Trading Up

By Deb Acord

CTW Features

 

Americans love technology. The quest for the newest gadgets that keep us connected anytime, anywhere, fuels our society.

So it shouldn’t be surprising to learn that consumers are beginning to view the switch to a new vehicle much like an upgrade to the newest smartphone. An online leasing company found that people are escaping car leases early because they want the newest technology and they want it now.

Although car buyers may be keeping their cars longer – an average of more than five years, according to J.D. Power and Associates – those who lease are driven more by thirst for technology than by their desire for longevity.

LeaseTrader.com found that its lease-escape rate (the rate of leaving a lease before it is fulfilled) jumped 37.6 percent since 2009, a trend the company chalks up to drivers who crave improved technology.

Before 2009, more than 85 percent of all the early trade-ins on the part of drivers looking for snazzier technology involved leases for luxury and European brands such as BMW, Mercedes-Benz, Audi, Infinity and Lexus.

But since 2009 the technology upgrade crowd has shifted dramatically, with more than 16 percent of the technology trade-ins involving Ford vehicles, and 11 percent involving GM vehicles.

What are drivers looking for? An October 2011 survey of 500 car owners by Harman, a manufacturer of audio systems for the automotive market, suggests drivers want to be more connected and informed on the road. A majority want Internet radio in the car, real-time traffic updates and voice-controlled entertainment systems.

• 83 percent of respondents want a car navigation system that receives real-time traffic updates

• 64 percent want access to Internet music-streaming sites

• 80 percent would pay a premium for voice control of navigation, music and texting

• 68 percent want a car that seamlessly integrates with smartphones, MP3 players, and other electronics they already own

• Top cars for technology trades: Ford Edge, Lincoln MKZ, Chevy Cruze and Audi A6.

"Drivers are saying they want technology to be intuitive and easy to manage," says Sachin Lawande, Harman chief technology officer. "Vehicle technology needs to keep improving to make managing busy lives easier."

The automotive industry is embracing the techno race. At least six of the top 10 auto manufacturers will exhibit at the 2012 Consumer Electronics show in Las Vegas, a record number. The show sponsor predicts sales of factory-installed vehicle technologies will increase by 16 percent, to nearly $7 billion. About 15 percent of U.S. households now own a vehicle with a connected communication/entertainment system, according to Consumer Electronics Association research. The group expects this figure to rise quickly in the coming years as car companies make these solutions available across more models.

 

Featured Stories

Advertisement

PLAN AHEAD

Top Trending Videos