Powertrain Acceptance & Consumer Engagement Study

Chrysler Powertrain Research March 2008 1

Powertrain Acceptance & Consumer Engagement Study

Research Objectives

The 2010 Morpace Powertrain Acceptance & Consumer Engagement (PACE) study builds upon the findings in last year’s study to provide automotive manufacturers and suppliers with a comprehensive assessment of current and future powertrain technologies from the consumer’s point of view.

• Quantifying awareness, initial interest, and purchase consideration for various powertrain technologies

• Identifying consumer preferences for powertrain characteristics, including engine size/power, fuel type, drivetrain, and transmission type

• Understanding the trade-offs that consumers will make among specific powertrain technologies given the specifications of each—and the resulting impact on expected share (Discrete Choice analysis)

Morpace Syndicated Research: 2010 PACE Powertrain Study 2

The key objectives addressed in the 2010 PACE study include:

What’s “New” for 2010

While last year’s study was a success, some changes are planned for 2010 to meetthe demands of our clients and to best reflect the changing marketplace.

Key Changes for 2010:• Greater focus on electrified vehicles, including range-extended electric vehicles,

and battery-electric vehicles.

o In-depth focus on infrastructure issues and other issues related specifically to these types of vehicles

• Additional technologies tested to include Stop/Start, EREV, FEV

o Omission of CVT and All-Wheel Drive

• Enhanced driver behavior/habits information to better understand how the vehicle is used.

• Detail on fuel economy performance versus expectations, and the price willing to pay for improved miles per gallon.

• Discrete Choice Model: each attribute will be tested at five different levels to increase range of values tested.


Methodology• The 2010 PACE study was conducted online among a total sample of 3,269 U.S.

respondents– Fielding period: April 2010

• The total survey took approximately 30minutes to complete, including the discrete choice exercise

• Participants in the study meet the following criteria:

– Own a qualifying 2006 – 2011 MY vehicle

– Qualifying vehicle purchased/leased new and is still ownedby the respondent

– Respondent intends to purchase another new vehicle in thefuture

– Respondent was primary vehicle owner and decision-maker

– Respondent does not work for an auto manufacturer/supplier/dealer, etc. or a marketing/advertising company

• All data is sales-weighted by vehicle segment

Sample


Vehicle Segment Sample SizeTOTAL 3,269Sub‐Compact Car 248Compact Car 250Midsize Car 355Large Car 249Compact Luxury Car 150Midsize Luxury Car 149Small CUV 248Midsize CUV 242Minivan 249Small SUV 248Midsize SUV 248Large SUV 243Fullsize Pickup 390


Highlights of Findings


The Importance of Fuel Economy

Fuel economy is a major factor among today’s automotive consumers

Fuel Economy (MPG)

Transmission Type

Number of Cylinders

Engine Horsepower

Engine Torque

Engine Size (Displacement)

Importance of Specs on New Vehicle Shopping (% Very Important 5 on 5pt scale)

57

53

19

18

15

14

− Consumers place high emphasis on fuel economy when considering avehicle


% CompletelySatisfied

MeanRating

% Completely Dissatisfied

Engine Reliability & Durability 9.1 *

Overall Engine 8.9 *

Engine Vibration 8.9 1%

Overall Transmission 8.8 1%

Smoothness of Transmission/Shift Feel 8.7 1%

Engine Noise 8.6 1%

Power and Pickup Provided by Engine 8.6 1%

Fuel Economy 7.7 2%

Satisfaction with Current Engine & Transmission

79

71

71

69

66

62

62

38

Further, consumers are not satisfied with the fuel economy they are achieving today

− Satisfaction is lowest among SUV and Pickup owners, but Midsize CUV and Minivan owners are less satisfied as well


Consumers anticipate higher fuel prices in the future, emphasizing the importance of improved fuel economy

RecentlyPaid

Anticipated Cost1 Year From Now

Anticipated Cost3 Years From Now

Anticipated Cost5 Years From Now

Fuel Price(Mean)

$2.83$3.12

$3.82

$4.64

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

$5.00

2009 - $2.74


For many consumers, the actual fuel economy they are achieving is less than what they originally expected

Total Sample

Sub-Compact

Compact Car

Midsize Car

Large Car Compact Luxury Car

Midsize Luxury Car

Small CUV Midsize CUV

Small SUV Midsize SUV

Large SUV Minivan Fullsize Pickup

(3269) (105) (541) (566) (241) (154) (77) (365) (182) (78) (195) (101) (190) (475)

Fuel Economy More or Less than Expectations (%)

3 10 3 5 4 3 7 2 2 4 1 2 1 218

2425 19 20 19 15

12 17 13 13 10 13 15

5045

44 52 50 53 5054 45 49 53 53 49 52

25 19 26 21 21 22 22 29 31 26 26 26 31 244 2 1 3 4

15 2 4 8

6 7 5 60 0 01

0 0 0 0 1 0 2 1

Don't know Much less than expected A bit less than expected Equal to what I expected A bit more than expected Much more than expected


While improved fuel economy is strongly desired, consumers are only willing to pay so much for it

Total Sample10% 20% 30% 40% 50%

Additional Amount Willing to Pay to Increase MPG ($)Total Sample

$578$921

$1,369

$1,882

$2,515


Consumers do not necessarily want fuel economy to come at the cost of performance

Trade engine size for fuel economy

Consider environmental vehicles if similar performance in the class

Keep same type but shop different brands for fuel efficiency

Pay more for environmental vehicle

Sacrifice performance for fuel economy

Pay more for delivering more exhilarating performance

Buyer Personal Characteristics (% on a 5 point scale)

22

16

16

12

7

6

31

32

32

28

26

19

27

28

31

37

37

34

13

14

12

14

21

26

7

10

9

9

9

15

% Strongly Agree % Strongly Disagree


Fuel Type Comparison


Gasoline is rated highest for passing performance, but is not seen as economical or environmentally-friendly

Highway Passing Performance

Passing Performance

Reliable

Safe to Use

Acceleration from a Standing Start

Towing Performance and Capacity

Noise/Vibration at Idle

Noise/Vibration During Driving

Engine Sound

Driving Distance Between Fill-Ups

Holds Value (Resale)

Exhaust Odor

Innovative/New Technology

Fuel Economy

Cost to Operate

Environmentally-Friendly

Opinion of Gasoline Engine (% Excellent 5 on 5pt scale)

48

43

43

42

41

27

21

21

20

17

14

14

9

7

6

5


While noise and odor are still perceived issues for diesel, the fuel is noted for its exceptional towing performance


Safe to Use

Reliable



Passing Performance



Fuel Economy


Cost to Operate


Engine Sound



Exhaust Odor

Opinion of Diesel Engine (% Excellent 5 on 5pt scale)

45

29

24

19

15

14

9

9

9

5

5

4

3

3

3

2


Hybrids are cited as providing an economical and quiet ride, but lack in many performance areas

Fuel Economy





Safe to Use

Exhaust Odor

Engine Sound


Cost to Operate


Reliable



Passing Performance


Opinion of Hybrid Electric Vehicle (% Excellent 5 on 5pt scale)

39

38

37

36

31

31

30

29

28

19

16

15

8

7

7

3


Fully-Electric Vehicles outperform all other fuel types across many “green” categories, but are thought to have some performance deficiencies

Exhaust Odor

Fuel Economy




Engine Sound


Safe to Use


Cost to Operate


Reliable



Passing Performance


Opinion of Fully Electric Vehicle (% Excellent 5 on 5pt scale)

67

63

62

57

53

52

46

34

32

31

16

12

8

7

6

3


Technology Assessment


Hybrid-Electric Vehicles are the alternative fuel technology consumers are most interested in

Clean Diesel

Turbo Charged Direct Injection

Stop/Start Technology

Hybrid Electric Vehicle

Plug-in Electric Vehicle

Extended-Range Electric Vehicle

Fully Electric Vehicle

Interest in New Automotive Technologies (%)

9

11

10

18

11

10

10

32

37

30

41

35

28

28

41

48

40

59

46

38

38

% Very/Somewhat Interested


Adoption is highest for HEVs as well, while folks are not as likely to choose an electric vehicle for their next purchase

Clean Diesel

Turbo Charged Direct Injection

Stop/Start Technology

Hybrid Electric Vehicle

Plug-in Electric Vehicle

Extended-Range Electric Vehicle

Fully Electric Vehicle

Consideration of New Automotive Technologies (%)

16

16

8

19

9

9

9

26

29

23

32

25

25

19

42

45

31

51

34

34

28

% Strongly / Possibly Consider


Improved fuel economy and lower operating costs are the top reasons consumers will consider an alternative fuel technology

Improved Fuel Economy

Lower Operating Costs

Better for the Environment

Less Reliance on Fossil Fuels

Good Resale Value

Improved Power and Pickup

I Want to be Seen as Doing Something Good for the EnvironmentI Like to Own the Latest, Cutting-Edge

TechnologyI Want to be Noticed for Owning

Something and Different

Influence on Alternative Fuel Consideration (% on a 5 point scale)

55

45

34

33

26

20

11

4

3

32

37

32

32

35

30

20

9

6

9

13

21

22

27

31

29

25

20

2

2

6

6

7

11

16

25

22

2

3

7

7

5

8

24

37

49

Strong Influence No Influence


Battery-Powered Vehicles


Consumers expect to be able to drive approximately 230 miles—or five hours—before recharging their vehicle

Total Sample

Sub-Compact

Car

Compact Car

Midsize Car

Large Car

Compact Luxury

Car

Midsize Luxury

Car

Small CUV

Midsize CUV

Small SUV

Midsize SUV

Large SUV

Minivan Fullsize Pickup

(3031) (98) (517) (523) (216) (147) (71) (347) (167) (73) (174) (88) (182) (427)

Electric Battery Distance until Recharge Expectations (miles)(includes those that are not a definite rejector of all three technologies (PHEVs, ReEVs, and BEVs)

231 229 223 236 227 237272

212 226 232261 253

223 229

Total Sample

Sub-Compact

Car

Compact Car

Midsize Car

Large Car

Compact Luxury

Car

Midsize Luxury

Car

Small CUV

Midsize CUV

Small SUV

Midsize SUV

Large SUV


(3031) (98) (517) (523) (216) (147) (71) (347) (167) (73) (174) (88) (182) (427)

Electric Battery Recharge Expectations from Zero to Full (hours)(includes those that are not a definite rejector of all three technologies (PHEVs, ReEVs, and BEVs)

5.1 4.9 4.85.3

4.85.6

4.6 4.85.7

5.2 5.2 5.2 5.1 4.9


The majority of consumers park their vehicles at their residenceovernight

Total Sample

Sub-Compact

Car

Compact Car

Midsize Car

Large Car

Compact Luxury

Car

Midsize Luxury

Car

Small CUV

Midsize CUV

Small SUV

Midsize SUV

Large SUV


(3269) (105) (541) (566) (241) (154) (77) (365) (182) (78) (195) (101) (190) (475)

Where Vehicle is Parked Overnight (%)

5540 49

66 67 70 7057

69 60 54 60 5632

3439 30

24 26 15 2131

2531 37 35 39

62

57 11

5 55 757

In a garage at my residence Drivew ay at my residence Parking lot Parking garage/structureOn the street Some other place at my residence Some other place not at my residence

− About half park the vehicle in their own garage


While most consumers have access to 110v outlet when parking overnight, significantly fewer have electrical access during theday

Total Sample

Sub-Compact

Car

Compact Car

Midsize Car

Large Car

Compact Luxury

Car

Midsize Luxury

Car

Small CUV

Midsize CUV

Small SUV

Midsize SUV

Large SUV


(3269) (105) (541) (566) (241) (154) (77) (365) (182) (78) (195) (101) (190) (475)

Parking Habits - Standard 110v Availability (% Yes)

83

68 7384

90

7585 80

89 86 87 92 9487

41

2632

4149

3242

3546

39 40

53 55 51

Overnight Daytime


Concerns with plugging-in a vehicle at home are most often related to safety/security


Optimal Powertrain Configuration


Discrete Choice Model - Overview• The objective of the discrete choice exercise is to measure share of preference for

different engine types as a function of performance, fuel economy, driving range, technology and price.

• In the choice exercise, respondents were asked to select an engine from a set of six that best met their needs. The engines offered varied by segment, and within a segment the engines varied by the factors referred to above.


Compact Car: Expected Shares (Base Case)

4-Cylinder Gasoline(0-60 MPH (seconds) 10.0; Equivalent Fuel Economy (MPG) 32/ Total Driving Range (Miles) 385; $0)

4-Cylinder Gasoline Turbo Direct Injection (GTDI)(0-60 MPH (seconds) 9.0; Equivalent Fuel Economy (MPG) 34/ Total Driving Range (Miles) 410;

$1,000)

4-Cylinder Clean Diesel(0-60 MPH (seconds) 9.5; Equivalent Fuel Economy (MPG) 38/ Total Driving Range (Miles) 460;

$2,000)

4-Cylinder Hybrid-Electric Gasoline(0-60 MPH (seconds) 10.0; Equivalent Fuel Economy (MPG) 45/ Total Driving Range (Miles) 540;

$3,500)

4-Cylinder Extended-Range Hybrid-Electric Gasoline(0-60 MPH (seconds) 10.0; Equivalent Fuel Economy (MPG) 80/ Total Driving Range (Miles) 400;

Electric-Only Range (Miles) 40, Recharge Time 120v/240v (Hours) 8/2 ; $5,500)

Full Electric(0-60 MPH (seconds) 10.0; Equivalent Fuel Economy (MPG) 160; Electric-Only Range (Miles) 100,

Recharge Time 240v (Hours) 5 ; $7,500)

Expected Engine Shares at Base Case Level (%)

None of these engines

29

14

15

31

8

2

2


Compact Car: Attribute Sensitivity


Acceleration (0-60 MPH) Acceleration (0-60 MPH) Acceleration (0-60 MPH)7.5 seconds 35 6.8 seconds 19 7.1 seconds 208.5 seconds 32 7.7 seconds 15 8.1 seconds 1910.0 seconds 29 9.0 seconds 14 9.5 seconds 1511.5 seconds 28 10.4 seconds 11 10.9 seconds 1112.5 seconds 27 11.3 seconds 9 11.9 seconds 8

24 MPG/289 Miles 16 26 MPG/ 308 Miles 5 29 MPG/345 Miles 327 MPG/327 Miles 19 29 MPG/349 Miles 7 32 MPG/391 Miles 432 MPG/385 Miles 29 34 MPG/410 Miles 14 38 MPG/460 Miles 1537 MPG/443 Miles 39 39 MPG/472 Miles 29 44 MPG/529 Miles 2640 MPG/481 Miles 48 43 MPG/513 Miles 39 48 MPG/575 Miles 32

Price Price PriceN/A - $750 16 $1,500 23N/A - $850 15 $1,700 19N/A - $1,000 14 $2,000 15N/A - $1,150 12 $2,300 13N/A - $1,250 10 $2,500 10

Expected Share Sensitivity Summary (%)Compact Car Segment

4-Cylinder Gasoline 4-Cylinder Gasoline Turbo Direct Injection (GTDI) 4-Cylinder Clean Diesel

Equivalent Fuel Economy (MPG)/Driving Range (Mi) Equivalent Fuel Economy (MPG)/Driving Range (Mi) Equivalent Fuel Economy (MPG)/Driving Range (Mi)

Optimal Powertrain Configurator

Compact Car Simulator

Engine 1

Engine 2

Engine 3

Engine 4

Engine 5

Engine 6

Engine 7

Engine 8

Engine 9

Engine 10

None

Gasoline 4-cyl

EnginePresent?Fuel Economy (mpg) Additional Cost

Gasoline - Turbocharge

Clean Diesel 4-cyl

Clean Diesel 4-cyl

Extended Range Electric

Full Electric

Calculate Sensitivity ??

Gasoline - Turbocharge

Gasoline 4-cyl

Gasoline 4-cyl

Gasoline 4-cyl

7.5 $0

8

10

9

9

9

7.5

7.5

7.5

7.5

$1,250

$1,500

$1,500

$4,130

$5,625

$750

$0

$0

$0

0-60 MPH (seconds)

Total Driving Range (miles)

481

349

398

421

300

0

506

481

481

481

40 0

Electric Driving Range (miles)

n/a

Recharge Time Hours (120v/240v)

29

33

35

60

120

42

40

40

40

0

0

0

30

75

0

0

0

0

n/a

n/a

n/a

12/3

_/5

n/a

n/a

n/a

n/a


Simulation:•Increase Clean Diesel fuel economy to 40 MPG•Lower cost to $1,500

Simulation:•Increase Clean Diesel fuel economy to 40 MPG•Lower cost to $1,500

Optimal Powertrain Configurator


4-Cylinder Gasoline(0-60 MPH (seconds) 10.0; Equivalent Fuel Economy (MPG) 32/ Total Driving Range (Miles) 385; $0)

4-Cylinder Gasoline Turbo Direct Injection (GTDI)(0-60 MPH (seconds) 9.0; Equivalent Fuel Economy (MPG) 34/ Total Driving Range (Miles) 410; $1,000)

4-Cylinder Clean Diesel(0-60 MPH (seconds) 9.5; Equivalent Fuel Economy (MPG) 40/ Total Driving Range (Miles) 460; $1,500)

4-Cylinder Hybrid-Electric Gasoline(0-60 MPH (seconds) 10.0; Equivalent Fuel Economy (MPG) 45/ Total Driving Range (Miles) 540; $3,500)

4-Cylinder Extended-Range Hybrid-Electric Gasoline(0-60 MPH (seconds) 10.0; Equivalent Fuel Economy (MPG) 80/ Total Driving Range (Miles) 400; Electric-Only

Range (Miles) 40, Recharge Time 120v/240v (Hours) 8/2 ; $5,500)

Full Electric(0-60 MPH (seconds) 10.0; Equivalent Fuel Economy (MPG) 160; Electric-Only Range (Miles) 100, Recharge

Time 240v (Hours) 5 ; $7,500)

Expected Engine Shares at Base Case Level (%)

None of these engines

25

9

26

27

7

3

3

4

11

5

4

1

1

1

Change from Base Case

For More Information:Bryan E. Krulikowski

Vice President248.539.5277

[email protected]


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Powertrain Acceptance & Consumer Engagement Study