Fourth Edition 2006 - HADA - Hawaii Automobile Dealers Association

The Official Publication of the Hawaii Automobile Dealers Association
Fourth Edition 2006
StanMasamitsu
HADA’s Nominee for the Time Magazine
2007 Quality Dealer of the Year
Also Inside:
• Seven Cars for Seven Teachers
• Kauai 2006 HADA Convention
• New County Tax Surcharge
• Booster Seat Law
Hawaii Automobile Dealers Association
1100 Alakea Street, Suite 2601, Honolulu, HI 96813
(808) 593-0031 • Fax: (808) 593-0569
Hawaii’s Fourth Quarter Will
Be a Challenge for Dealers—
—But 2007 Looks to be a
Strong Year for Auto Sales
2007 HADA Officers & Directors
President
Wayne De Luz
President-Elect
Stan Masamitsu
Vice President
Nick Cutter
Secretary
Joe Nicolai
Treasurer
Ben Nakaoka
NADA Director
Joe Hanley
Hawaii Director
Jerry Cousin
Kauai Director
James Hanley
Maui Director
Damien Farias
Oahu Director
Bill van den Hurk
Oahu Director
Ron Hansen
Oahu Director
Morrie Stoebner
Oahu Director
Jack Jackson
At Large Director
Dave Chun
At Large Director
Dennis Short
Immediate Past President
Eric Fukunaga
HADA Staff
Executive Director
Dave Rolf
AUTOCAP Specialist and
Director of Special Projects
Kristin Anderson
O
utgoing HADA president
Eric Fukunaga said it
well when he commented
that anytime we dealers in the state
sell above 60,000 new vehicles, it’s a
pretty good year.
The 2006 fourth quarter for many
Hawaii dealers, though, is looking
to be the most challenging for
profitability in the past five years.
Total new vehicle sales in Hawaii
are tracking at the end of the third
quarter about 4.7% behind last year
– but are projected to finish 3.6%
down - at a total 67,741 for 2006
compared to 70,268 last year in
2005.
This number of sales still puts
Hawaii’s sales at a better per capita
rate than the rest of the country:
Hawaii’s 1 new vehicle sold for every
15 persons in the market compares
favorably to a national ratio of 1 to
20 persons.
The focus for every dealer is now
on profitability.
That’s why in February, HADA
will sponsor our first dealer
profitability seminar — using
NADA’s training materials and
borrowing from the national theme:
Every Dealer Counts.
Our HADA-green theme will
echo throughout much of what
we do along the way. Today’s new
car is 99% less polluting than a
car sold in the 70’s. As these new
millennium cars replace older cars,
the environment is much helped.
In Hawaii the misplaced attack on
the new automobile sales, however,
continues.
A positive development is an
interim session forum where bills
are discussed before needless time
is wasted in the legislative session.
HADA welcomes such courtesies
extended to the Association and
readily provides data for informed
decision-making.
Please enjoy this edition of the
HawaiiDealer with its special
emphasis on our 2007 HADA
Dealer of the Year.
Wayne De Luz
2007 HADA president
HawaiiDealer is designed & published by Custom Publishing Design Group, Inc.®
800.246.1637 • www.MyCompanyMagazine.com. To advertise in an upcoming
issue contact Twinka Tison, 904.242.8586 or e-mail [email protected].
HawaiiDealer is published quarterly by the Hawaii Automobile Dealers Association, 1100 Alakea Street, Suite 2601, Honolulu, HI 96813
Phone: 808 593-0031 Fax: 808 593-0569 Email: [email protected]
«
CoverStory
“An Auto Mall Needs
Accessibility
andVisibility
For Success”
...Says HADA’s 2007 TMQDA Nominee
A
successful auto mall requires two
things for success: 1) accessibility
and 2) visibility, says Stan
Masamitsu, HADA’s 2007 nominee for
the Time Magazine Quality Dealer of the
Year. The Central Oahu property offered
us both, he adds.
A drive up Oahu’s H-2 freeway gives
you a good view of the big autoplex.
Greeted in the spacious parking lot,
you’re directed to a readily available
spacious parking stall and you take the
elevator up to the second floor to get to the
Tony Group administrative offices. After
a short walk through work desks filled
with an enthusiastic admin staff, who all
greet you with a warm smile and a hello,
you soon arrive at the president’s office.
Like the other desks, Stan Masamitsu’s
desk has a few stacks of paperwork,
several framed family pictures, personal
memorabilia, and in sports fan Stan’s case,
a wall shelf containing a full-sized USC
football helmet head-to-head against a
UH Warriors helmet—reminiscent of the
USC-UH football game played in Aloha
Stadium. Stan’s a USC business school
graduate, and a fan of both the Trojans
and the Warriors.
It’s a small, bright, colorful, well-used
office connected to his father’s office by a
double door-sized opening.
“You’re sitting in my Dad’s office, he’s
just turning 80 this year,” said Stan. “He
comes in a couple times a week.”
The Tony Group’s four car dealerships,
Honda, Nissan, Volkswagen and Hyundai,
occupy what amounts to 16 football fields
filled with cars and buildings on Ka Uka
Boulevard in Central Oahu, between
Mililani and Waipio Gentry.
The move, in year 2001, has seemed to be
a good one. The company grew from 250
employees in 2000...to nearly 500 employees
today. New and used car inventory is 1500
vehicles...with 750 available for viewing at
anytime at the auto mall’s vast display lot.
Today, the youngish-looking Stan, 37,
remembers being thrust into the company
president’s chair, when, pictures show that
he looked even younger. “I think of myself
as young today, but in those days I was
really young, Stan said, with an emphasis
on “really.” “It was sure helpful to have
Dad’s office close by.”
At the time, Stan had only recently
returned to Hawaii—after spending
five years in college, including a year in
the middle spent studying at Waseda
University in Tokyo.
After graduation he spent two years
at the company’s California dealerships
at South Coast Acura in Costa Mesa
and Los Gatos Honda in San Jose and a
helpful stint going through the NADA
Dealer Academy and two more years
filling various manager positions at the
Hawaii Tony Group dealerships before
becoming president of Tony Group at the
age of 27.
Indeed, Stan’s learning curve had to be
fast-tracked, but being born into the car
business certainly helped, he says.
“It’s all about expanding on the legacy
built by my Dad,” Stan says. And building
on that legacy.
Stan’s father Tony, a Japanese-American
who was born in Stockton, California,
was a teenager when he and the family
were packed up and sent to the Manzanar
internment camp in Central California
shortly after Pearl Harbor. “It was a time
when the family lost everything,” said
Stan.
Tony was later allowed to go to Los
Angeles and finish high school, and after
graduating, served in the U.S. Army as an
interpreter late in the war and became part
of the occupying force. He stayed to work
in Japan afterwards. It was there that he
met his wife Norie and began selling cars
as a Honda dealer in Japan, in 1967. “At
the time, Honda was little more than a
motorcycle company,” Stan says. Dealers
didn’t inventory the vehicles; servicing
was provided by the factory. The original
Honda cars were very small. A Honda
dealership in Japan was primarily a salesonly operation.
Stan was born in Fujisawa near Tokyo in
1969. With his father being an American
citizen and his Japanese-born mother, a
naturalized American citizen in Japan, Stan
and his two sisters, Lilian and Janet all had
American citizenship.
“I had a bad case of asthma as a kid,” says
Stan, “and in a way that contributed to the
family’s decision to move to Hawaii.” Japan
was very smoggy in the twenty years after
the war as new industries were built. The
Masamitsu family had visited Hawaii several
times and had loved the clean air and beauty
of the islands. So, after 25 years in Japan,
Tony and Norie moved their young family to
Hawaii—opening Tony Honda in Waipahu
in 1977. Stan was 7 years old at the time.
He recalls what he describes as the
long drive out to the Waipahu dealership
from the family home in Aina Haina.
“Fort Weaver road then didn’t even have
street lights at night, but I remember the
brightly lit Skyslide being right next to
the dealership,” he says with a smile. The
Tony Honda dealership was on Farrington
Highway, on the site of the current Aloha
Kia Waipahu dealership, now owned by
Bill van den Hurk.
In those days...Waipahu was considered
out there and pretty far from downtown
Honolulu, Stan said. It was a risk to put
a dealership in. “People were, however,
talking about the Second City at the
time.”
By 1991, the company had grown to six
dealerships including Tony Honda and
Pacific Olds/GMC/Volkswagen in Aiea,
Pacific Nissan and Pacific Mazda/Subaru
In 2000, we sold one of the California
dealerships, and in the same year, sold the
Olds/GMC franchises. Also, in the same
year, the auto mall idea was born with
the consolidation of three dealerships
(Volkswagen, Honda, and Nissan) on a 3acre Aiea property.
“We were always interested in the
concept of auto malls.” Auto malls
were popular in the mainland, where
municipalities offered enticing tax breaks
to lure them to their cities, but in Hawaii
there were no such tax advantages.
“We only had three franchises, and we
thought that such was the minimum to
have a critical mass, so we bought 6 acres
in a largely undeveloped area.” “At the
time, I remember it was pretty much just
Zippys that was up there. Costco was not
in and there were no traffic lights.” “It
took some imagination.”
Nissan) on Friday, and the Tony Group
Autoplex was born. Tony Hyundai was
added in November of 2004. The company
sold 8,202 units in 2005.
Currently, the Tony Volkswagen,
Honda, and Hyundai dealerships are #1
in sales in the state for their respective
automaker categories and Tony Nissan
regularly holds the #1 or #2 sales position.
A car wash doing 200-300 vehicles a day
was added in July of last year.
Stan remembers the night of June 6,
2001 as a Field of Dreams experience. “It
was the night we sold our last car on the
Aiea lot and moved hundreds of cars up to
the new location in Central Oahu. “You
wouldn’t believe the long line of headlights
coming up the road...it was just like in the
movie.”
Today, the boy who grew up in Japan
looking at new car brochures printed in
Japanese, still speaks fluent Japanese as
does wife Masumi, who was also born in
Japan and who had come to California
with her parents as an infant. The two met
at USC. “We try to speak Japanese to the
kids, (Alisa, 5, and Micah 3), said Stan.”
“We filled up most of the lot on Monday
night and opened all three new dealerships
(Tony Honda, Tony Volkswagen and Tony
In June 2006, Stan was recognized by
Pacific Business News with the PBN
“Forty Under 40 Young Business Leader
«
“Around that time, the economy went
sour, and we had all these franchises and all
these stores,” said Stan. “Later we began
downsizing. Those were difficult times”,
he recalls. “In 1998 we closed Mazda and
Subaru. The nineties were difficult times
for all Hawaii dealerships”.
The idea to move up to the Central
Oahu plain was born in the company at
the time.
«
in Waipahu and the two dealerships in
California.
Tony Group’s Career
Day introduced almost
80 auto tech students
to the dealership’s
operations this year,
providing each with
copies of the HADA
Tech Training $1,000
Scholarship program.
Stan awaits “bail” from friends at the MDA Jail-a-thon fund-raiser.
«
Tony Group Autoplex
Accessibility and
visibility are key to the
success of any auto
mall concept, says Stan.
«
of the Year Award.”
In February of 2007, Stan will represent
Hawaii in Las Vegas, where other
nominees for the Time Magazine Quality
Dealer Award and the rest of the nation
will learn at the NADA convention who
has won the national Dealer of the Year
award.
Asked in the nomination form what has
been one of the most rewarding parts of
his career, Stan wrote, “being well
positioned with a modern facility on a fee
simple commercial property in a thriving
area.”
“We all wish Stan luck in February,”
said HADA past president Eric Fukunaga,
who, among others, had nominated Stan
for the award. “He’s helped build some
excellent dealerships here in Hawaii, and
has done a great deal for the community
in the process,” said Eric.
A Recent Tony Group
$45,628 Charity Project
Helped Those Affected
by Hurricane Katrina
In the wake of Hurricane Katrina in
August 2005, Stan asked his nearly 500
employees to join him in raising money
to help those affected by the storm.
Tony Group’s Hurricane Katrina fund
raiser ran from Friday September 9 to
Monday September 19th. Stan offered
to match $1 for every $1 contributed by
the employees...and he threw in a twist.
If the company achieved 100% employee
participation, the Tony Group Foundation
would double the contribution to $2 for
every dollar contributed by the employees.
At the end of 10 days, Tony group
employees achieved 100% participation.
Every single staff member, from hourly
wage earners to senior management made
individual contributions. The donations
were received via payroll deductions in
amounts from $1 to $500. In the end, Tony
Group made donations to the American
Red Cross Hawaii State Chapter totaling
$45,628.
Tony Group has
Funded $37,000 in
Scholarships
Since Stan became president of
Tony Group in 1996, the Tony Group
Foundation has played an active role in
contribution to the education of Hawaii’s
youth. As of June 24, 2006 the Foundation
has awarded $37,000 in scholarships to
recent public high school graduates in the
central and leeward areas of Oahu.
“Thank You, SUMMERLIN
for making health insurance in Hawaii…
COMPETITIVE!”
Dave Chun
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Fax 866-206-5689
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11
Seven Teachers Receive “Free Wheels” (use for a year)
In the HADA 7 Cars for 7 Teachers Program
H
awaii’s franchised new car dealers
have been awarding free cars (use
for a year) to the State Teacher of
the Year and the State’s District Teachers of
the Year since the year 2000. This year, with
the presentation of “7 Cars for 7 Teachers”
at the Board of Education ceremonies 3:30
p.m., Thursday, October 19, 2006 at the Pearl
City High School auditorium, the state’s auto
dealers completed awarding 50 new cars to
public school teachers.
The program was initiated by the
Volkswagen Dealers Association of Hawaii in
1999 with the awarding of a new Volkswagen
Jetta (use for a year) to the State Teacher
of the Year. The following year, with the
help of Hawaii auto distributors, other auto
manufacturer ad associations, and individual
auto dealers, the program was expanded to
provide cars for public school teacher winners
from all seven districts.
“Fifty cars for fifty teachers in the fiftieth
state; that has a nice ring to it,” said Wayne De
Luz, recently elected president of the Hawaii
Automobile Dealers Association (HADA).
“It’s a good milestone to celebrate.”
The HADA involvement began as part of a
larger auto dealer-initiated effort to help the
state public school system adopt annual gradeby-grade SAT9 testing in grades 3 through
8 and one year in high school, and to develop
a $5 million “essential knowledge” grade-bygrade curriculum to improve student verbal
reasoning skills.
12
The legislature adopted the dealersponsored SAT9 testing measure in 2003, but
failed this year to establish funding for the
auto dealer-proposed “essential knowledge”
standardized curriculum—that was to be
developed using county-based, state-based,
and national-based curriculum experts. The
$5 million in funding needed for the program
failed to make it through the final hours of
the legislative session.
The auto dealer-proposed standardized
grade-by-grade curriculum program had
earlier demonstrated remarkable effectiveness.
Two Hawaii public elementary schools—
Solomon Elementary and Kauluwela
Elementary—had, in fact, earlier adopted the
Core Knowledge program, a program similar
to the one proposed by the auto dealers, and
these schools, in 2003, were the only two
schools, out of 100 or so high poverty schools
in the state, to show annual yearly progress
four years in a row.
Auto dealers believe that if the “essential
knowledge” curriculum is indeed funded next
year by the 2007 legislature and then adopted
by the Department of Education, that
Hawaii’s fourth grade reading scores will then
climb from Hawaii’s current position, near
the bottom of the state-by-state rankings, to
near the top, in 72 months.
The end result will be a better educated
work force, say the dealers, and a better
economy for all of Hawaii.
Those Receiving Free Cars
(Use for a Year) Are:
Jami Muranaka of Kaimuki
High School, State Teacher Of The
Year, receives a Volkswagen Jetta TDI
from the Hawaii Volkswagen Dealers,
presented by Ron Wright of Cutter
Ala Moana.
Brett Kewish of Kahuku High
Janice
Nakagawa
of
Waiakeawaena Elementary School,
Hawaii District Teacher Of The Year,
receives a Honda Accord Hybrid,
from Big Island Honda, presented by
Gregg Gaspar.
Naidah Gamurot of Kapolei
Lizabeth Horii of Mililani Ike
Judy Locke of Kihei Elementary
Allison Carveiro of Kekaha
& Intermediate School, Windward
District Teacher Of The Year, receives
a new Toyota Camry from Servco
Toyota, presented by Patrick Ching.
School, Central District Teacher Of The
Year, receives a Honda Pilot from
Pflueger Honda, presented by Kevin
Keppel.
School, Maui District Teacher Of The
Year, receives a Scion xB from Servco
Pacific, presented by Eric Fukunaga.
High School, Leeward District Teacher
Of The Year, receives a Mitsubishi
Galant from Hawaii Auto Dealers
Association, presented by HADA
president Eric Fukunaga.
Elementary School, Kauai District
Teacher of the Year, receives a Suzuki
S602X from Servco Pacific, presented
by Glenn Inouye.
13
14
NORTHWEST / SOUTHWEST
Auto Wholesale
MIKE PETERSEN has been a
member / associate member
supporting HADA for over 30 years.
203 NE Grand Avenue
Portland, OR 97232
Office: (503) 289-2277
FAX: (503) 234-8036
PDX Cell: (503) 936-5554
MIKE PETERSEN
15
16
The view was
spectacular from the
Kuaui Marriott, site
of the 2006 HADA
Convention.
«
Out-going HADA
president Eric Fukunaga
(left) and in-coming
president Wayne De
Luz share a moment
at the swearing in
ceremony.
17
«
«
Parade Marshal and Congressional Medal of Honor recipient Barney Hajiro
was in the parade’s lead convertible, provided compliments of HADA.
NADA chairman Dale Willey swears
in the new HADA board of directors. Shown L-R,
Eric Fukunaga (on stage), Ben Nakaoka, Bill van den
Congressional Medal of Honor recipient Shizuya Hayashi
Hurk, Morrie Stoebner, Dennis Short, Joe Nicolai, Ron
waves from a convertible provided by Cutter Automotive
Hansen, Stan Masamitsu (behind Ron Hansen), Dave
Chun, Nick Cutter, Wayne De Luz, James
Hanley, Joe Hanley, and Jerry Cousin.
Bank of
Hawaii’s Byron
Hansen,
chaired the
golf event
and regaled
the gathering
with one of his
famous jokes.
«
«
Convention chair
James Hanley
launched the
Karaoke event with
a rendition of Mac
the Knife
«
«
18
James Hanley
welcomes HADA
members to Kauai.
Aloha Auto
Auction’s Greg
LeLesch takes a
bid to raise money
for HADA’s tech
training scholarship
program
How to Pass Along
The New Tax Surcharge
I
n order to fund a new mass transit
system on Oahu, the City and County of
Honolulu imposed a 0.5% tax surcharge
starting January 1, 2007 on all goods and
services that are currently taxed under the
state’s General Excise Tax schedule.
On most goods and services the new
total tax that can be passed along will
be 4.712%—an amount that allows the
business to recover the 4% GET and the
additional 0.5% tax, and most of the tax
on the tax. Tax is part of gross revenues
when collected as part of the sale price—
thus tax on the tax itself may be added and
also passed along, according to the Tax
Department.
But unlike the 4% State Gross Excise
Tax, the 0.5% city surcharge is based
on the point of delivery of the goods or
services. Thus a Maui dealer, to pass
along the tax to a customer who is going
to take delivery of the vehicle on Oahu
and garage it on Oahu, will pass along the
additional 0.5%, but only if the dealer has
a “substantial nexus” on Oahu—a “physical
presence or employees that travel to Oahu
to promote the product,” writes Lowell
Kalapa, president of the Tax Foundation
of Hawaii, of which HADA is a member.
The City and County of
Honolulu’s new tax surcharge
takes effect Jan 1, 2007
Taxpayers and Businesses—
When Does It Apply?
Oahu Taxpayer
Neighbor Island (Non-Oahu)
What constitutes delivery? Generally
speaking the State Tax Department holds
that vehicle delivered by the dealership to
a ship or barge and subsequently accepted
at the dock on another island by the
customer constitutes delivery on the island
where the customer accepts the vehicle.
For more information, see www.hawaii.gov/tax/surcharge.
19
Advertise In The
HawaiiDealer
Established under HADA president Charlie King
in 2002, the HawaiiDealer is a quarterly magazine
that provides information on the activities of
HADA members to a wide audience, including the
membership of the Association, key employees at
the dealerships, legislators, city council members,
Hawaii media, the Congressional Delegation, and
many Hawaii sister organizations.
For more information on how to advertise call
Twinka Tison at 904-242-8586
Also see the HADA website at
www.hawaiiautodealer.com
21
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22
Where Else Can You Get More
Than You Asked For?
ALOHA AUTO AUCTION
1001 Ahua Street Honolulu,
Hawaii 96819
• Dealer Consignment Sale Every Wednesday!
• 400 Vehicles Offered, Over 300 Plus Sold Each Week
• Offer Your Cars To 150 Buyers Weekly
• Competitive Live and Internet Bidding
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Call Tom Foster (840-8928)
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23
New Booster
Seat Law Begins
January 1, 2007
B
eginning on January 1,
2007, Hawaii requires
children 4 through 7 years
old to ride in a child safety seat or a
booster seat whenever traveling in a
motor vehicle. The only exemptions
are if the child is over 4’9” or if the
vehicle has lap-only seat belts in the
rear seat.
According to Health Director
Dr. Chiyome Fukino, “Children in
booster seats are 60% safer than in
seat belts alone.”
Including Hawaii, a total of 38
states plus Washington, D.C. have
booster seat laws.
The driver will be held responsible
for compliance with Hawaii’s Child
Passenger Restraint Law. Violators
are required to attend a 4-hour
class and may be assessed a fine of
between $100-$500, depending
upon the number of offenses.
A Hawaii State tax credit of $25
per year applies to the purchase of a
booster or child safety seat.
Additional information can be
found at the Keiki Injury Prevention
Coalition on their website at www.
kipchawaii.org or phone 537-9200
on Oahu.
24
Hawaii Auto Outlook
™
Comprehensive Information on the Hawaii Automotive Market
Fourth Quarter, 2006
Volume 5, Number 4
Small Decline Predicted for Hawaii Market in ‘07; Increase Likely in ‘08
Forecasting the Hawaii new vehicle market is a balancing
act. Indicators frequently present mixed signals on where the
market is headed. Some point to improvement, while others
indicate a decline. The summary on the right presents Auto
Outlook’s list of key positive and negative forecast determinants
for the state market in 2007. Unfortunately, it’s our belief that
the cumulative impact of the negative determinants slightly out
weighs the impact of the positive determinants. This is expected
to result in a small decline in the Hawaii market next year. The
primary concern for the market is the financial well-being of
consumers, which can consequently impact their ability to
purchase new vehicles. On the flip side, fuel prices have eased
over the past couple of months, unemployment rates remain
low, and consumer affordability for new vehicles remains at
close to all-time record strong levels. In addition, the carrot of
appealing new products should lead many consumers to enter
the new vehicle market.
Forecast Summary: Auto Outlook is projecting that new
retail light vehicle registrations in Hawaii next year will exceed
65,500 units, a decline of about 3% from 2006. Registrations
have a good chance of increasing in 2008.
The Hawaii New Retail Light Vehicle Market — At a Glance
The three summaries provide an overview of the Hawaii new retail
light vehicle market. The table above shows the Top Ten sellers in
the state during the Second and Third Quarters of this year, and the
change in market share. Quarterly Review presents the change in
registrations during each quarter of this year versus 2005. (Fourth
Quarter figures are projected). The Annual Review table on the right
shows our forecast for 2006, and actual figures for 2004 and 2005.
Detailed forecasts for all brands are on page 4.
Source for historical data: AutoCount, an Experian Company.
26
28
Hawaii Market Predicted to Improve in 2008 and 2009
Hawaii Auto Outlook
Special Report: Long Term Forecast
During the past four years (2003
thru 2006), the Hawaii new retail
light vehicle market has been
humming along at an impressive
pace, with annual new registrations
exceeding 66,000 units each year.
That performance will likely be hard
to match over the next couple of
years, however. Following a projected
3.6% drop in registrations this year,
Auto Outlook believes that the
market will decline by another 3.3%
in 2007.
That should mark the end of the
market’s relatively mild cyclical
decline, however, with rebounds
predicted for 2008 and 2009.
Registrations in 2009 could exceed
73,000 units, beating the
total reached in 2005.
The two graphs illustrate the market
fundamentals that contribute to our
long term forecast. The top graph
shows two lines: 1. Actual new retail
light vehicle registrations from 2001
through 2005, and our forecast from
2006 through 2009. 2. Baseline
registrations (denoted by the dotted
line), representing “anticipated”
sales in the absence of economic
fluctuations.
Historically, sales follow a cyclical
trend, moving in response to
economic factors and consumer
behavior. When actual sales
fall below baseline, new vehicle
purchases are either postponed due
to a slowing economy; or, sales slack
off following periods of elevated
sales. This is likely to occur in 2007
and 2008. When conditions improve,
actual sales move above baseline, the
case between 2003 and 2005.
The two lines on the graph provide a synopsis of the past and anticipated future performance of
the Hawaii new automotive market. Actual and projected registrations shows actual market results
through 2005 and Auto Outlook’s forecast for 2006 through 2009. Baseline represents anticipated
registrations that would occur in the absence of economic fluctuations, and is a function of “core”
factors, such as the number of households in the state and population over age 20.
Data Sources: AutoCount, an Experian Company and CNW Marketing Research.
The graph above compares National new vehicle sales and scrappage between 1990 and 2005. The
relationship between these two measurements can serve as a significant predictor of new vehicle
sales. When new vehicle sales exceed scrappage, the size of the “overall vehicle fleet” is growing
at an accelerated pace, which could portend a slowdown in new vehicle sales. The gap between
the two was relatively large in 1999 and 2000. An increase in scrappage in 2001 and a decline in
new vehicle sales in 2001 helped narrow the gap somewhat. In 2004, however, the gap widened as
scrappage declined and new vehicle sales increased.
Source: CNW Marketing Research, Inc.
29
30
COUNTY CLOSE-UP
Each of the Four County
Markets Decline thru
September of This Year
The table on the right provides a
summary of each of Hawaii’s four
retail light vehicle markets. This unique
localized information provides a valuable
perspective on market performance,
and a barometer to evaluate the
performance of your dealership. The
table is divided into four parts. The
first, Market Summary, shows total new
retail light vehicle registrations during
the first nine months of 2005 and 2006,
and percent change. The second and
third parts show market share for light
trucks and the Big Three. The fourth
part shows market share figures for the
top 10 selling light vehicle brands in the
state during the first nine months of this
year. The top rated county is shaded.
Observations: Each of the four
markets moved lower, with the smallest
decline in Oahu. Light truck market
share increased 1.7 points in Maui. Big
Three market share decreased in all four
markets. Lexus market share was 3.7%
in Oahu.
Source: AutoCount, an Experian Company.
31
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Hawaii Auto Outlook
Used Vehicle Market Edition
Published by:
Auto Outlook, Inc.
5 Great Valley Parkway, Suite 234 •
Malvern, PA 19355
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 Hawaii Auto Outlook, published
by Auto Outlook, Inc. on behalf of
HADA. Unforeseen events may affect
the forecast projections presented in
Hawaii Auto Outlook. Consequently,
Auto Outlook, Inc. is not responsible
for management decisions based on
the content of Hawaii Auto Outlook.
Copyright Auto Outlook, Inc.
August, 2006
Hawaii Auto Outlook is distributed
free of charge to all members of
the
Hawaii
Automobile
Dealers
Association. The publication is sponsored and supported by the Association.
Hawaii Auto Outlook is published
and edited by Auto Outlook, Inc., an
independent automotive market research
firm. Opinions expressed in Hawaii Auto
Outlook are solely those of Auto Outlook,
Inc., and are not necessarily shared by the
Hawaii Automobile Dealers Association.
Hawaii Auto Outlook
™
Used Vehicle Market Edition
Volume 1, Number 2 • Released December, 2006
IDENTIFYING HOT POCKETS OF HAWAII USED VEHICLE MARKET One and Two Year Old Vehicle Classes Post Gains in 2006
The graph on the right
provides a view of the
changing composition of
the Hawaii used vehicle
market. The graph shows
market share by vehicle age
range in the used vehicle
market during the first 10
months of this year versus
the same period a year
earlier. As shown on the
graph, the hottest classes
so far this year have been in
the newer age ranges, with
2 year old vehicle market
share increasing 2.1 points.
33
RESULTS FOR THE HAWAII RETAIL USED LIGHT VEHICLE MARKET Hawaii Retail Used Vehicle Market Declines 7.1% So Far This Year
The primary objective of Hawaii Auto Outlook—
Used Vehicle Market Edition is to provide practical
and objective information on the state’s used vehicle
market. Below is a summary of primary conclusions,
providing a concise review of market trends, “hot
spots” and “cold spots” in the market, and analysis of
recent sales results.
Retail used vehicle market declines 7.1% so far
this year. Retail used vehicle registrations in Hawaii
totaled 99,023 units through October of this year, a
7.1% decline from the same period a year earlier.
Decline in used vehicle market higher than drop
in new vehicle market. New vehicle registrations
through October fell by a somewhat slimmer 4.7%. As
shown on the second graph to the right, new vehicle
registrations were 57.2% of used vehicle registrations
during the Third Quarter of this year, down slightly
from 59.8% a year earlier. Auto Outlook believes that
the state’s used vehicle market has a chance to post a
small increase next year, while the new vehicle market
is likely to decline.
Oahu and Hawaii County markets post smallest
declines so far this year. Used vehicle registrations
in Oahu and Hawaii Counties declined 5.4% and
6.7%, respectively, during the first 10 months of this
year versus a year earlier (see page 2).
Toyota Tacoma top selling model in Hawaii used
vehicle market. The top five selling models among
vehicles five years old or newer in the state market are
the Toyota Tacoma, Ford FSeries, Honda Civic, Ford
Ranger, and Toyota Corolla (see page 3).
Newer used vehicle classes are taking market
share from older vehicle classes. Vehicles that are
two years old or newer accounted for 24.8% of the
less than eight year old market in Hawaii this year, up
from 21% during 2005.
Hyundai has big gain in used vehicle market. Other
brands recording relatively large increases so far this
year are Mercedes, Lexus, Chrysler, and Subaru (see
page 4).
Source: AutoCount, an Experian Company.
34