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Internet's Impact Increases on Auto Purchase Decisions

October 1, 2003

While the number of consumers visiting automotive Web sites during the new-vehicle shopping process has grown modestly, the impact the Internet is having on buying decisions has increased significantly, according to the J.D. Power and Associates 2003 New Autoshopper.com Study(SM) released Oct. 1.The study finds that nearly one-half (49 percent) of new-vehicle buyers say the Internet impacted their make/model purchase decision -- up from 40 percent in 2002. Furthermore, 24 percent of buyers say the Internet had a "big impact" on their make/model choice, up from 16 percent a year ago. The Internet also impacted the price consumers paid for their new vehicles among 49 percent of buyers, up from 41 percent in 2002."The dynamic surge in the percentage of buyers indicating the Internet had a big impact in their make/model selection and the price paid reflects the increased experience and comfort new-vehicle buyers have with the medium and how much value they see in the information available to them," said Dennis Galbraith, senior director of automotive Web site research at J.D. Power and Associates. The study finds that 83 percent of automotive Internet users visit at least one manufacturer Web site during the shopping process, compared to 79 percent who visit an independent site. Other J.D. Power and Associates research shows that while 90 percent of auto dealerships report having Web sites, 31 percent of those with a site do not post vehicle inventory -- a feature highly desired by consumers."As the volume of leads that dealerships receive from the Internet continues to multiply, dealers must understand that the online lead is not merely a pivot point from Internet to showroom," said Galbraith. "Many of today's buyers are savvy shoppers with advanced Internet navigation and communication skills. Dealers who approach online leads with a strategy of withholding information in an effort to lure shoppers into the showroom may prompt shoppers to simply find another dealership willing to provide online price quotes or inventory information."The study also finds several key automotive Internet usage patterns:● The percentage of new-vehicle buyers who use the Internet for automotive shopping has risen to 64 percent, up from a two-year plateau of 60 percent in 2001 and 2002.

● On average, automotive Internet users spend a total of five hours online shopping for their new vehicle, and 89 percent go online to do research before actually visiting a dealership.

● Twenty percent of buyers purchase their new vehicle from a dealer whose Web site they visited.

● Kelley Blue Book (kbb.com), Edmunds.com and ConsumerReports.org are among the most visited independent automotive Web sites.

The 2003 New Autoshopper.com Study is based on responses from 30,352 who leased or purchased a new vehicle registered in January or February 2003.About J.D. Power and AssociatesHeadquartered in Westlake Village, Calif., J.D. Power and Associates is an ISO 9001-registered global marketing information services firm operating in business sectors including market research, forecasting, consulting, training and customer satisfaction.For more information, visit www.jdpa.com.

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