Covering First Quarter 2015 Volume 15, Number 2 San Diego Auto Outlook

Comprehensive information on the San Diego County new vehicle market

FORECAST Market Posts Increase in First Quarter of 2015 5.1% improvement predicted for entire year

Below is a summary of nine key trends and to 42.6% this year. This followed the 1.4 point while Ford F-Series and Honda CR-V trailed developments in the San Diego County new increase from 2013 to 2014. the Tacoma. vehicle market. Alternative powertrain vehicle sales fall Japanese brands gain ground in 2015 County market gets off to good start in County sales of hybrid and electric cars and Japanese brands accounted for a larger chunk 2015; increase is above Nation trucks fell 13.1% so far this year, while the of the county market so far this year, with County new retail registrations were up 8.2% overall market improved. Market share slipped share increasing from 51.5% during the first for the first three months of this year (March to 7.1%. three months of 2014 to 52.1% this year. figures were estimated) versus a year earlier, above the 2.2% uptick in the National market. Toyota, Ford, Honda, Nissan, and Chevrolet are leaders in county market Percent Change in County Sixth consecutive annual increase likely in Toyota was the best selling brand so far this Light Truck and Car Registrations 2015 year, with a 19.1% share. Honda’s county YTD ‘15 thru March* vs. YTD ‘14 County new retail light vehicle registrations are share was 10.4%, well above its 9.2% share Light Trucks (Pickups, SUVs, and Vans) predicted to increase 5.1% from ‘14 to ‘15. in the U.S.

Market has come a long way from depths of Chrysler, Porsche, GMC, Mitsubishi, and UP 2009 sales trough Subaru gain a lot of ground early this year 13.1% As shown below, the county new vehicle mar- New retail registrations for each of these five ket has recovered steadily during the past six brands were up more than 27% so far in 2015. Passenger Cars years. Registrations this year are projected to exceed ‘09 levels by nearly 77,000 units. Toyota Corolla best-selling car in county UP market; Tacoma is light truck leader 4.8% Trucks grab a larger share of county market Honda Civic and Toyota Prius were ranked sec- Light truck market share increased from ond and third behind Corolla in the car market, Source: IHS Automotive. 40.8% during the first three months of 2014 *March ‘15 figures estimated by Auto Outlook.

Annual Trend in County Market Market Summary

180,000 160,000 YTD '14 YTD '15 % Chg. Mkt. Share thru Mar thru Mar* '14 to '15 YTD '15* 140,000 154,500 146,943 TOTAL 33,590 36,332 8.2% 120,000 139,366

100,000 126,267 Car 19,902 20,852 4.8% 57.4% 80,000 99,199 Light Truck 13,688 15,480 13.1% 42.6% 60,000 102,624 87,573 40,000 77,685 Domestic 8,564 9,019 5.3% 24.8%

New light vehicle registrations 20,000 European 5,214 5,539 6.2% 15.2% 0 Japanese 17,300 18,915 9.3% 52.1% 2008 2009 2010 2011 2012 2013 2014 2015 Korean 2,512 2,859 13.8% 7.9% Forecast Historical Data Source: IHS Automotive. Source: IHS Automotive. Domestic brands consists of vehicles sold by GM, Ford, FCA (excluding FIAT), and The graph above shows annual new retail light vehicle registrations in the county from 2008 Tesla. *Figures for March, 2015 were estimated by Auto Outlook. Historical figures thru 2014 and Auto Outlook’s projection for 2015. were updated and will differ slightly from those presented in previous issues. Page 2 San Diego Auto Outlook MARKET TRACKER: QUARTERLY RESULTS County Market Increased 8.2% in 1st Quarter of ‘15 vs. 2.2% in U.S.

QUARTERLY TREND QUARTERLY PERSPECTIVE Percent Change in New Vehicle Market Five Years of First Quarter Results County and U.S. in County Market 40000 9.0% County 35000 8.0% U.S.

7.0% 30000

6.0% 25000

5.0% 20000 The county market improved at a The market was up by nearly 4.0% faster pace than the U.S. in the 12,000 units in the First Quarter 1st Quarter of 2015. 15000 of 2015 vs. 2011. 3.0% % change versus year earlier

New retail light vehicle registrations 10000 2.0%

1.0% 5000

0.0% Q2 '14 Q3 '14 Q4 '14 Q1 '15* 0 Q1 '11 Q1 '12 Q1 '13 Q1 '14 Q1 '15* County 2.5% 6.6% 7.0% 8.2% Regs. 24383 28765 31771 33590 36332 U.S. 6.5% 6.1% 6.6% 2.2% First Quarter registrations during past five years

* Figures for First Quarter 2015 were estimated by Auto Outlook based on * Figures for First Quarter 2015 were estimated by Auto Outlook data for January and February. based on data for January and February. Data Source: IHS Automotive. Data Source: IHS Automotive.

San Diego Auto Outlook Covering First Quarter 2015

Published by: Auto Outlook, Inc. PO Box 390 Exton, PA 19341 Phone: 800-206-0102 EMail: [email protected] Editor: Jeffrey A. Foltz

Reproduction, including photocopying of this publication in whole or in part, is prohibited without the express permission of Auto Outlook, Inc. Any material quoted must be attributed to San Diego Auto Outlook, published by Auto Outlook, Inc. on behalf of the New Car Dealers Association San Diego County, and must also include the statement: “Data Source: IHS Automotive.” Unforeseen events affect the forecast projections. Consequently, Auto Outlook is not responsible for management decisions based on the content of San Diego Auto Outlook. Covering First Quarter 2015 Page 3 MARKET TRACKER: BRAND MARKET SHARE MARKET TRACKER: HYBRID AND ELECTRIC VEHICLES Japanese Brands Are Up Hybrid/Electric Share Declines

Change in County Market Share Quarterly Alternative Powertrain Market Share YTD 2015 thru March* vs. YTD 2014 (includes hybrid and electric vehicles)

12.0% Japanese 0.6 Japanese brand 10.0% share increased Korean by 0.6 points. 0.4 8.0%

6.0% European -0.3 Trendline 4.0% Alternative powertrain market share has trended Domestic -0.7 2.0% lower over the past three years, and fell to 7.1% in the First Quarter of 2015.

-1.5 -1.0 -0.5 0.0 0.5 1.0 1.5 0.0% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Change in market share '12 '12 '12 '13 '13 '13 '13 '14 '14 14 14 15* The graph above shows the change in year-to-date market share The graph above shows hybrid powertrain and electric vehicle quarterly market share in the for four primary brand segments. *Figures for March, 2015 were county. The line shows market share trend over the past 12 quarters. *First Quarter 2015 estimated by Auto Outlook. Data Source: IHS Automotive. includes January and February. Source: IHS Automotive. MARKET TRACKER: SEGMENTS Sub Compact Car Segment Leads County Market

San Diego County Segment Market Share Review Market Share Market Share Change in share Best selling model Segment YTD ‘14 thru February YTD ‘15 thru February YTD ‘14 to ‘15 in segment Sub Compact Car 24.1 22.9 -1.2 Toyota Corolla Standard Mid Size Car 15.0 14.5 -0.5 Honda Accord Compact SUV 14.0 13.7 -0.3 Honda CR-V Near Luxury Car 6.0 6.3 0.3 Lexus IS Full Size Pickup 5.9 6.0 0.1 Ford F Series Mid Size SUV 3 Rows 5.0 5.4 0.4 Ford Explorer Entry Car 5.2 4.8 -0.4 Honda Fit Luxury and Sports Cars 4.2 4.0 -0.2 Tesla Model S Mid Size Luxury SUV 3.7 3.9 0.2 Lexus RX Compact Pickup 2.8 3.5 0.7 Toyota Tacoma Compact Luxury SUV 2.2 2.9 0.7 Acura RDX Mid Size SUV 2 Rows 3.2 2.8 -0.4 Ford Edge Mini Van 2.4 2.3 -0.1 Honda Odyssey Sport Compact Car 1.8 2.0 0.2 Ford Mustang Entry Luxury Car 1.4 1.6 0.2 Mercedes CLA-Class Large Mid Size Car 1.1 1.1 0.0 Dodge Charger Full Size SUV 0.9 1.0 0.1 Chevrolet Tahoe Full Size Van 0.8 0.9 0.1 Nissan NV Full Size Luxury SUV 0.4 0.5 0.1 Cadillac Escalade

The table above shows San Diego county market share for 19 vehicle segments during the first two months of 2014 and 2015, and the change in market share over the period. The best selling model in each segment is also shown. Segments are ranked from top to bottom based on 2015 share. Most popular segment in the county is Compact SUV. Compact Pickup and Compact Luxury SUV had the largest gains. Data Source: IHS Automotive. Page 4 San Diego Auto Outlook BRAND SCOREBOARD - PART ONE Chrysler and Porsche Post Large Percentage Gains GMC, Mitsubishi, and Subaru are also up sharply

The graphs below provide a comparative evaluation of brand sales performance in the county market. They show the year-to-date percent change in registrations for each brand, organized by category (i.e., Detroit Three, European, Japanese, and Korean). Percent Change in County New Retail Light Vehicle Registrations YTD 2015 thru March* vs. YTD 2014

Chrysler 91.9%

Tesla 71.7%

GMC 33.8%

Lincoln 16.0% Domestic Brands Ram 9.4%

Jeep 6.1%

Cadillac 4.7%

Chevrolet 2.6%

Ford 1.4%

Buick -2.5%

Dodge -6.8%

Porsche 44.9%

MINI 25.4% European Land Rover 23.5% Brands

Mercedes 20.4%

Volvo 16.3%

Audi 13.1% Chrysler and Porsche had the biggest increases. Mitsubishi had the largest increase BMW 9.6% among Japanese brands. Volkswagen -10.6%

FIAT -23.3%

Mitsubishi 29.5%

Subaru 27.2%

Lexus 15.9%

Honda 11.4% Japanese Brands Nissan 9.2%

Mazda 8.6%

Infiniti 8.2%

Acura 8.2%

Toyota 3.6%

Kia 20.7% Korean Hyundai 5.9% Brands

-40.0% -20.0% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0%

*Figures for March, 2015 were estimated by Auto Outlook. Source: IHS Automotive. Covering First Quarter 2015 Page 5 BRAND SCOREBOARD - PART TWO Toyota is Top Selling Brand in County Market Lexus share of county market exceeds U.S. by 1.7 points

The graph below provides a comparison of San Diego County and U.S. new retail market share during the first three months of this year for the top 20 selling brands in the county. Brands are positioned on the graph from top to bottom based on county market share. Toyota was the county leader, accounting for 19.1% of the market, well above its 13.3% share in the Nation.

County and U.S. Market Share - YTD 2015 thru March*

19.1% Toyota 13.3%

10.5% Ford 12.6%

10.4% Honda 9.2%

9.0% Nissan 7.8%

4.6% Chevrolet 10.2%

4.2% Kia 3.8%

4.1% Lexus 2.4%

3.7% Hyundai 4.3%

3.6% BMW 2.3%

3.6% Subaru 4.2%

Jeep 3.4% 4.8% Toyota, Lexus, BMW, VW, Nissan, and Honda 3.2% county market shares were well above U.S. County U.S. Volkswagen 1.9%

3.1% Mazda 1.9%

3.0% Mercedes 2.3%

1.6% Audi 1.2%

1.4% Dodge 2.7%

1.3% Acura 1.2%

1.2% GMC 3.2%

1.1% Ram 2.7%

0.9% Infiniti 0.8%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% Market Share

*Figures for March, 2015 were estimated. Source: IHS Automotive. Page 6 San Diego Auto Outlook

BRAND SCOREBOARD-PART THREE Toyota, Nissan, and Ford Have Big Gains During Past 5 Years County registrations for each of the brands were up more than 7,300 units between 2009 and 2014

Since the new vehicle market hit bottom in the graph below, some have had bigger gains by the green bars and represented by the left 2009, the recovery has been strong and than others. axis). Percentage change (shown by the or- steady. New vehicle sales increased for five ange bars and represented by the right axis) is straight years, and were 89% higher in 2014 The graph provides a thorough picture of also shown for each brand. than in 2009. Not surprisingly, nearly all brand sales performance by showing both the brands posted impressive gains during the five unit and percentage gains between 2009 and year period, and among the top 20 sellers no 2014. Brands are positioned from left to right brands had a decline. However, as shown on based on the unit gain in registrations (shown

Unit and Percent Change in County New Retail Light Vehicle Registrations 2014 vs. 2009

10000 450%

Toyota had the highest unit gain Green bars show unit change in registrations in registrations, up by 9,278. Orange bars show percent change in registrations 9000 400%

8000 Kia had the highest percentage 350% gain, up 405%.

7000 300%

6000

250%

5000

200%

4000

150%

Unit change in registrations - 2009 to 2014 (green bars) 3000 Percent change in registrations - 2009 to 2014 (orange bars)

100% 2000

50% 1000

0 0%

Source: IHS Automotive.. Covering First Quarter 2015 Page 7

MODEL SCOREBOARD Corolla is Best Selling Car; Tacoma is Light Truck Leader Sentra and Pilot have big market share gains

The two graphs below show market shares in the county car and light truck markets during the first two months of 2014 and 2015. Includes the top ten selling car and light truck models.

Change in Market Share for Top 10 Selling Cars - YTD 2015 thru February vs. YTD 2014

7.0% Corolla and Sentra market shares were up. 2014 YTD 2015 YTD 6.0%

5.0%

4.0%

Market Share 3.0%

2.0%

1.0%

0.0% Toyota Corolla Honda Civic Toyota Prius Honda Accord Toyota Camry Nissan Sentra Nissan Altima Ford Focus Mazda 3 Kia Optima Source: IHS Automotive.

Change in Market Share for Top 10 Selling Light Trucks - YTD 2015 thru February vs. YTD 2014

6.0% Market shares for Pilot and CR-V improved. 2014 YTD 5.0% 2015 YTD

4.0%

3.0% Market Share

2.0%

1.0%

0.0% Toyota Ford F Series Honda CR-V Toyota RAV4 Nissan Rogue Chevrolet Ford Escape Ram Ford Explorer Honda Pilot Tacoma Silverado Source: IHS Automotive. Page 8 San Diego Auto Outlook

Brand Registrations Report San Diego County New Retail Car and Light Truck Registrations First Quarter* Annual Totals Registrations Market Share (%) Registrations Market Share (%) 1Q 2014 1Q 2015 % change 1Q 2014 1Q 2015 Change 2013 2014 % change 2013 2014 Change TOTAL 33,590 36,332 8.2 139,366 146,943 5.4 Cars 19,902 20,852 4.8 59.2 57.4 -1.8 85,502 88,101 3.0 61.4 60.0 -1.4 Light Trucks 13,688 15,480 13.1 40.8 42.6 1.8 53,864 58,842 9.2 38.6 40.0 1.4 Domestic Brands 8,564 9,019 5.3 25.5 24.8 -0.7 35,095 36,298 3.4 25.2 24.7 -0.5 European Brands 5,214 5,539 6.2 15.5 15.2 -0.3 22,790 23,543 3.3 16.4 16.0 -0.4 Japanese Brands 17,300 18,915 9.3 51.5 52.1 0.6 70,593 76,399 8.2 50.7 52.0 1.3 Korean Brands 2,512 2,859 13.8 7.5 7.9 0.4 10,888 10,703 -1.7 7.8 7.3 -0.5 Acura 441 477 8.2 1.3 1.3 0.0 1,849 1,810 -2.1 1.3 1.2 -0.1 Audi 510 577 13.1 1.5 1.6 0.1 2,106 2,393 13.6 1.5 1.6 0.1 BMW 1,210 1,326 9.6 3.6 3.6 0.0 5,449 5,838 7.1 3.9 4.0 0.1 Buick 119 116 -2.5 0.4 0.3 -0.1 598 527 -11.9 0.4 0.4 0.0 Cadillac 254 266 4.7 0.8 0.7 -0.1 1,090 1,017 -6.7 0.8 0.7 -0.1 Chevrolet 1,637 1,679 2.6 4.9 4.6 -0.3 6,949 7,324 5.4 5.0 5.0 0.0 Chrysler 123 236 91.9 0.4 0.6 0.2 610 663 8.7 0.4 0.5 0.1 Dodge 560 522 -6.8 1.7 1.4 -0.3 2,369 2,183 -7.9 1.7 1.5 -0.2 FIAT 317 243 -23.3 0.9 0.7 -0.2 1,050 1,235 17.6 0.8 0.8 0.0 Ford 3,756 3,809 1.4 11.2 10.5 -0.7 15,886 15,435 -2.8 11.4 10.5 -0.9 GMC 328 439 33.8 1.0 1.2 0.2 1,419 1,603 13.0 1.0 1.1 0.1 Honda 3,380 3,766 11.4 10.1 10.4 0.3 15,922 16,451 3.3 11.4 11.2 -0.2 Hyundai 1,258 1,332 5.9 3.7 3.7 0.0 5,457 5,413 -0.8 3.9 3.7 -0.2 Infiniti 305 330 8.2 0.9 0.9 0.0 1,407 1,186 -15.7 1.0 0.8 -0.2 Jaguar 68 47 -30.9 0.2 0.1 -0.1 226 233 3.1 0.2 0.2 0.0 Jeep 1,173 1,245 6.1 3.5 3.4 -0.1 3,775 4,800 27.2 2.7 3.3 0.6 Kia 1,254 1,514 20.7 3.7 4.2 0.5 5,431 5,290 -2.6 3.9 3.6 -0.3 Land Rover 234 289 23.5 0.7 0.8 0.1 849 861 1.4 0.6 0.6 0.0 Lexus 1,271 1,473 15.9 3.8 4.1 0.3 4,886 5,593 14.5 3.5 3.8 0.3 Lincoln 131 152 16.0 0.4 0.4 0.0 531 555 4.5 0.4 0.4 0.0 Mazda 1,026 1,114 8.6 3.1 3.1 0.0 3,962 4,475 12.9 2.8 3.0 0.2 Mercedes 905 1,090 20.4 2.7 3.0 0.3 4,143 4,482 8.2 3.0 3.1 0.1 MINI 224 281 25.4 0.7 0.8 0.1 1,147 1,019 -11.2 0.8 0.7 -0.1 Mitsubishi 132 171 29.5 0.4 0.5 0.1 483 522 8.1 0.3 0.4 0.1 Nissan 3,008 3,284 9.2 9.0 9.0 0.0 11,166 13,128 17.6 8.0 8.9 0.9 Other 147 134 -8.8 0.4 0.4 0.0 452 622 37.6 0.3 0.4 0.1 Porsche 178 258 44.9 0.5 0.7 0.2 694 753 8.5 0.5 0.5 0.0 Ram 363 397 9.4 1.1 1.1 0.0 1,171 1,703 45.4 0.8 1.2 0.4 Subaru 1,027 1,306 27.2 3.1 3.6 0.5 3,610 4,542 25.8 2.6 3.1 0.5 Tesla 113 194 71.7 0.3 0.5 0.2 653 458 -29.9 0.5 0.3 -0.2 Toyota 6,706 6,949 3.6 20.0 19.1 -0.9 27,299 28,676 5.0 19.6 19.5 -0.1 Volkswagen 1,297 1,159 -10.6 3.9 3.2 -0.7 6,029 5,550 -7.9 4.3 3.8 -0.5 Volvo 135 157 16.3 0.4 0.4 0.0 698 603 -13.6 0.5 0.4 -0.1 *March 2015 figures were estimated by Auto Outlook. Source: IHS Automotive.

San Diego Auto Outlook is distributed free of charge to members San Diego Auto Outlook of the New Car Dealers Association San Diego County. The publi- cation is sponsored and supported by the Association. San Diego Auto Outlook is published and edited by Auto Outlook, Inc., an in- Published by: Auto Outlook, Inc. dependent automotive market analysis firm. Opinions expressed PO Box 390, Exton, PA 19341 are solely those of Auto Outlook, Inc., and are not necessarily shared by the Association. Phone: 800-206-0102 EMail: [email protected]

Copyright Auto Outlook, Inc., April, 2015 Covering First Quarter 2015 Page 9

USED VEHICLE MARKET REPORT County Used Vehicle Market Falls in Early 2015 Used vehicle registrations declined by 5% thru February of this year

Below is a list of key trends in the San Diego County retail San Diego County Retail Used Light Vehicle Registrations used vehicle market: YTD thru February Registrations % Change Market Share • Retail used car and light truck registrations in the YTD '14 YTD '15 '14 TO '15 YTD '14 YTD '15 county fell 5% during the first two months of 2015 TOTAL 50,890 48,323 -5.0% versus a year earlier. Cars 30,779 28,954 -5.9% 60.5% 59.9% • As shown on the graph below, the gap between the Light Trucks 20,111 19,369 -3.7% 39.5% 40.1% size of the new and used vehicle markets (vehicles six Detroit Three 18,595 17,517 -5.8% 36.5% 36.2% year old or newer) remained fairly wide early this year. New vehicle registrations increased 10.7% in January European 8,019 7,767 -3.1% 15.8% 16.1% and February of this year (versus a year earlier), while Japanese 22,349 20,872 -6.6% 43.9% 43.2% 6 year old or newer used registrations declined 5.7%. Korean 1,927 2,167 12.5% 3.8% 4.5% Source: IHS Automotive. • The 5 year-old used vehicle market was relatively strong Percent Change in County Retail Used Registrations early this year. As shown on the graph to the right, 5 by Vehicle Age, YTD 2015 thru February vs. YTD 2014 year old used vehicle registrations were up 13.6%. The 20.0% 13.6% 6 year old market slumped due to weak new vehicle 6.2% sales in 2009. 10.0% 0.0% • Used light truck registrations declined 3.7%, while cars -10.0% -2.5% were off by 5.9%. -7.5% -7% -20.0% • Toyota Camry was the best-selling model in the county -18.9% -30.0% among 6 year old or newer vehicles. Hyundai Elantra -40.0% registrations were up sharply. -36.9% -50.0% • Among the top 15 selling brands, Hyundai, Mercedes, 7 yrs. old 6 yrs. old 5 yrs. old 4 yrs. old 3 yrs. old 2 yrs. old 1 yr. or newer Acura, and Volkswagen were the only brands to have an increase in used registrations so far this year. Source: IHS Automotive.

San Diego County New and Used Retail Registrations - Three Month Moving Average (used only includes vehicles 6 years old or newer)

14000

12000

10000

8000 Used 6000 New

4000

2000

0 Jul-12 Jul-13 Jul-14 Jun-12 Oct-12 Apr-13 Jun-13 Oct-13 Jan-13 Apr-14 Jun-14 Oct-14 Jan-14 Feb-13 Feb-14 Aug-12 Aug-13 Aug-14 Nov-12 Mar-13 Nov-13 Mar-14 Nov-14 Dec-12 Dec-13 Dec-14 Sep-12 Sep-13 Sep-14 Jan-15 Feb-15 May-13 May-14 Source: IHS Automotive. Page 10 San Diego Auto Outlook TOP SELLING MODELS Toyota Corolla Best Seller in County Market Hyundai Elantra has big Percentage Gain Registrations (ytd ‘15 thru Feb.) and Percent Change in registrations (ytd ‘15 thru Feb. vs. ytd ‘14) Top 20 Selling Models (6 years old or newer) Percent change in registrations (shown as thin red bars) -25% 0% 25% 50% Toyota Camry Toyota Corolla Nissan Altima Volkswagen Jetta Honda Civic BMW 3-Series Toyota Prius Nissan Sentra The thick blue bars on Ford Focus Unit regs. the graph show unit % change in regs. Ford F Series registrations (bottom Nissan Versa axis), and the thin red Honda Accord bars show the percent Mercedes-Benz C-Class change (top axis). Toyota Tacoma Hyundai Elantra Ford Fusion Hyundai Sonata Ford Escape Mazda 3 Nissan Rogue -250 0 250 500 Unit registrations (shown as wide blue bars) Source: IHS Automotive.

USED VEHICLE BRAND SCOREBOARD Used Hyundai Registrations Increase 16% Registrations for three other brands move higher The graph below shows the percent change in used registrations for the top 15 selling makes during the first 2 months of 2015 vs. year earlier. Percent Change in Used Registrations (top 15 brands in county) - YTD ‘15 thru February vs. YTD ‘14 20.0% 16.0% 15.0% 10.0% 4.7% 3.9% 5.0% 1.0% 0.0% -5.0% -2.0% -3.8% -4.5% -5.1% -5.3% -5.5% -10.0% -6.1% -6.1% -6.9% -8.4% -9.6% -15.0%

Source: IHS Automotive.