.”
Consumers still showed more interest in satellite radio than HD radio prior to the introduction of price, but interest fell below HD radio at the realistic market price of $12.95 per month for satellite radio.
The study showed that more consumers were willing to pay a one-time fee as opposed to paying monthly for the service.
“Even though satellite radio is at an advantage over HD radio by offering commercial-free content and coast-to-coast coverage, interest in HD radio is higher than satellite radio after the introduction of price,” said Wu. “In general, consumers would rather pay once for a feature and have been reluctant to embrace subscription fees. This is evident in the trade-off exercise in this year’s study in which almost twice as many consumers chose lifetime (life of vehicle) satellite radio with a one-time $499 subscription fee compared to a one-year option.”
Safety related technologies are still a top priority for consumers. The study dound consumers’ four most desired features relate to enhancing the safety and/or security of vehicle occupants. Run-flat tyres were the most desired item among technologies included in the study before consumers were shown the fair market value. Night vision, stability control and blind spot warning followed in consumer interest before prices were introduced.
Stability control jumped to first place after consumers were made aware of its $300 price tag, while run-flat tyres dropped to fourth after its $600 price was revealed. Consumer interest in night vision decreased significantly once consumers were presented with the realistic market price of $1,500.
